::UN Forces Attack Libya, Oil Price Rise Predicted>>

Go Finance Reporting in SINGAPORE - Sanctions air and sea attacks provided the United Nations (UN) against the Libyan Government troops pushed predicted increase in world oil prices. The impact of the escalation of warfare in Libya beat a decline in demand after the earthquake factor concerns Japan and China's tightening monetary policy.

A fighter of the French fired first attack which is the largest military intervention in the Arab world since the invasion of Iraq 2003. Action was to destroy tanks and armored vehicles in eastern Libya, Benghazi.

As quoted by Reuters, Brent North Sea crude closed at the level of USD113, 93 per barrel late last week has the potential to re-touched its highest level last February, USD119, 79 per barrel. Similarly, U.S. crude oil prices are potentially strengthened so that adds to concerns about global inflation.

"Middle East and North Africa is like a barrel with gunpowder which will eventually burn. Attacks in Libya and sea blockade, was also a problem in Bahrain, which caused tension between Saudi Arabia and Iran, could trigger everything exploded, "said Jonathan Barratt, managing director of Commodity Broking Services.

"If they start to fight each other, it easily will push the market at record highs," he added.

Simmering tensions in the Middle East and North Africa, sparked by a rebellion in Tunisia in January, and spread to other countries such as Egypt, Yemen, Bahrain, and Libya, has triggered oil prices rose 20 percent this year.

Brent crude North Sea almost touched USD120 per barrel in February, its highest level since the spike in 2008. Strengthening the price of Brent oil was suspended in March because of fears of weakening demand caused by the earthquake and tsunami Japan, on Friday last week. Libya is recorded as the largest oil exporter in the world-12 production has dropped dramatically since the riots happened in that country.

Libyan oil production dropped from 1.6 million barrels per day to only 400,000 barrels per day. Oil exports continue to slow and potentially stop along with military action continues. (GoFinance)