Oil Prices Plunge as Libya Boosts Exports

July 12, 2018 at 1:39 AM

Oil futures suffered sharp one-day declines on Wednesday over news that Libya plans to raise its petroleum exports.

Brent crude, the global benchmark, plunged almost 7% to $73.40 per barrel, its greatest decline in more than two years. The U.S. standard, West Texas Intermediate, slid 5% to $70.38, its biggest drop in 12 months.

Crude oil had been enjoying a rally that pushed prices earlier in the week to their highest level in four years. The increase was driven by a combination of production issues and lower inventories.

Yesterday’s drop also was affected by Saudi Arabia’s announcement that its oil production in June bounced back to its highest level in two years.

The increase follows a decision last month by the Organization of the Petroleum Exporting Countries to end cutbacks launched at the beginning of 2017 to reduce a global glut. The maneuver successfully pulled oil prices out of a $29-per-barrel slump.