By Saikat Chatterjee
HONG KONG, March 7 (Reuters) - Crude oil prices rose to
2-1/2 year highs as worries about supply disruption increased
due to deepening unrest in Libya, while Asian stocks slipped on
Monday as concerns about the Middle East also weighed on
equities.
U.S. crude hopped above the $105 a barrel line to
reach its highest level since September 2008 as a
counter-offensive by Libya's Muammar Gaddafi against rebels
raised concerns that Africa's largest biggest holder of oil
reserves is sliding into civil war.
Gold , often sought in times of geopolitical tensions,
rose to near a lifetime high at $1,434.60 an ounce, while silver
surged 3 percent to 31-year highs as investors piled into safe
havens. It hit a record $1,440 last week.
A reasonably strong batch of U.S. data that showed the
jobless rate falling to a near two-year low failed to boost
sentiment, as investors remained firmly focused on the
developments in the Middle East and the resulting longer-term
impact on oil. .
While a 22 percent rise in U.S. oil prices over the last two
weeks has failed to have a significant impact on Asian stock
markets so far, market players worried that further sharp price
increases may stifle growth and fuel inflationary pressures.
"With strong, but not spectacular, U.S. payrolls we're
seeing more signs of global recovery, but in the long term, high
oil prices can threaten the earnings of Japanese companies and
that's what investors are concentrating on now," said Mitsuo
Shimizu, deputy general manager at Cosmo Securities in Tokyo.
Tokyo's Nikkei average fell more than 1 percent,
while stocks else where in Asia dipped 0.2
percent. South Korea's KOSPI was a shade lower while
Australia's S&P/ASX 200 index was down nearly 1 percent.
Wall Street erased most of its weekly gains on Friday, with
the S&P 500 Index falling by 0.74 percent, as fears of
more geopolitical turmoil overshadowed positive U.S. data. The
CBOE Volatility Index VIX , Wall Street's so-called fear
gauge, rose 2.7 percent to 19.11.
In currency markets, the dollar struggled against a basket
of major currencies after failing to get a big boost from
the U.S. data, while the euro was supported on
expectations of an interest rate hike next month from a hawkish
European Central Bank.
(Additional reporting by Ian Chua in SYDNEY and Antoni
Slodkowski in TOKYO; Editing by Alex Richardson)
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