Oil Surges After Enbridge Pipeline Explosion Cuts U.S. Supplies: “Oil surged more than $4 a barrel, the most in a month, after an explosion cut Canadian oil shipments through Enbridge Inc. pipelines that typically provide about 15 percent of U.S. crude imports.
Enbridge closed four pipelines that supply an average of 1.5 million barrels a day after a blast yesterday killed two workers. The company said today a fire is still burning at the Clearbrook terminal in Minnesota where the pipelines meet.
“It's an important pipeline and it's also where it's being hit, these pipeline junctions are a nightmare,'' said Rob Laughlin, a senior broker at MF Global Ltd. in London. Oil “could go up further if it's shut for some time.””
As of 7:00 AM this morning, two of the four lines have been re-opened. Crude has given back some of the gains.
““All our lines are shut down until we can safely start up the system,” Denise Hamsher, a spokeswoman for Calgary-based Enbridge, said today by telephone. “At least one or two lines will be shut down for quite sometime.”
The leak and explosion occurred at the No. 3 pipeline, which was undergoing maintenance, according to Enbridge.
U.S. refineries operated at 89.4 percent of capacity, the highest since the week ended Sept. 14, the energy department said. Refiners usually start in November units that were shut during the previous two months for repairs after the summer driving season ends and before demand for heating oil picks up.
OPEC has no plan to raise oil output when it meets next week in Abu Dhabi because the market is well supplied, Qatar's oil minister said yesterday.”
There isn’t much slack in the system here. With pipeline troubles, even an OPEC production hike wouldn’t matter in the least.
Thursday, November 29, 2007
Oil Surges After Pipeline Explosion
Posted by Ben Bittrolff at 7:22 AM
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