Libya Affects Oil Prices

6 03 2011

The article can found at this link. Background information was found here.

In Libya, there has been a rebellion  against the Libyan’s government to out their leader, Muammar Gaddafi. The rebels took hostage and control over the eastern area of Libya which also happens to be a  town where oil is currently produced. Recently in order to get the land back, Muammar Gaddafi sent an air raid and hit an area known as Brega which is 2 kilometers from the Libyan’s oil terminals. This caused fear and panic to the people in that area and also the workers of the oil terminal resulting in many to flee the country. Due to the shortage of workers in the oil terminals, this caused Libya to send around 7 hundred thousand barrels per day when they normally send 1.6 million barrels per day. While the demands for oil are still the same, shortage of oil circulating in the market caused the price of oil to increase. Supplies decreasing would be an example of change in number of sellers. This is because Libya is producing almost half as less so there is a decrease in numbers of oil being sold.

The crisis at Libya caused a shift in supply downwards and causing the price to increase.




2 responses

6 03 2011

joey! i didn’t see your post…

6 03 2011

um… dont copy please 😦

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: