Oil rose to near $62 a barrel on Monday, supported by concerns over the escalating conflict with Islamic State militants in Libya and predictions of lower supply levels in the second half of the year.
Egypt’s air force bombed Islamic State targets inside Libya on Monday and Cairo renewed calls for a U.S.-led coalition to confront militants there, a day after the group released a video appearing to show the beheading of 21 Egyptians.
“The geopolitical risk is not something to write off,” said Olivier Jakob, oil analyst at Petromatrix in Zug, Switzerland. Libya’s oil production has mostly shut down, falling to 350,000 barrels per day (bpd) from 1.6 million bpd before the 2011 ousting of leader Muammar Gaddafi.
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