Libya oil production to resume, US oil production in Gulf of Mexico normalized – Commerzbank

One reason for the weakening of prices last week was the agreement reached by warring parties in Libya in the dispute over the leadership of the central bank, notes Commerzbank commodity analyst Carsten Fritsch.

Additional supply from Libya is likely to influence oil prices

“The agreement was reached by the conflicting parties in Libya in the dispute over the leadership of the central bank. This led to a disruption in oil production in the east of the country, which caused national oil production to drop from 1.2 million to less than 450 thousand barrels per day.”

“Yesterday, the parliament in eastern Libya approved the appointment of the new central bank governor, which should allow for an increase in oil production there. It is expected to begin today, according to people familiar with the matter. Additional supply from Libya is likely to influence oil prices.”

“A similar observation can be made for US oil production in the Gulf of Mexico. Hurricane Helene cut production there for several days last week. Thursday’s outages accounted for about a quarter of US production in the Gulf of Mexico, according to the regulator. By Sunday, production was almost back to normal levels.”