* About 25 percent of Libyan oil output shut
* Worries persist over Mideast, North Africa outages
* Coming Up: API crude inventory data at 2130 GMT
(Recasts, adds new by-line, changes dateline previously
LONDON)
By Gene Ramos
NEW YORK, Feb 23 (Reuters) - Brent crude futures rallied
above $110 a barrel on Wednesday, posting the biggest three-day
percentage gain in a year, as the escalating violence in Libya
could further reduce its production.
Between 300,000 and 400,000 barrels per day of Libyan
output -- up to 25 percent -- has been shut down, according to
Reuters calculations, marking the first cut in oil supplies
related to the recent wave of anti-government unrest in North
Africa and the Middle East.
After Libyan leader Muammar Gaddafi vowed in a defiant
speech on Tuesday that he would not step down, promising severe
punishment to his detractors, analysts fear that long-lasting
supply disruptions or even permanent damage lies ahead for the
OPEC member's oil industry. []
Traders were intently watching what top OPEC exporter Saudi
Arabia will do, even as its oil minister has reiterated
assurances the kingdom and other OPEC members would be ready to
act should a supply shortfall develop. []
"I don't think Libya alone will take us to $150 a barrel,
but, if unrest spreads in the Gulf countries, we could easily
get there. That is why it is imperative the Saudis release some
extra barrels into the market now to calm the situation, rather
than simply trying to talk the price down," said Edward Meir,
an analyst at MF Global in New York.
In London, ICE Brent crude for April delivery <LCOJ1>
gained $4.01, or 3.8 percent, at $109.79 a barrel. Earlier, it
touched a session high of $110.35, the highest since Sept. 2,
2008, when prices hit $110.45.
In three days, the Brent contract has surged nearly $8, or
7.8 percent, the biggest three-day percentage advance since
February 2010.
In New York, the new front-month, April crude <CLJ1> rose
$2.48, or 2.6 percent, to $97.90 a barrel. It earlier reached
$98.07, the highest intraday price since Oct. 2, 2008, when
prices hit $100.37.
Since resuming trading on Tuesday, following a long holiday
weekend, U.S. crude has advanced nearly $12, or nearly 14
percent, the biggest two-day percentage gain since January
2009.
Brent's premium against U.S. crude <CL-LCO1=R> widened to
as much as $12.84, after posting $10.36 at the close on
Tuesday.
Traders were gearing up for U.S. weekly inventory data, the
first of which will be released by the industry group American
Petroleum Institute later Wednesday at 4:30 p.m. EST (2130
GMT)
A Reuters poll forecast that U.S. crude stockpiles rose 1.3
million barrels last week, while distillate inventories fell
1.4 million barrels and gasoline supplies rose 400,000 barrels.
[]
(Additional reporting by David Sheppard in New York; Zaida
Espana in London, Francis Kan in Singapore; Editing by Walter
Bagley)
