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As it happens, over the last few years, a major event seems to rock the January energy prices and hurt consumers…
In 2009, the Russian Ukraine natural gas dispute fretted the markets, and last year the Dubai debt crisis accelerated the rise in crude. And a few weeks ago, crude prices were sliding based on negative market sentiment. There were three events that contributed to the recent rally in oil this week; the Alaska pipeline leak, Japan’s Euro support and the White House Oil Spill Report.
The Trans Alaska pipeline suddenly sprung a leak near Prudhoe Bay virtually closing the flow of 630,000 barrels/day of crude or 12% of the U.S. domestic production. It was only last May that another problem closed the pipeline, putting into question the reliability of the 33 year transportation system.
We expect his won’t be the last time our aging North American pipeline infrastructure fails contributing to price spikes.
And what about the kneejerk reaction of the “specu-investors?” How is west coast supply threatened and what’s now driving up crude?
By: Roger McKnight, Senior Petroleum Analyst
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