* At least three firms shut in Libyan output
* Gas pipeline and oil export terminals disrupted
* Concern other big producers could suffer supply outages
* For a 24-hour technical outlook on oil: http://graphics.thomsonreuters.com/WT/20112302083814.jpg
* Coming up: January U.S. existing home sales data
(Updates prices, analyst comments, technicals, crude inventory
data)
By Francis Kan
SINGAPORE, Feb 23 (Reuters) - U.S. crude futures climbed to
a 2-1/2-year peak on Wednesday on concern that unrest in Libya
could spread to other top oil producers in the region and cut
more output.
Violent clashes in Libya have resulted in at last three oil
companies halting output in Africa's third-largest producer,
which pumps 1.6 million barrels per day (bpd), or nearly 2
percent of global supply.
The disruptions mark the first reduction in oil supply
stemming from a wave of protests that have swept through the
oil-producing Middle East and North Africa. Investors fear for
the potential impact on the flow of oil from top exporter Saudi
Arabia if it suffers similar unrest.
U.S. crude rose as high as $96.08 a barrel, the
highest level since October 2008. By 0459 GMT, the April
contract had trimmed gains to trade at $95.48, up 6 cents on the
day.
Brent crude rose 58 cents to $106.36 a barrel, after
rising as high as $106.58 earlier. On Monday, Brent hit a
2-1/2-year high of $108.70.
"Even if Libya completely shuts down, there isn't a supply
issue. But the (U.S. crude) could go to $100, given the
potential for this contagion to spread to Saudi Arabia," said
Jonathan Barratt, managing director of Commodity Broking
Services in Sydney.
To date, protests in Saudi have been low key. But majority
Shi'ites in neighbouring Bahrain are protesting against the
Sunni-led government and there is concern this could spill over
to the Shi'ite minority living in Saudi Arabia's oil-producing
eastern province.
A pipeline pumping Libyan gas to Italy was also closed, and
operations at Libya's export terminal operations disrupted.
Libyan leader Muammar Gaddafi has refused to step aside despite
the growing revolt and threatened tougher action against
protesters in a defiant speech on Tuesday.{ID:nLDE71L2LE]
Most European product prices extended gains on Tuesday, with
traders reporting Libya had declared force majeure on fuel
shipments from some ports, while others said cargoes were
loading as normal.
International Energy Agency (IEA) chief economist Fatih
Birol said on Tuesday that oil prices were in the danger zone
and could rise further if turmoil continues in the Middle East.
"The global economy is more fragile now than it was in 2008.
Growth has been driven by stimulus packages and austerity
measures. I don't see it being able to absorb a rise to $140
like it did two years ago," Barratt said.
Brent crude has risen more than 13 percent so far this year.
U.S. crude is up over 2 percent on the year, but is over $50
below its 2008 high of $147.27.
"Given the speed at which events are unfolding, we do not
rule out a further spike of $20/bbl or beyond in the coming
weeks if the unrest disrupts output," ANZ commodities analysts,
Serene Lim and Mark Pervan, wrote in report.
Brent oil could revisit its Monday's high of $108.70 a
barrel while he sees U.S. crude head to $97.33 a barrel in the
next 24 hours, according to Reuters market analyst Wang Tao.
NO MORE CRUDE FROM SAUDI
Top exporter Saudi Arabia on Tuesday stopped short of
pouring more oil on to markets, telling visiting consumer
nations prices were driven by fear.
The kingdom could ramp up its oil production enough within
one month to replace all of Libya's crude exports if growing
strife in the African nation cuts off its oil shipments, a
senior U.S. government energy official said on Tuesday.
Saudi Arabia supplies around 10 percent of the world's oil,
but also holds most of the world's spare capacity. It is the
only producer able to respond quickly with large volumes of oil
to compensate for a serious supply outage.
IEA member states would consider releasing oil from their
emergency stocks if supplies were disrupted as a result of
continuing turmoil in the Middle East, Birol said.
The IEA is adviser to 28 industrialised nations on energy
policy.
A rise in Japanese crude oil stocks and an expected increase
in U.S. inventories could also ease supply concerns, analysts
said.
Asian stocks were flat to slightly lower on Wednesday,
following Wall Street's worst performance since August on
concerns over the turmoil in Libya.
(Editing by Ed Lane)
