Another Global Oil Crisis?
Oil markets don’t like surprises. The sudden ousting of Mr. Mubarak and the unrest in Libya, Bahrain, Yemen, Iran and Algeria had added 20% to oil prices by the middle of last week.
How the Middle East protests will alter the oil market: “The big worry is that spreading unrest will culminate in another shock akin to the oil embargo of 1973, the Iranian revolution or Iraq’s invasion of Kuwait. Oil is more global than it was during those previous crises. In the 1970s production was concentrated around the Persian Gulf. Since then a gusher of non-OPEC oil has hit markets from fields in Latin America, west Africa and beyond. Russia overtook Saudi Arabia as the world’s biggest crude supplier in 2009; OPEC’s share of production has gone from around 51% in the mid-1970s to just over 40% now.”
