LONDON—Crude-oil futures held steady, as oil producers appeared ready to make good on promises to replace reduced production in Libya, where a rebellion against leader Moammar Gadhafi has shut down over half of the country's oil output.
However, the market remained on edge as Oman, also an oil exporter, became the latest country to see anti-government protests.
The front-month Brent contract for April delivery on London's ICE futures exchange was down 23 cents, or 0.2%, at $111.91 a barrel. April futures on the New York Mercantile Exchange were trading up up cent at $97.89 a barrel.
Civil unrest in Libya showed no signs of easing, with rebels controlling much of the country but forces loyal to Col. Gadhafi maintaining a tight grip on the capital, Tripoli. Oman saw anti-government protests over the weekend, as demonstrators took to the streets demanding jobs and political reforms. Protests continued Monday, after local police killed at least two people.
Oman, like Libya, is an oil exporter. Libya's top oil official said Monday that the country's total output has declined by more than half. The country exports about 1.3 million barrels a day of high-quality oil. An official with the country's 220,000-barrel-a-day Ras Lanuf refinery separately said the facility had declared force majeure on its product exports, invoking a clause used when conditions of a supply contract cannot be met.
However, Saudi Arabia has increased its crude production to offset the supplies lost because of the crisis in Libya, according to oil officials in the kingdom. The kingdom is producing 9 million barrels a day, an increase of between 500,000 and 600,000 barrels a day, the officials said. A top official at Kuwait Petroleum Corp. said the Organization of Petroleum Exporting Countries member could also raise output if needed.
The market is "still evaluating the impact of the disruptions in Libya" but news that Saudi Arabia and Kuwait "will increase their production will help offset the loss" of Libyan crude and add balance to the market, said Olivier Jakob from Petromatrix.
With the market currently well-supplied but uncertain about the future, prices held close to where they stood at the close of trading on Friday after retreating from an earlier rally. Brent crude had reached $114.50 a barrel, while Nymex futures rose to $99.96 a barrel.
"This week prices will depend on what happens outside of Libya as we are seeing more talk of protests in other countries in the region," said Simon Wardell from IHS Global Insight.
ICE March gasoil traded $3.25, or 0.4%, higher at $924.50 a metric ton. Nymex March gasoline traded down 1.27 cents, or 0.5%, at $2.7268 a gallon.
—Geraldine Amiel, Benoit Faucon and Tahani Karrar-Lewsley contributed to this article.
