Libyan oil fields under attack sent the cost of oil surging on Friday to a 32-month high above $124 as gold entered record territory yet once more.
Reuters reported that worries about lengthy disruptions to Libya’s oil supply teamed with an overall rise in the prices of commodities. That sent Brent crude up in morning European trading, rising $1.49 to $124.16 after briefly touching $124.45, where it had not been since August of 2008. U.S.crude rose $1.24 to $111.64, after checking in at an intraday level of $111.68; it had not been that high since September of 2008.
Christophe Barret, commodities analyst at Credit Agricole, was quoted in the report saying, "It looks like some of the fields in Libya are starting to be the target for military strikes which is worrisome because it means we have a risk of losing more crude for longer." Libya’s output has been cut by 80% by its conflict; it is now producing only 250,000-300,000 barrels per day. International Energy Agency data show that it took Kuwait two years to get back to its pre-Gulf War production levels, comparable to Libya, of 1.6 million barrels per day once hostilities ended.