Elections were the first in Libya in more than 40 years. Without the iron fist of Gadhafi, however, a unified Libya exists largely on paper. Though Iraq held elections in 2005, two years after the U.S.-led invasion toppled the regime of Saddam Hussein, internal rivalries still overshadow the country's crude oil ambitions. While production levels approaching 3 million bpd are pushing Iraq close to the top of OPEC, disputes between the central government and the regional Kurdish administration kept Exxon Mobil out of Iraq's latest international auction. Kurdish leaders, for their part, say oil companies wanting to work in Kirkuk, with an estimated 25 billion barrels of oil, need their permission, not Baghdad's.
The same could be true for Libya. In April, protestors in the former rebel capital of Benghazi called for more transparency from a state oil company. Demonstrators said they were frustrated with how the interim government was spending money, highlighting the growing frustration among post-revolutionary youth in the Middle East. Those protests coincided with one of Libya's first international oil and natural gas expos since the Gadhafi era ended last year.
Ports were back in service in Libya by Monday. Oil markets last week reacted strongly to poor economic data from the United States and the lingering strike from offshore oil workers in Norway. Brent crude prices moved closer to the $100 mark in Monday trading on signs that Norway may be headed from a complete shutdown of oil production. Investors are keeping an eye on the lacklustre performance of the U.S. and Chinese economies, coupled with on-going concerns in the Eurozone. Those factors help keep oil prices relatively low. But over their shoulders, its issues like Libya, where 300,000 bpd can be cut off at a whim, that forecasters cast their cautious glance.
(Source: Oil Price)