US oil ends near $98; rally loses steam as demand falters

Reuters with
A file photo showing a Libyan oil worker from the Libyan National oil and gas company checks an oil pipelines at the Zawiya oil installation in Zawiya, Libya.
Mahmud Turkia | AFP | Getty Images

Crude fell on Tuesday, giving back some of the previous session's sharp gains, on expectations that recent disruptions in exports from OPEC member Libya could be short-lived.

Brent rose 2.5 percent on Monday as reports of Libya's worst civil unrest since the civil war in 2011 fueled concerns over global oil supplies. Libya's crude oil exports have slumped to around 90,000 barrels per day (bpd), less than 10 percent of capacity, due to the worst disruption since a 2011 civil war.

The loss of most of Libya's oil exports as well as spiraling violence in Iraq and problems in other major producers have removed more than 3 million bpd from the oil market, analysts say, an amount not seen since August.

London Brent crude for December delivery was trading down 70 cents under $109 a barrel. U.S. crude for December delivery settled down 48 cents at $98.20 a barrel.

Libya's Prime Minister said oil exports from Libya's eastern Hariga port with a capacity of 110,000 bpd will resume after one week following a two-month blockade due to strikes and protests, but there were scant projections for further restarts.

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