• OPEC production fell 411,000 barrels per day to 29,343 million bpd.
• Libya's production fell 343,000 barrels per day, from 1,396,000 bpd.
• Nigeria fell 107,000 barrels per day due to Royal Dutch (RDS) Oil maintenance.

Definitely not-for-the-squeamish Delta Air Line's (DAL) stock has plunged in bear-hug fashion during the winter to $9.80 from $14.70, and is now dangerously close to the sell/stop loss at $8.

Delta Air Lines, first discussed here on July 19, 2010, at a price of $10.73, would likely have been a leader of a rejuvenated airline sector until Middle East unrest, including the ongoing civil war in Libya, sent oil prices above $105 per barrel. That crude surge has pushed jet fuel prices -- typically the second biggest or biggest expense for an airline -- substantially higher.

With several major developments occurring around the world, many investors may wonder how they could affect their portfolios or their lives. Here are two of the current, newsworthy events and how investors may interpret them.

Libya

The oil from Libya totaled about 2 million barrels a day before the revolution, half of which was exported. About 1 million barrels a day are no longer available to the world. That isn't enough to really affect the price of oil for a long period of time. Plenty of other countries can supply that amount without straining their capacity. But they're unlikely to step in to fill the gap when oil prices are above $100 a barrel. That price should recede once the conflict finishes and a more stable government is in place.

Gas prices are rising and show no signs of coming back down. In fact the predictions are for higher prices to come. At the moment, gasoline averages $3.542 per gallon, according the the AAA motorist group, as reported by CNNMoney.

The highest recorded nationwide price was $4.114 on July 17, 2008. Forecasters are looking for the $4.00 per gallon marker to be hit by this summer.

The Department of Energy has had to up its forecast its forecast for oil prices for 2011 and 2012 from last month. The updated forecast takes into account the loss of one million barrels per day from the Libyan conflict, The Wall Street Journal reported.

Last month, the DOE's Energy Information Administration's (EIA) estimate for West Texas Intermediate (WTI) crude was $91 per barrel for 2011. Now, EIA forecasts WTI crude to average $102 per barrel in 2011 and $104 per barrel in 2012. The EIA qualified its forecast with this statement: "There is significant uncertainty surrounding this forecast."

The game is changing. It's time to play defense. Two weeks ago the U.S. stock market was in a bullish trend with no end in sight. Now international events are taking center stage. How long the markets can ignore these events is the question of the day.

Brent crude oil is trading at $116 per barrel. This has serious implications for the U.S. economy. If you recall, when oil spiked in 2008, it was a major factor in the recession that followed. People simply could not afford the price of gas and slowed their driving dramatically. We must remember that many people commute 50 to 70 miles a day just to go to work. The money is coming out of the household budget. Some people spend more in gas than they do working, especially if they work part time.

The turmoil in the Middle East is spreading as protests surge throughout the Arab world. This is not a one country phenomenon -- and it won't go away any time soon.

The great fear for the West is that the unrest will spread to other oil-producing countries. Half of Libya's oil production is shut down. Protests in Iran -- the second largest oil producer in OPEC -- are growing. Saudi Arabia's King Abdullah is giving away $36 billion to his people in the hope of warding off further unrest.

The turmoil in the Middle East is getting worse by the day. Protesters now control a good portion of Libya. The panic is spreading to Saudi Arabia where King Abdullah is handing out $36 billion in housing support and funding to offset inflation, according to the Wall Street Journal.

So the number crunchers are putting together possible "what-if" scenarios for the oil market. One such possibility is: What if Algeria joins Libya in revolt. Both countries produce 4 million barrels of oil per day. If such events develop, oil could surge to $220 per barrel, according to Nomura Securities in the Wall Street Journal.

Delta Air Lines (DAL - option chain) stock is trading lower today along with other airlines this morning, hurt by rising oil futures. Oil futures shot up over 7% this morning in response to growing political turmoil in Libya. Libya is the largest oil producer in North Africa, and is responsible for 2% of global daily output. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on DAL.

This morning, DAL opened at $10.99. So far today the stock has hit a high of $10.99 and a low of $10.59. As of 12:35, DAL is trading at $10.65, down $0.85 (-7.3%). The chart for DAL looks bullish and S&P gives DAL a positive 4 STARS (out of 5) buy ranking.

Oil is the life blood of the world economy. The turmoil in Libya and throughout the Middle East is threatening the stability of the entire world. "Oil prices were in the danger zone and could rise further, if turmoil continued in the Middle East," Fatih Birol of the International Energy Agency said, according to Reuters. "Oil prices are a serious risk for the global economic recovery."

As of 8:30 EDT, Brent crude is trading at $106.66 per barrel, up 92 cents. West Texas Intermediate crude jumped $6.29 per barrel to $96.00. Keep in mind that while U.S. markets were closed Monday, oil traded higher across other world markets.