“While Japan’s crisis overshadowed other news, tensions in the Middle East continued to escalate. Rebel forces in Libya were pushed back to their stronghold city of Benghazi, losing town after town on the way. Gadaffi’s powerful counterattack consisted of armored formations, troops equipped with heavy weaponry and backed by air support. On Thursday, the United Nations Security Council passed a resolution imposing a no-fly zone over Libya and authorizing “all necessary measures” to protect civilians. This was followed by Saturday’s assault upon Libya by a coalition consisting of French, U.S. and British forces acting in response to continued attacks on civilians by the Gaddafi regime.
Tensions in the Middle East caused oil prices to climb, with West Texas Intermediate Crude gaining 1.7% and ending the week at $103.24. We have been watching the $105 level as a target for initiating a short position in oil.”