Libya's turmoil hits home as oil prices rise
Libya is a major oil exporter. Continued unrest in the North African nation is driving up energy prices -- and that could hurt the fragile global recovery.
A driver refuels his car at a gasoline station in Madrid. Brent crude oil prices hit $108 a barrel for the first time since 2008 on Monday on fears that spiraling violence in Libya could lead to wider supply disruptions from the OPEC member.
REUTERS/Andrea Comas
Muammar Qaddafi's regime is reeling in the wake of mass protests, tribal divisions, uncertainty about the loyalty of the military, and widespread outrage over attempts to suppress opponents. The Libyan strongman's days look numbered. As in every other Middle East nation that has been rocked by unrest, Libya's road ahead is uncertain.
Besides concern for the safety of citizens and questions about which way the Middle East is headed, the Libyan uprising brings the question of oil directly into the picture.
The North African nation has the world's ninth largest reserves. And it may be richer than that. Because of decades of isolation under Col. Qaddafi, exploration for new resources has been limited. The ongoing unrest has prompted the evacuation of oil workers and the shutting down of production.
Most of Libya's oil exports go to Europe, but that doesn't insulate the United States or the rest of the world. Oil futures prices are rising because of uncertainty over supplies. Much depends on how -- and how soon -- events play out. If Libya and Middle East oil producers remain unstable, higher prices may persist.
That, in turn, could affect the global economic recovery.