Oil above USD 98 as Libya’s oil industry in chaos

New York, February 28:Oil prices rose above USD 98 abarrel today as Libya’s violent power struggle continued to disrupt crude output in the OPEC nation. Violent protests in Oman also raised fears political upheaval could affect other crude exporters.

By early afternoon in Europe, benchmark crude for April delivery was up 33 cents to USD 98.21 a barrel in electronic trading on the New York Mercantile Exchange.

The contract rose 60 cents to settle at USD 97.88 on Friday. In London, Brent crude for April delivery was up 46 cents to USD 112.60 a barrel on the ICE Futures exchange.

In volatile trading, both contracts were well off their peaks from earlier in the session: Nymex reached USD 99.96, while Brent briefly touched USD 114.50.

As fighting between supporters and opponents of Libyan leader Moammar Gadhafi continued over the weekend, foreign oil companies scrambled to evacuate staff. The chaos in Libya’s oil industry has cut production by at least 750,000 barrels daily, down from its normal capacity of 1.6 million barrels, the International Energy Agency reported late Friday.