Following the news over the weekend that Libyan rebels have taken control of large parts of the capital city of Tripoli, oil prices fell on Monday on the hope that Libyan oil output will eventually regain the production levels that stood prior to the beginning of the now six-month uprising against the regime of Moammar Gaddafi.
In morning trading, prices for Brent crude futures were down 1.35% to $107.15 per barrel, although prices for West Texas Intermediate (WTI) crude were up 0.9% to $83.17 per barrel.
Libya provided only 1.2% of the United States’ oil imports in 2010, according to the International Energy Agency, while many European countries had relied on Libyan oil for a much larger percentage of their total crude oil imports prior to the rebellion. As of 2010, for instance, Germany received 7.7% of its crude from Libya, France received 15.7%, Italy received 22%, and Ireland received 23%. Libya had exported 85% of its crude oil to Europe prior to the rebellion.
The Financial Times reported Monday that before the start of the civil war, Libya produced about 1.6 million barrels a day of high quality, low sulphur crude oil, but the six-month long conflict has reduced the flow to just 50,000 barrels per day.