Oil on the boil again as unrest spreads to Libya

Oil is at a two-year peak as violence intensified in Libya, stoking concerns over disruption of crude supplies with the unrest escalating around the Middle East and North Africa.

Futures for April delivery in New York were up as much as 9.8 per cent from the 18 February settlement and London-traded Brent soared to the highest since September 2008, as soldiers deserted Libyan leader Muammar Qaddafi's government and diplomats resigned. According to Goldman Sachs Group Inc, Brent may trade between $105 and $110 a barrel in coming weeks if the situation does not ease.

Libya is the eighth-largest producer of the OPEC countries, which pump around 40 per cent of the world's oil.

Qaddafi said he had not fled the country in the wake of government forces attacking protesters while rebels claimed control of Libya's second-largest city, Benghazi.

According to the International Federation for Human Rights more than 300 people have died.  Saif al-Islam Qaddafi, Qaddafi's son, warned that ''rivers of blood'' would flow unless the uprising ended.

Shokri Ghanem, chairman of Libya's National Oil Corp said he had no information about a disruption in crude production. Al Jazeera yesterday reported the country's Nafoora oil field had stopped production due to an employee strike.