* Uncertainty surrounds Libyan truce declaration
* Yemen president declares state of emergency
* Coming up: CFTC positions data, 3:30 p.m. EDT Friday
(Recasts, updates prices, adds detail)
By Robert Gibbons
NEW YORK, March 18 (Reuters) - Oil prices slipped on Friday
in volatile trading on uncertainty surrounding Libya's
cease-fire after a UN resolution authorized a no-fly zone.
Both Brent and U.S. crude futures pulled back several
dollars after Libya's government declared a unilateral
cease-fire in its offensive against rebels. []
Uncertainty about the stability of any cease-fire limited
the price drop amid reports that Gaddafi's forces continued to
fire at rebel-held towns. [] []
Oil prices were buffeted earlier, with prices slumping
briefly, after China's central bank said it would raise
lenders' required reserves, another move to rein in inflation.
[]
Brent crude futures for May delivery <LCOc1> fell 60 cents
to $114.30 a barrel by 12:28 p.m. EDT (1628 GMT), off an
earlier $117.29 peak.
U.S. crude futures for April delivery <CLc1> fell 20 cents
to $101.22 a barrel, off its high of $103.66, but having
bounced off a $100.32 low.
Total U.S. and Brent crude trading volumes were heavy,
already surpassing 400,000 lots, after prices jumped nearly 4
percent on Thursday in some of the year's lightest volumes as
the market weighed the potential impact of Libya's conflict,
Middle East tensions and Japan's nuclear crisis.
"This does not mean we are near a resolution of the
situation in Libya. We may be facing the possibility of an
entrenched status quo between pro and anti Gaddafi groups,"
said Harry Tchilinguirian, analyst at BNP Paribas.
"This only maintains the uncertainty in terms of when we
will eventually have a full resumption of production in
Libya."
Libyan authorities must comply with all elements of the
United Nations resolution on the end of hostilities, UN
Secretary-General Ban Ki-moon said at a news conference in
Madrid. []
France said it remained cautious as the threat on the
ground in Libya had not been lifted and Britain said Gaddafi
would be judged by his actions rather than his words.
[] []
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Libya no-fly zone graphics http://link.reuters.com/wub68r
More on Middle East unrest: [] []
Western forces in region http://link.reuters.com/jen38r
Latest graphic: http://r.reuters.com/nym77r
Interactive factbox http://link.reuters.com/puk87r
Graphic on air bases http://link.reuters.com/zyk48r
Graphic on missile defences http://link.reuters.com/wem48r
Graphic on no-fly zone http://link.reuters.com/wub68r
Breakingviews-Crude bullied by black swans []
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VOLATILE MIDDLE EAST
While Libya's conflict pushed markets around, unrest in the
Middle East also provided uncertainty.
Yemen's president declared a state of emergency after at
least 25 protesters were killed at an anti-government rally.
[]
A crackdown by authorities in Bahrain against Shi'ite
protesters demanding the reform from the Sunni monarchy, drew
criticism from the United States and Iran.
Sunni-ruled Saudi Arabia, OPEC's top oil exporter, sent
troops into Bahrain earlier this week along with other forces
from the Gulf Cooperation Council (GCC).
Eyeing the region's growing unrest, Saudi Arabia's King
Abdullah announced on Friday $93 billion in handouts and
boosted its security apparatus. []
A violent crackdown on demonstrators also came in Syria on
Friday. []
JAPAN CRISIS ALSO UNCERTAIN
Japan's earthquake, tsunami and resulting nuclear reactor
crisis pulled back oil prices after unrest in the Middle East
and North Africa drove oil prices to a 2-1/2-year highs, with
Brent nearing $120 last month.
Risk-averse sentiment increased as Japan struggled to
prevent catastrophic radiation releases from its quake-damaged
nuclear reactors.
(Additional reporting by Gene Ramos in New York, Nia Williams
in London and Alejandro Barbajosa in Singapore;editing by
Sofina Mirza-Reid)
