* FTSEurofirst 300 index ends down 1.1 pct
* Automakers, airlines pressured by rising crude prices
* Oil majors slip on production worries, OMV off 5.8 pct
By Harpreet Bhal
LONDON, Feb 23 (Reuters) - European shares extended losses
to a third straight session on Wednesday, with concerns growing
that higher crude prices could erode global growth as investors
saw no quick end to the crisis in oil-rich Libya.
The pan-European FTSEurofirst 300 <> index of top
shares ended down 1.1 percent at 1,152.04 points, its lowest
close in more than three weeks.
Deepening political unrest in Libya pushed Brent crude
futures <LCOJ1> above $110 a barrel, sparking worries a spread
of violence to major oil-producing countries could result in
persistently higher energy prices at the expense of fragile
global growth.
"People are getting much more worried now because it's
spreading and it's unstoppable," said Koen de Leus, strategist
at KBC Securities Bolero in Brussels, referring to the unrest
across the Middle East and north Africa in recent weeks.
"There are two things that you can do: you can either stick
your head in the ground and hope it goes away or just cover
yourself by closing some positions in the equity market and
going into the oil market."
Austrian oil and gas group OMV <OMVV.VI> fell 5.8 percent
after it warned of a temporary fall in Libyan production and
said it could not exclude a complete shutdown. []
Peers with operations in Libya, including ENI <ENI.MI>,
Repsol <REP.MC> and BP <BP.L>, shed 0.3 to 0.8 percent.
Higher oil prices also hit stocks in the auto and airline
sector, according to traders, with Porsche <PSHG_p.DE> down 5.8
percent while Air France-KLM <AIRF.PA> and Lufthansa <LHAG.DE>
shed 1.4 and 1.9 percent.
"Key losers in the DAX <> today are auto stocks, which
traditionally come under pressure when the oil price is high,"
Markus Huber, senior trader at ETX capital, said.
VOLATILITY
The sell-off in equities coincided with the VDAX-NEW
volatility index <.V1XI>, one of Europe's main barometers of
investor anxiety, hitting a six-week high.
The higher the volatility index, based on sell and buy
options on Frankfurt's top-30 stocks <0#.GDAXI>, the lower
investors' appetite for risky assets such as stocks.
The FTSEurofirst 300 has lost 2.9 percent in three days as
political tension in Libya escalates, with market reaction more
pronounced than when unrest hit neighbouring Egypt.
By comparison, the index lost 2.1 percent in the two weeks
between the start of protests in Cairo in late January and the
announcement by Egyptian President Hosni Mubarak that he was
stepping down.
"The protests in Tunisia and Egypt were fairly peaceful, but
this (unrest in Libya) really shows how the situation can get
out of hand," De Leus said.
"If the crisis spills over to Algeria or Saudi Arabia then
we could see oil prices of $200 a barrel or more ... and that
will have a huge influence on economic growth."
Strong earnings results, however, helped individual
companies push higher, with tobacco firm Swedish Match <SWMA.ST>
rising 5.6 percent after it posted higher fourth-quarter profits
boosted by cigar sales in the United States.[]
French lender Natixis <CNAT.PA> rose 4.3 percent after its
profits beat estimates, while Credit Agricole <CAGR.PA> added
1.3 percent ahead of results due on Thursday. []
(Additional reporting by Josie Cox; editing by David Hulmes)
