To: Wharf Rat who wrote (207398 ) 4/9/2011 2:14:32 PM From: Wharf Rat Respond to of 363404 East and West Libya Besieged Libyan City Gets Aid as U.S. General Sees Stalemate By Patrick Donahue and Tony Capaccio - Apr 8, 2011 1:15 AM PT Libyan rebels and Muammar Qaddafi’s forces are locked in a military impasse, a U.S. general warned, as Nomura Holdings Inc. said that the country’s oil output won’t rebound to pre-war levels when the fighting ends. U.S. Army General Carter Ham, who commanded the opening phase of the allied military operation, told a U.S. Senate committee yesterday that the conflict is in a stalemate and the use of NATO air power is “increasingly problematic” when it comes to hitting regime forces without endangering civilians and opposition fighters. Foreign staff members have fled from Libya’s oil fields since anti-government protests broke out in mid-February and escalated into armed conflict, meaning the country’s oil output would remain below one-third of its previous level in the immediate aftermath of a cease-fire, Michael Lo, a Hong Kong- based analyst at Nomura, wrote in a report. The war in Libya, which holds Africa’s largest oil reserves, has helped push crude prices up more than 30 percent. U.S.-led forces from the North Atlantic Treaty Organization intervened in the conflict after a March 18 United Nations resolution authorizing the protection of civilians. NATO air strikes initially enabled a rebel advance which has been halted by Qaddafi’s forces and reversed in the past week. Friendly Fire Incident Rebels fleeing the oil port of Brega toward the city of Ajdabiya in eastern Libya said their tanks and a convoy were mistakenly hit NATO fighter jets, the Associated Press reported. At least five rebels were killed and more than 20 injured, AP said. The insurgents have complained that air strikes have given them less protection since the U.S. handed control of operations to NATO, and are demanding more support. NATO says it’s investigating the incident. The U.S. and allies have debated arming the rebels, without announcing any decision. Sending arms is not a good idea until U.S. officials have a “better understanding of exactly who the opposition force is,” Ham said. He also cited the rebel-held city of Misrata, that’s besieged by Qaddafi loyalists, as the main failure of NATO policy, saying air strikes haven’t been able to end the siege. An aid ship chartered by the UN Food Program reached Misrata through fighting in the port to deliver food, medicine and water purification equipment. Former Libyan Energy Minister Omar Fathi bin Shatwan, who fled to Malta on a fishing boat April 1, described Misrata in an interview as a city where “there is no food or medicines, there is nothing but fear and dead bodies all over the place.” Oil Rises Crude oil closed at a 30-month high and extended gains today, adding 0.9 percent to $111.25 a barrel at 8:40 a.m. in London. “If all the Libyan national oil company-operated fields were to join the rebels and production goes into full swing, total production can likely reach only 450,000 barrels a day, 28.5 percent of pre-crisis levels,” according to Nomura’s Lo. “The remaining fields were operated by independent oil companies, who have fled the country,” he wrote. “The shortage of human capital makes it difficult to bring all the fields back into production.”bloomberg.com