, MADRID, Mar 7, – Libya\’s violent upheaval will not lead to a shortage of oil on the global market because its production can be made up for by increased output in other countries, a senior executive at Repsol, Spain\’s largest oil group, said Monday.
"The world consumes 86 million barrels of oil per day and Libya contributes about two million barrels per day," Repsol\’s director general of upstream activities, Nemesio Fernandez-Cuesta, said in an interview published in the business daily Cinco Dias.
"But the amount of remaining global capacity is around four million barrels, mostly in Saudi Arabia. Therefore, supposing that all the Libyan production did not go to the market, that production could be replaced.
"There should not be a problem of shortage," he added.
World oil prices shot up on Monday, striking a two-and-a-half-year high as Libya\’s uprising against the embattled regime of Moamer Kadhafi continued.
Investors worry that other bigger producers, such as Iran or Saudi Arabia, could be engulfed by similar chaos.
Libya is the fourth biggest oil exporter in Africa after Nigeria, Algeria and Angola, producing around 1.8 million barrels a day, with reserves of 42 billion barrels, according to the International Energy Agency.
The bulk of its oil production is exported to Europe.
Fernandez-Cuesta said reduced production in Libya, which accounts for around 14 percent of Repsol\’s global oil output, is likely to have an effect on the group\’s earnings this year.
"Obviously if we cannot count on Libyan production, the results will be affected but it all depends on how long the conflict lasts," he said.
Repsol operates fields jointly with France\’s Total SA and Austria\’s OMV AG, as well as Libya\’s state-owned oil company.
Last month, Repsol said it had halved its oil production in Libya and evacuated all of its expatriate workers from the country because of the escalating anti-government protests.
Fernandez-Cuesta said the company is working on three possible scenarios — that its workers return to Libya in 15 days, in 30 days or in more than a month.
Repsol has been present in Libya since the 1970s. In July 2008 it signed agreements with the Libyan National Oil Corporation (NOC) to extend to 2032 its existing contracts to produce and explore for oil in the country.