Khadafy’s death may mean lower-cost gas

Even small interruptions in oil production can have a big effect on price because of the delicate balance of supply and demand. (Pat Carter/Associated Press)

Associated Press / October 21, 2011

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It will still be several months before Libya can export as much oil as it did before it descended into civil war earlier this year. But the killing of Moammar Gadhafi reduces the chance that violence will get in the way as Libya cranks up production again. And as Libyan crude returns, it could lower the price of oil on the international markets and gasoline at American pumps. The type of crude produced by Libya, known as light, sweet crude, is rare. It is especially valuable because it is easier for refineries to convert into diesel and gasoline. Many refineries can’t switch easily to processing other varieties of crude.

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