Libya’s largest oil port, Es-Sider, is on the cusp of restarting loadings, which would lift the most important hurdle standing in the way of a return to normal exports following the end of civil war, the country’s oil chief said Thursday.
[Libya’s interim Oil Minister Ali Tarhouni] said oil production should reach 700,000 barrels a day by the end of the year—nearly half of prewar production—confirming estimates made earlier Thursday by the International Energy Agency.
The spread between Brent Crude and Nymex WTI Light Crude remains at $24/barrel. Brent is rallying to test the declining trendline, but retreat to medium-term support at $105 is likely. Resolution of the conflict in Libya should take some of the supply pressure off European refineries, easing Brent prices.
* Target calculation: 105 – ( 120 – 105 ) = 90
We then have to wait and see what Chairman Ben pulls out of his hat at the September 21st FOMC meeting. Further quantitative easing would cause an upward spike in commodity prices, including crude.