How Supply Outages Affect Crude Oil Prices
The EIA (U.S. Energy Information Administration) estimates that Libya’s crude oil production rose by 160,000 bpd (barrels per day) to 1.0 MMbpd (million barrels per day) in July 2017 compared to the previous month.
Nov. 20 2020, Updated 4:06 p.m. ET
Libya’s crude oil production and supply outage 
The EIA (U.S. Energy Information Administration) estimates that Libya’s crude oil production rose by 160,000 bpd (barrels per day) to 1.0 MMbpd (million barrels per day) in July 2017 compared to the previous month. Production rose 18.8% month-over-month and 225%, or 700,000 bpd, year-over-year. Production is at a four-year high. Production rose due to the rise in production from Libya’s major oil fields like the Sharara Oilfield.
Meanwhile, production has dropped in the Sharara Oilfield to between 130,000 and 150,000 bpd as of August 15, 2017. Production was at 280,000 bpd during early August 2017. Production fell due to security concerns including the theft of cars and mobile phones, which caused difficulty in accessing the oilfields. A fall in production due to supply outages in Libya is bullish for crude oil (IXC) (FENY) (USL) prices. Higher crude oil (IYE) (FXN) prices have a positive impact on oil producers like Continental Resources (CLR), Stone Energy (SGY), and Sanchez Energy (SN).
Nigeria’s crude oil production and supply outages 
The EIA estimates that Nigeria’s crude oil production rose by 100,000 bpd (barrels per day) to 1.7 MMbpd (million barrels per day) in July 2017 compared to the previous month. Production rose 6.4% month-over-month and 23%, or 310,000 bpd, year-over-year. Production is at a 17-month high.
On August 11, 2017, Shell’s (RDS.A) oil production facility in the Niger Delta was stormed by hundreds of people demanding jobs and infrastructure development. Production was shut down for the fifth straight day. Any fall in Nigeria’s crude oil production is bullish for crude oil (XLE) (XOP) prices.
The EIA estimates that WTI and Brent crude oil prices will average $48.8 per barrel and $50.71 per barrel in 2017, respectively. Read Crude Oil: Price Forecasts and Hedge Funds’ Position for more information on crude oil price forecasts.
Read Will Global Oil Demand Overshadow Ample Supplies? and Refinery Demand and Crude Oil Inventories Drive Oil Futures for more information.
For more on natural gas, read US Natural Gas Futures Near 3-Week High: What’s Next?