Oil prices ease despite shutdown
Oil prices steadied today despite continued uncertainty over the scale of disruption caused by BP’s shutdown of a key Alaskan oilfield.
The price of a barrel of Brent crude for September delivery was 33 cents lower at 77.97 US dollars in London, while US light, sweet crude eased 27 cents to 76.71 US dollars in New York.
Prices touched new highs yesterday as BP set about closing its Prudhoe oilfield, which is responsible for up to 8% of daily US production, after discovering corrosion in some transit pipes as well as a small leak.
The shutdown added to jitters in oil markets because of the conflict in the Middle East.
The AA Motoring Trust said petrol prices averaged 98.5p a litre across the UK yesterday, compared with 98.43p on Sunday. Diesel averaged 99.7p, against 99.62p a day earlier.
A spokeswoman said the next move for forecourt prices depended on whether other oil producing areas covered the Prudhoe loss, as well as usual factors such as demand and currency rate fluctuations.
BP confirmed today it would have to replace 16 miles of pipeline at the Prudhoe Bay field, which is in the North Slope region of Alaska.
The move came after it found 16 anomalies in 12 different locations, each indicating a wall thickness loss in excess of 70%. BP does not know when production will resume at the site.
BP America chairman Bob Malone said: “We will not commit to a date. This is going to be based upon when we can safely restart some of these lines.”
The majority of the transit lines were installed in the mid-1970s and started up in 1977 when the Prudhoe Bay field opened. The entire output of the field is around 400,000 barrels a day.
Shares in BP, which runs Prudhoe as a joint venture with other leading oil firms, remained under pressure today – down by more than 1% after a 2% fall yesterday.
