LONDON – Oil surged more than US$3 a barrel yesterday after an explosion on a major pipeline cut crude oil imports to top consumer the United States by nearly a fifth.
US crude jumped US$3,25 to US$93,87 a barrel by 1009 GMT, off a session high of US$95,17. Brent crude leapt US$1,93 to US$91,74 a barrel.An explosion hit a main pipeline that supplies Canadian crude to US Midwest refineries on Wednesday, forcing operator Enbridge Inc to shut down four of its main pipelines.The pipelines carry an estimated 1,9 million barrels per day (bpd) of Canadian crude to the United States, a fifth of US imports.”This is a fast reaction to the accident, and it will be good news for bull players,” said Tetsu Emori of Astmax Futures.”Oil prices may rise further if the accident is proven as a big supply disruption.”One of the set of four pipelines will require repairs and regulator inspections, while the largest is “not likely” to start up soon, an Enbridge spokesman said.The incident more than offset the impact of a smaller-than-expected drop in US crude and distillate stocks, that had eased supply concerns and pushed prices into the biggest decline since August 6.But traders said expectations the Organisation of the Petroleum Exporting Countries might increase output when it meets on December 5 in Abu Dhabi might drive down prices.Top Opec Gulf officials have expressed concern about oil’s record run, but insist supplies are sufficient and do not support prices near US$100.Nampa-ReutersBrent crude leapt US$1,93 to US$91,74 a barrel.An explosion hit a main pipeline that supplies Canadian crude to US Midwest refineries on Wednesday, forcing operator Enbridge Inc to shut down four of its main pipelines.The pipelines carry an estimated 1,9 million barrels per day (bpd) of Canadian crude to the United States, a fifth of US imports.”This is a fast reaction to the accident, and it will be good news for bull players,” said Tetsu Emori of Astmax Futures.”Oil prices may rise further if the accident is proven as a big supply disruption.”One of the set of four pipelines will require repairs and regulator inspections, while the largest is “not likely” to start up soon, an Enbridge spokesman said.The incident more than offset the impact of a smaller-than-expected drop in US crude and distillate stocks, that had eased supply concerns and pushed prices into the biggest decline since August 6.But traders said expectations the Organisation of the Petroleum Exporting Countries might increase output when it meets on December 5 in Abu Dhabi might drive down prices.Top Opec Gulf officials have expressed concern about oil’s record run, but insist supplies are sufficient and do not support prices near US$100.Nampa-Reuters
