Libyan crude burns as North African war rages

A massive tanker fire in eastern Libya may stem the precipitous fall in oil, with 850,000 barrels burned up already.

The inferno, which has consumed five oil silos, was the result of a skirmish between the Libyan army and a rebel band called Libya Dawn in the port city of Es Sider, according to the Telegraph.

The port is one of the nation’s busiest crude export hubs and can store more than 6 million barrels.

Brent had fallen beneath $60 a barrel last week, but a prolonged shock to Libyan production could prevent the price falling much further.

The country’s exports have been haphazard since the overthrow of late dictator Muammar Gaddafi in 2011 and subsequent civil war.

Many Opec countries – particularly Saudi Arabia – are happy to see the oil price crash for the short to medium term as it puts pressure on the indebted and nascent US shale gas industry. Many unconventional gas producers are unprofitable if the crude oil price remains so low.

At 10.35am the price of WTI crude was $55.20, while Brent was $59.90.

Oil’s slump