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Crude prices up on Keystone delay

Oct. 22, 2012 at 10:04 AM   |   Comments

NEW YORK, Oct. 22 (UPI) -- Oil prices on the New York Mercantile Exchange were expected to climb on word TransCanada could delay the restart of the Keystone pipeline, an analyst said.

Last week, the U.S. Pipeline and Hazardous Materials Safety Administration said it was notified by pipeline company TransCanada that the Keystone oil pipeline was closed for repairs following the identification of possible safety issues. No leaks were reported.

The Keystone oil pipeline runs 2,100 miles from oil fields in Alberta province to refineries in Illinois and Oklahoma. The pipeline transports about 500,000 barrels of so-called tar sands oil per day.

The company had said it would restart the pipeline by Friday but has since delayed the resumption until at least Monday, reports Bloomberg News. The news service notes that crude oil prices in the New York Mercantile Exchange hit a two-week low last week but should recover modestly on the Keystone delay.

NYMEX crude oil futures were up 0.62 percent early Monday to $90.61 per barrel, Bloomberg reported.

"I would expect a small rebound after heavy losses on Friday, given continued supply risks," Carsten Fritsch, an analyst at Commerzbank in Germany, was quoted as saying.

The PHMSA said the issues on the Keystone pipeline were discovered on a section extending between Missouri and Illinois. An inspector was dispatched "immediately" to observe repairs.

Public statements from the PHMSA and TransCanada weren't released Monday.

© 2012 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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