Its not so much about terrorism as about economics. Though the two are often linked. Instability in a significant oil exporting country like Libya pushes up the world price for oil because it causes uncertainty in stability of supply. This should be quite obvious by the spike in oil prices since the trouble in the Middle East began.
The west didnt start the trouble in Libya, but once it looked like it was going to be a protracted civil war, they had to pick a side. Gaddafi is regarded as a bit of a loose cannon (read eccentric and difficult to control) trading partner, an so the west decided it was best he be replaced. They thought that with UN Security Council resolution 1973 Gaddafi would be ousted in short time and a new government set up. Thats not the way its panning out at present however, and the prospects of a drawn out civil war are looking more likely. UN resolution 1973 isn't doing the job and so other options such as arming and funding the rebels are being considered.
The outward, (and morally indisputable) justification for UN resolution 1973 was to protect civilians, but the underlying hidden agenda was of course, regime change.
If humanitarian considerations were the primary driving force behind western military and political interference in the Middle East, USA and its western hangers on would be invading Saudi Arabia and Bahrain. But they are not, because these draconian, murderous dictatorships are relatively stable with rulers compliant to western economic needs.
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