Oil prices are continuing to be effected by ongoing instability in the Middle East, with Brent crude futures for April rising by over $1.

Fighting in Libya looks unlikely to cease, and though Venezuelan president Hugo Chavez yesterday offered a peace plan to the Gadaffi's, it has already been rejected by rebel leaders.

Traders also have new fears over protests beginning in Saudi Arabia, where a day of rage has been planned for the 11th March.

Saudi Arabia is not only the world's biggest oil producer, it is also the main 'swing' producer, which means it can increase or decrease supply at minimal cost.

After having promised to use its spare reserves to make up for the shortfall in Libyan production, which has fallen over 50 per cent to roughly 700 000 - 750 000 barrels a day after many foreign oil workers fled the counrty, there is doubt as to Saudi's ability to honour this.

Brent crude futures were at $115.6 as of 11.30am GMT.