News / Middle East

Oil Prices Rise as Concerns Grow Over Japan Disaster, Mideast Unrest

Burning oil tanks in Libya
Burning oil tanks in Libya

Multimedia

Crude oil prices are climbing as energy experts worry about the impact of the fighting between rebel and government forces, and the newly-imposed international no-fly zone, on Libya's oil production.  Adding to the price volatility is continuing unrest in Bahrain, Syria and Yemen - along with speculation of increasing global demand.  

In the Libyan oil port of Zwitina, northeast of Benghazi, burning fuel tanks underscore the damage to Libya's oil production - down from about 1.6 million barrels per day to less than 400,000.

Shukri Ghanam, chairman of Libya's National Oil Corporation, says the country is desperate to get oil flowing again.

"We will be even looking at giving direct contracts and direct blocks to companies from any country that is kind of willing and ready to come and work in the country," said Ghanam.

The disruption has resulted in sharply higher oil prices and renewed concerns that the unrest could spread to other oil producing countries in the Middle East.

The earthquake and tsunami damage in Japan has only fueled more concern.

In the country's northeast, the Fukushima nuclear crisis appears to be stabilizing,  but analysts say Japan is likely to increase oil and gas imports to make up for the loss of power from the damaged nuclear facilities.

Oliver Roth is a market strategist at Close Seydler Bank:

"The intervention in Libya right now doesn't play a big role in the focus of the financial markets," said Roth. "We are much more focused on the oil price and on Fukushima."

As a result oil prices remain extremely volatile.  

Jan Randolph at IHS Global Insight expects prices to trend higher.

"Demand is rising relative to supply and stretching supply," said Randolph. "That's why oil prices have moved up over the last few years, but the spiking is on top of this.  And it adds what we call a counter-risk premium which is anything between 10 and 20 dollars on the oil price and that is very much related to the day-to-day events."

For many in Japan, day to day has been anything but normal.

"There are still concerns over the shortage of gasoline supplies," said a Japanese. "We are rationed 20 liters a person per day and sometimes have to wait four of five hours to get fuel.  I am worried how that will be solved in the future."

Experts say oil prices are likely to hit $120 a barrel in coming months.
Economists say that will lead to higher prices for food and gasoline - adding downward pressure to an already weak global recovery.

You May Like

Ukraine President Appeals for More US Support

Speaking before Congress ahead of meeting with President Obama, Petro Poroshenko urges lawmakers to back Ukraine in its quest for freedom and democracy More

Photogallery Global Audience Watches as Scots Go to Polls

People were almost equally divided over a vote for independence, watched closely by Britain's allies, investors and restive regions at home and abroad More

China to Invest $20B in India Amid Border Dispute

Border spat between armies of two countries in Himalayas underlines mutual tensions despite growing commercial ties highlighted by Xi Jinping's high-profile visit More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Russian Economy Reeling After New Western Sanctionsi
X
September 18, 2014 2:28 AM
A new wave of Western sanctions is hitting Russia’s economy hard. State-owned energy firms continue to bleed profits and Russia’s national currency plunged to a new low this week after the U.S. and the European Union announced new sanctions to punish Russia's aggressive stance in eastern Ukraine. But as Mil Arcega reports, the sanctions could also prove costly for European and American companies.
Video

Video Russian Economy Reeling After New Western Sanctions

A new wave of Western sanctions is hitting Russia’s economy hard. State-owned energy firms continue to bleed profits and Russia’s national currency plunged to a new low this week after the U.S. and the European Union announced new sanctions to punish Russia's aggressive stance in eastern Ukraine. But as Mil Arcega reports, the sanctions could also prove costly for European and American companies.
Video

Video Belgian Researchers Discover Way to Block Cancer Metastasis

Cancer remains one of the deadliest diseases, despite many new methods to combat it. Modern medicine has treatments to prevent the growth of primary tumor cells. But most cancer deaths are caused by metastasis, the stage when primary tumor cells change and move to other parts of the body. A team of Belgian scientists says it has found a way to prevent that process. Zlatica Hoke has more.
Video

Video Mogadishu's Flood of Foreign Workers Leaves Somalis Out of Work

Unemployment and conflict has forced many young Somalians out of the country in search of a better life. But a newfound stability in the once-lawless nation has created hope — and jobs — which, some say, are too often being filled by foreigners. Abdulaziz Billow reports from Mogadishu.
Video

Video A Dinosaur Fit for Land and Water

Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Video

Video Iraqi Kurdistan Church Helps Christian Children Cope find shelter in churches in the Kurdish capital, Irbil

In the past six weeks, tens of thousands of Iraqi Christians have been forced to flee their homes by Islamic State militants and find shelter in churches in the Kurdish capital, Irbil. Despite U.S. airstrikes in the region, the prospect of people returning home is still very low and concerns are starting to grow over the impact this is having on the displaced youth. Sebastian Meyer reports from Irbil on how one church is coping.
Video

Video NASA Picks Boeing, SpaceX to Carry Astronauts Into Space

The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video Future of Ukrainian Former President's Estate Uncertain

More than six months after Ukraine's former President Viktor Yanukovych fled revolution to Russia, authorities have yet to gain control of his palatial estate. Protesters occupy the grounds and opened it to tourists but they are also refusing to turn it over to the state. VOA's Daniel Schearf reports from Mezhigirya, just north of Kyiv.
Video

Video China Muslims Work to Change Perceptions After Knife Attacks

China says its has sentenced three men to death and one woman to life in prison for a deadly knife attack in March that left more than 30 dead and 140 injured. Beijing says Muslim militants from China's restive western region of Xinjiang carried out the attacks. Now, more than six months after the incident, residents in the city are still coping with the aftermath. VOA's Bill Ide has more from Kunming.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid