Commodity Corner: Oil Falls on Libyan Rebels' Apparent Progress
Crude oil for May delivery fell $1.42 Monday as news reports indicate that Libyan rebel forces made important advances over the weekend.
Oil settled at $103.98 Monday after the rebels—aided with NATO member countries' airpower—reportedly made great strides in a westward campaign. The rebels recaptured important oil facilities and even made inroads toward overtaking Muammar Gadhafi's stronghold and hometown of Sirte.
The progress even led a rebel spokesman to tell the Agence France-Presse news agency that Libyan oil exports could begin again within a week, according to a Dow Jones Newswires article. Should exports resume, it is unlikely that Libya would return to its pre-civil war oil production rate of 1.3 million barrels per day anytime soon. Without NATO's enforcement of a no-fly zone, rebel forces would face a much more daunting challenge against Gadhafi's well-armed loyalists.
Oil futures fluctuated from $103.60 to $105.76 Monday.
Although the Upper Midwest and Northeast regions of the U.S. continue to cope with unseasonably cold temperatures, April natural gas lost three cents Monday to settle at $4.37 per thousand cubic feet. Natural gas hit a seven-week high Monday, but with the pre-summer "shoulder season" for gas underway traders were pessimistic that prices would get much higher than they have recently.
Front-month natural gas traded within a range from $4.37 to $4.475 Monday.
April gasoline ended the day at $3.03 a gallon, down a penny from the previous session. Gasoline peaked at $3.06 and bottomed out at $3.01 during Monday's trading.