Stocks fall, oil jumps as Libya protests intensify
NEW YORK (AP) — Stocks fell sharply today and oil prices spiked as investors became worried about increasingly violent protests in Libya.
Oil prices rose 6 percent to $95 a barrel after the uprising threatened the country’s oil production. Libya is the world’s 18th largest oil producer, accounting for 2 percent of global daily output. It also sits atop the largest oil reserves in Africa.
At least 250 people have been killed in Libya so far, according to the U.N. Office of the High Commissioner for Human Rights. Key government officials have resigned and air force pilots have defected following a crackdown on protests in Tripoli, Libya’s capital.
Traders are worried that the unrest will spread to other oil-rich countries in the region or lead to higher gas prices for consumers. Governments in Libya’s neighbors Tunisia and Egypt have fallen in the past month and protests are continuing in other countries in the region including Yemen and Bahrain.
Alan Gayle, senior investment strategist for RidgeWorth Investments, said the deepening unrest in the Middle East is bringing back concerns that crude oil prices could surge. “This puts a damper on consumer optimism, which is really critical at this stage of the recovery.”
The Dow Jones industrial average fell 50 points, or 0.4 percent, to 12,341 in morning trading.
The Standard & Poor’s 500 index fell 9, or 0.7 percent, to 1,334. The Nasdaq composite index fell 32, or 1.1percent, to 2,802.