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Which companies are affected most by Libyan crude disruption?

Ingrid Pan, CFA

Why unrest in Libya is affecting oil markets (Part 3 of 3)

(Continued from Part 2)

The effects of Libya’s crude disruption

Eni, Italy

Libya makes up more than 10% of global production for Eni, an Italian energy company. As recently as 2012, the company announced plans to invest $8 billion over the next ten years in Libya. Eni has also invested significant amounts of capital in the past, having opened a new field, built a pipeline to export gas directly to Italy, and constructed a new export terminal.

Repsol, Spain

Repsol, a Spanish energy company, also has significant operations in Libya, and produced 44,000 barrels per day in 3Q12. Plus, the company had continued to drill exploration wells earlier this year, signaling long-term commitment to the region.

OMV, Austia

OMV, an Austrian oil company, has also been affected. Its pre-conflict oil production in Libya accounted for ~10% of the company’s production. In early September, the company reported that conflict in the region forced it to halt production.

Other major companies that have been affected

Marathon Oil (MRO), ConocoPhillips (COP), and Hess Corp. (HES) also have significant assets in Libya. Marathon and Conoco both have ~16% stakes in Waha Oil, Libya’s largest foreign oil partnership. Hess has an ~8% stake, with Libya’s National Oil Company owning the rest. Marathon has reported that it’s trying to sell its stake. The increasing unrest could lower the value of these companies’ stakes.

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