Oil jumps more than $1 on US pipeline fire
Friday, 30 November 2007
SINGAPORE, Nov 29 (Reuters): Oil prices rebounded by over $1 a barrel today, after an explosion and fire at an oil terminal in Minnesota shut down most of the main pipeline that delivers Canadian crude to US Midwest refineries.
US crude rose by $1.11 to $91.73 a barrel, recouping some of the previous session's loss of $3.80, or 4 per cent.
Brent crude climbed 96 cents to $90.77 a barrel.
Enbridge Inc said it had shut down yesterday, four of its main pipelines near its Clearbrook, Minnesota, terminal that supply over 2 million barrels per day (bpd) of Canadian oil to the US Midwest due to the explosion and fire.
The company did not give further details about the total line capacity that had been shut down and said it was unable to say when the line might be able to restart, while a county official said the fire may burn for three days.
US crude stocks fell 400,000 barrels last week, less than half of what analysts had expected, as imports offset higher demand from the nation's refineries, the Energy Information Administration said.
Crude stockpiles in Cushing, Oklahoma, -- the delivery point for US crude futures-rose 600,000 barrels over the same period, the EIA said.
But traders said expectations that OPEC might increase output when it meets next week in Abu Dhabi might drive down oil prices again.
A Reuters poll of 21 banks, funds, consultants and traders showed a majority expecting OPEC to increase output by at least 500,000 barrels per day (bpd) when its ministers meet on December 5.
Top OPEC Gulf officials have expressed concern about oil's record run, but insist supplies are sufficient and do not support prices near $100.
"We observe with great concern the recent escalation of oil prices," Saudi Oil Minister Ali al-Naimi told a regional energy conference in Singapore Wednesday.
"But we believe that the world market is well supplied and petroleum inventories are comfortable," he said, blaming a weak dollar, geopolitical tensions and speculators for the rise.
US crude rose by $1.11 to $91.73 a barrel, recouping some of the previous session's loss of $3.80, or 4 per cent.
Brent crude climbed 96 cents to $90.77 a barrel.
Enbridge Inc said it had shut down yesterday, four of its main pipelines near its Clearbrook, Minnesota, terminal that supply over 2 million barrels per day (bpd) of Canadian oil to the US Midwest due to the explosion and fire.
The company did not give further details about the total line capacity that had been shut down and said it was unable to say when the line might be able to restart, while a county official said the fire may burn for three days.
US crude stocks fell 400,000 barrels last week, less than half of what analysts had expected, as imports offset higher demand from the nation's refineries, the Energy Information Administration said.
Crude stockpiles in Cushing, Oklahoma, -- the delivery point for US crude futures-rose 600,000 barrels over the same period, the EIA said.
But traders said expectations that OPEC might increase output when it meets next week in Abu Dhabi might drive down oil prices again.
A Reuters poll of 21 banks, funds, consultants and traders showed a majority expecting OPEC to increase output by at least 500,000 barrels per day (bpd) when its ministers meet on December 5.
Top OPEC Gulf officials have expressed concern about oil's record run, but insist supplies are sufficient and do not support prices near $100.
"We observe with great concern the recent escalation of oil prices," Saudi Oil Minister Ali al-Naimi told a regional energy conference in Singapore Wednesday.
"But we believe that the world market is well supplied and petroleum inventories are comfortable," he said, blaming a weak dollar, geopolitical tensions and speculators for the rise.