Brent crude jumps above $65 for first time since 2015 after North Sea pipeline outage

  12 December 2017    Read: 656
Brent crude jumps above $65 for first time since 2015 after North Sea pipeline outage
Brent crude oil prices jumped above $65 per barrel for the first time since 2015 after the shutdown of the Forties North Sea pipeline knocked out significant supplies from a market that was already tightening due to OPEC-led production cuts, Reuters reported.
Brent crude futures LCOc1, the international benchmark for oil prices, were at $65.07 a barrel at 0211 GMT, up 37 cents, or 0.6 percent from their last close.

It was the first time Brent rose above $65 since June 2015.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $58.21 a barrel, up 22 cents, or 0.4 percent from their last settlement.

“Brent crude raced higher...as news broke that the North Sea’s Forties Pipeline system would have to be shut down for a ‘number of weeks’ after a hairline crack was found in it,” said Jeffrey Halley, senior market analyst at futures brokerage OANDA in Singapore. “The pipeline...is a significant component underpinning the Brent benchmark.”

Britain’s Forties oil pipeline, the country’s largest at a capacity of 450,000 barrels per day (bpd), shut down on Monday after cracks were revealed.

“The market reaction shows that in a tight market, any supply issue will quickly be reflected in higher prices,” said ANZ bank.

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