The global oil prices have hit a 10-month high, going to more than $92 per barrel on Tuesday due to the energy market bracing for supply disruptions due to the catastrophic flooding disaster in Libya.
The disaster has resulted in at least 2,000 casualties, and officials noted that there are an estimated 10,000 who are still missing. The destructive flooding broke dams and swept away countless homes within the region.
Oil Prices Hit 10-Month High
The world benchmark for oil, Brent crude, jumped nearly 2% to an intraday high of $92.38 per barrel. This is the highest price that has been seen since Nov. 17, 2022. Additionally, U.S. oil prices popped 2.3% to as much as $89.29 per barrel, the highest seen since November last year.
The latest rally for oil prices is expected to continue to push up prices at the pump for consumers, resulting in higher inflation across the U.S. economy. According to CNN, analysts blamed the situation on the flooding in Libya because it would temporarily disrupt oil exports from that OPEC nation.
The OPEC said that Libya was known for producing roughly 1 million barrels of oil per day in August. Lead oil analyst for the Americas at Kpler, Matt Smith, said that the country has several ports that cannot export because of the current situation. He added that it is another thing to add to the bullish side of the ledger for crude.
The flooding in the North African country comes only a week after Russia and Saudi Arabia sent oil prices skyrocketing after announcing plans to extend their aggressive supply cuts. This week, gasoline prices have edged even higher due to that announcement.
On Tuesday, the national average for regular gasoline was at $3.84 per gallon, an increase from $3.81 seen a week ago. Now, gas prices are 12 cents higher compared to the same point last year.
Libya's Flooding Disaster
Emergency workers in Libya also uncovered more than 1,500 bodies in the wreckage of the eastern city of Derna on Tuesday. Officials also expressed concerns that the death toll could surpass 5,000 after floodwaters smashed through dams and washed away entire neighborhoods of the city, according to the Associated Press.
The tragic death and devastation caused by the Mediterranean storm Daniel showed just how powerful it was. Additionally, it showed Libya's vulnerability, which has been torn apart by chaos for more than a decade.
Currently, the nation is divided by rival governments, one in the east and another in the west. As a result of the situation, there has been constant neglect of infrastructure in many areas.
The dams in Derna have not been maintained for more than two decades, and the city's infrastructure was not built to withstand the powerful forces of the flooding disaster. The city's deputy mayor, Ahmed Madroud, said that the destruction left by Daniel will be difficult to repair, said Aljazeera.
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