Events in Libya are unfolding very quickly as International Oil companies repatriate their staff, against a backdrop of fighter planes shooting at protestors and Global Equity markets are covered in a sea of red as a result.
In Europe, Italy has closer connections to Libya than most of it's neighbours and this is reflected in a larger drop in their equity values and interestingly, the Italian stock market is not open this morning due to a "technical problem".Libya accounts for around 2% of world oil supplies only, that puts it around 18th in the league of oil suppliers but the prospect of a civil war has driven traders to cover any short positions, as oil prices hit highs not seen for over two and a half years.
Any price over US$100 per barrel is seen to damage the world economy significantly and the price of the benchmark Brent Crude is now close to US$108.
Libyan leader Gadaffi was seen on local TV yesterday in a very brief broadcast, stating that he was in fact in Tripoli, not in Venezuela as some rumours placed him.
Outside of Libya, two Iranian gunboats currently heading for Syria through the Suez canal have done nothing to calm fears of Middle East contagion, as Israel see this as a provocative act.
On the back of this uncertainty, the price of gold is moving higher and silver is at a 30 year high as investors move into more tangible assets with less risk attached to them.