IMF Warns on Sustained High Oil Prices

Source:

"Crude oil shipments from Libya are at a virtual standstill."

The head of the International Monetary Fund warned on Monday that global economic growth could suffer if the price of oil stays at its current high level for an extended period.

Oil prices jumped toward $120 a barrel last week for the first time since 2008 as a revolt against Libyan leader Muammar Gaddafi has hit crude exports from the country, which is the world's 12th largest producer.

"I am concerned," said IMF Chief Dominique Strauss-Kahn, during a visit to Panama. "The hike to something, which is between $110 and $120 a barrel, is something which may affect [growth] if it lasts too long."

At the same time, Strauss-Kahn said oil prices were not likely hitting growth yet. "We are not there today," he said.

Oil prices have eased in recent days, partly because top world exporter Saudi Arabia has promised to meet any shortages.

Crude oil shipments from Libya are at a virtual standstill, shipping sources said on Monday.

Gaddafi's forces have been trying for days to push back a revolt that has won over large parts of the military, ended his control over eastern Libya and is holding the government at bay in western cities near Tripoli.

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