Nymex crude climbs amid concerns over flood impact on Canadian oil
BY DAVID BIRD
NEW YORK -- U.S. crude oil futures prices climbed Monday on concerns that flooding in the province of Alberta, Canada's oil patch, could impact exports to the U.S.
Canadian pipeline operator Enbridge said it had shut down and isolated a pipeline north of Cheecham, Alberta, after detecting a spill of some 750 bbl of crude oil that it believed was caused by heavy rain and flooding. Enbridge said it had shut down all other Enbridge pipelines in the area.
The region around Cheecham is a major center of oil-sands production, and it wasn't immediately clear what volumes of oil have been affected by the various Enbridge pipeline shutdowns. A spokesman for Enbridge said it wasn't disclosing how much oil has been affected by the shutdowns and likely wouldn't until it had "a material effect on deliveries, if that occurs."
Canada, the U.S.'s biggest source of foreign crude, accounted for about 28% of crude oil imports in the week ended June 14. According to preliminary U.S. data, volume from Canada averaged 2.345 MMbopd, in that week.
Andy Lebow, broker and analyst at Jefferies, said it wasn't yet clear how much oil would be impacted by the pipeline issue or whether imports would be impacted.
"We don't know yet," he said. "But if they can't get oil out of Canada, they are going to get it out of Cushing," he said, referring to the key Midwest storage hub, where U.S. oil futures are priced.
Light, sweet crude oil futures for August delivery on the New York Mercantile Exchange were up 93 cents at $94.63/bbl. ICE North Sea Brent crude trimmed larger losses and traded 14 cents lower at $100.77/bbl.
Dow Jones Newswires