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Trading in a heavier oil north sea crude was up 2.5 percent to $105 a barrel and with violence worsening in libya several oil companies are pulling personnel from the country according to the agency, the unrest has shut down 50,000 barrels of production. >>shepard: is there a sense how bad it could become? >>reporter: experts are not panicking, there is excess production capacity around the world that can offset a big decline of production in libya. for example, saudi arabia has four million barrels of excess capacity a day. right now, compared to the 1.4 million barrels a day of total product...

Our intellectual property and flooded the market with excess capacity of steel and aluminum. you can see the numbers there. this has driven down the prices worldwide and driven great u.s. companies out of business. the china communist regime ends up distorting the global marketplace. they are not efficient the way they operate. the president reiterated in pennsylvania look, they don't have a hand on the trade issue either. right now we are running $150 billion trade deficit with the e.u. they put up unfair barriers to the agriculture products, massive sub didties to -- subsidiaries and they ha...

Have -- >> let me stop you there. excess capacity basically is economic english for -- >> too much stuff. >> also automation, right? >> that's potentially one source. really good point, jeff. let's talk about the first order of excess capacity. you don't have a lot of demand for the widgets you make so, let's say you shut down part of the factory floor. that's excess capacity. no reason to go out and build new plant and equipment if part of the old plant and equipment is sitting there idle. you're also right on the front of automation. if suddenly you create a machine that makes widgets with m...

Supposed to take. >> can i make my own analogie analogies, now, we have a bigger issue here, and we know to gary b's point. we have enough oil in both anwar and on shore, that at the margin, prices, yes, are hit by the incertainty. but at the margin, it's the new oil that's coming on that's available and the amount of every day excess supply that would bring us down to the 85 and $75 price point and we can do it now in the united states and we have the shale oil revolution and we have the keystone pipeline that would actually bring another 2 million barrels and we could have 5 million extra ba...