Crude Oil Jumps 10% As Libya And Middle East Issues Escalate

While the US Markets were closed yesterday, oil and other commodities continued to trade. Crude oil jumped more than 10% since last friday and is now nearing $100 per barrel. Any it may not be over just yet…

We’ve posted twice before on both Crude Oil Demand and Crude Oil Inventories. Each time we highlighted the fact that supply and demand data signals strong oil price gains for the next couple years. Throw in the recent escalating tensions and protests in Libya and other Middle East countries and we could see oil prices continue to jump very fast.

‘Rivers Of Blood’ – Is He Serious?

Seems we all sometimes lose sight of what’s happening around that world that could possibly effect our perfect bubble world. I myself have a hard time trying to filter nonsense and fact on a daily basis.

Which stories are important to watch and pay attention to and which are just regular “news”?

Per Bloomberg:

Libya erupted into violence last night after Muammar Qaddafi’s son threatened “rivers of blood” and deployed security forces on protesters, some of whom claimed control of the second-biggest city, Benghazi.

At least 250 people died in Tripoli alone, al-Jazeera reported, citing witnesses. Troops attacked “terror” hideouts and urged citizens to fight back the “organized gangs that are destroying Libya,” state television said. Amid the violence were signs that some officials and troops were deserting.

The increasing violence in the Middle East is a story we all should closely follow. If nothing else you should at least understand how it could effect our oil markets and broader economy. My gut tells me that things are going to get much worse over there before it gets better.

Where Do We Get Our Oil?

I was actually curious as to where most of our oil comes from and the facts may surprise you. According to the EIA, Canada remained the largest exporter of total petroleum in November, exporting 2,510 thousand barrels per day to the United States, which is an increase from last month (2,345 thousand barrels per day). The second largest exporter of total petroleum was Mexico with 1,363 thousand barrels per day.

Most of you would assume after looking at these numbers that we are relatively sheltered from any major issues. But we all have to keep in mind that oil is globally traded and any tensions in the Middle East will surely effect our own domestic prices.