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Libya and the Price of Oil

Experts differ on what the turmoil in Libya portends for oil prices.
August 25, 2011

LIBYA - Whether the Gadhafi regime in Libya is headed for an imminent fall or a prolonged civil war, experts disagree on what it means for the global oil markets.

Fleetowner.com reports the area��s turmoil will have little impact on global oil markets, which means the slow decrease in diesel fuel prices won��t free-fall any time soon.

"Little crude oil from Libya won��t, with any meaningful consistency, hit the market for many months; most estimates I see are like a year," said Denton Cinquegrana, editor-West Coast spots for OPIS.

"In my opinion, in the short-term, this probably won��t do much, but looking out more medium/long term, it could help loosen up [oil] prices," he added. "But then who knows where we will be economically at that time."

The Associated Press was more optimistic, stating, "It could be a year or more before Libya produces enough oil to start exporting it in large amounts again. But once the oil starts flowing, it should bring the price of gasoline down even further��International oil prices fell Monday because of the prospect that those shipments will hit the market again."