On Monday, Brent crude prices rose by 2.64%, reaching $81.11 per barrel, while West Texas Intermediate (WTI) saw a 2.83% increase, closing at $76.95 per barrel.
Globally, oil prices for October delivery surged by around 3% following the suspension of exports by the Libyan government.
Although the Benghazi government is not internationally recognized, it controls most of Libya’s oil fields. The National Petroleum Corporation, based in Tripoli and responsible for managing Libya’s oil resources, has yet to confirm the export suspension.
Libya’s ongoing power struggle over control of the central bank and oil revenues has intensified concerns in the oil market.
UBS analyst Giovanni Staunovo warned that the biggest risk is a further decline in Libyan oil production due to escalating political tensions, potentially reducing output from the current 1 million barrels per day to zero.
Additionally, commodity prices had already closed higher on Friday, following signals from Federal Reserve Chair Jerome Powell about the imminent start of interest rate cuts.
Analysts from ANZ noted that the prospect of easing monetary policy has bolstered sentiment across the commodities market, according to CNBC.
