Oil rises, Asian shares dip on Libya worries

London crude prices rose by more than USD 1 and Asian shares edged lower on Monday, as the worsening situation in Libya stirred renewed concern about disruptions to oil production.

The dollar found a steadier footing, having rebounded after hitting a record low against the Swiss franc on Friday, but the mood remained cautious given the tensions in Libya and fears of contagion.

The dollar last stood at 0.9290 francs , steady from late US trade on Friday and above a record low of 0.9229 hit against the safe haven Swiss currency on trading platform EBS on Friday.

The euro slipped 0.3% against the dollar to USD 1.3716 , but the single currency was seen staying in favour ahead of a European Central Bank meeting this week.

"With rising commodity prices, the ECB will likely continue its tough talk on inflation, increasing the probability of early ECB tightening," BNP Paribas analysts wrote in a note.

In Libya, armed rebels who have seized control of Zawiyah, close to the capital Tripoli, were preparing for a counter-attack as Libyan leader Muammar Gaddafi vowed to cling on to his 41-year-old rule.

London crude prices rose by more than USD 1 to near USD 114 a barrel , edging back in the direction of last Thursday's high of USD 119.79, which was their loftiest intraday level since August 2008.

Worries that the surge in oil prices could hurt global economic growth had helped drag equities lower last week, with MSCI's broad measure of Asia-Pacific equities outside Japan having hit its lowest in nearly three months of 454.70 last Thursday.

The MSCI Asia-Pacific index dipped 0.3% on Monday to 460.37, while Japan's benchmark Nikkei share average fell 0.6%.

South Korean shares fell 0.5%, pressured by falls in automakers and shipbuilders.