TODAY

TODAY   |  August 22, 2011

Gadhafi rule crumbles as rebels surge

Moammar Gadhafi’s 42-year rule over Libya is crumbling at breakneck speed as rebel fighters sweep into Tripoli. NBC’s Andrea Mitchell reports.

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CURRY: All right, Richard Engel with some important reporting from Tripoli this morning. Richard , thank you. Andrea Mitchell is NBC 's chief foreign affairs correspondent and she now joins us. Andrea , good morning.

ANDREA MITCHELL reporting: Good morning, Ann.

CURRY: You have had your eye on Libya for years. How do you see this playing out?

MITCHELL: Well, first of all, this is just the beginning, as Richard has been reporting, the excitement in the streets. The challenge still for this Transitional National Council is to create a government , to create civil order. There are still, of course, pockets, resistance to be overcome. But once they do take control and it's clear that Gadhafi era is over, they still have to create a government . And this is a tribal society. There have been factions within this Transitional National Council . The State Department and NATO have been working very closely, particularly in the last couple of weeks -- the State Department and European allies and the United Nations -- to try to get them to reach out and bring other tribes in. But it remains to be seen. This is a work in progress and there are big challenges ahead.

CURRY: Meantime, if Gadhafi is trying to run -- and that's the real question, as to whether or not he is...

MITCHELL: Right.

CURRY: ...but if he is trying to run, there are some limits on where he can go because he has -- there's an arrest warrant from the International Criminal Court charging him with crimes against humanity, right, Andrea ?

MITCHELL: Exactly. He would only want to go someplace like Russia , like perhaps Venezuela or Zimbabwe , some government that would not send him to The Hague to face charges of crimes against humanity. So that is the challenge, for him to find an exit strategy. Their best thinking, American intelligence, is that he may still be in Tripoli , but they really don't know.

CURRY: Mm-hmm. Meantime, this is already having an effect on oil prices .

MITCHELL: Indeed.

CURRY: I understand they've gone down already on the expectation of this, that the outcome of this will mean that there'll be increased oil production . Where do you see this -- how do you see this playing out, Andrea ?

MITCHELL: I think oil prices will come down, and producers are seeing on the futures market that their stock is going up precisely because the oil companies believe they will now be able to get in.

$2.30 Current Price $106.32

MITCHELL: Libyan oil is very, very valuable. It's highly grade, sweet, light crude oil . It's about a little less than two million barrels, at least, before the war. And the rebels did not attack any of the oil fields . Those are still intact. That is the future of Libya , the fact that they have that resource, they have that supply, and if they can get a government together, they can get back on line and the expectation is that this will lead to more oil. America has not been importing oil from Libya , of course, because of the sanctions, but it's a global market . So global prices will come down, and it is about 2 percent of world supply.

CURRY: Meantime, as you know, the president released a statement overnight in which he said that Libya has reached the "tipping point" and that Gadhafi , quote, "needs to relinquish power once and for all." No mincing words there at all from the president, Andrea .

MITCHELL: Clearly. And the president had a conference call with all of the top players at 9:00 last night -- I talked to someone who was on that call -- and he said that the best advice they are giving the president is that this tipping point has happened but this still is a work in progress and there is a lot of trouble that could lie ahead, potentially. They do not know if this new council will be able to hold it together.

CURRY: All right, Andrea Mitchell . Thank you so much this morning for your reporting.