OIL PRICES surged past $120 (£74.35) a barrel to reach a 28-month high yesterday, as unrest in Libya and across the Middle East put further doubt on the security of supplies.
Brent crude futures for May delivery rose 2.3 per cent to $121 a barrel in London trading yesterday, while spot prices rose 1.7 per cent to $119.88.
Bloody skirmishes between dictator Gaddafi’s forces and anti-government rebels in the oil hub town of Brega, eastern Libya, stoked fears of long-term conflict that will continue to choke exports from the country.
Gaddafi supporters yesterday hammered the northern city of Misrata, using tanks and snipers against civilians, according to witnesses in one of the last remaining rebel strongholds.
The US government yesterday lifted sanctions on Libya’s former foreign minister Moussa Koussa, who defected last week, in an attempt to encourage other members of Gaddafi’s regime to abandon their posts.
An envoy from the Gaddafi government arrived in Turkey yesterday, as a spokesperson in Tripoli said the regime was committed to finding a “political solution”.
Supply concerns in Libya were compounded by industrial action in Gabon and Iran’s refusal to consider immediately increasing supply from the OPEC countries to ease pricing pressure.
Protests in Yemen also gathered pace yesterday, despite police opening fire on anti-government campaigners.