Norway’s $1.4 trillion wealth fund…
China's rapid acceleration in clean…
The Forties oil and gas pipeline shutdown on Monday, caused energy prices in the United Kingdom to spike in the afternoon, according to a new report by Reuters. Brent Crude, which Forties carries, also spiked to a two-and-a-half-year high on news of the stoppage.
Wholesale gas prices for immediate delivery dates rose by 28 percent to the highest rate since the beginning of 2013. The jump brought domestic gas prices almost to parity with Asian LNG rates. Brent crude was trading up 1.96% on the day at $64.64.
A spokesman for Ineos, the pipeline’s holding company, said the pipeline would not be operational for “weeks rather than days.”
“It happens to come at the highest demand point of the year, with the system already notably tight,” he added. Ineos just finished buying the pipeline and the Kinneil terminal from British Petroleum just over a month ago.
The British power grid is already strained due to winter demand, five offline nuclear reactors, and outages affecting the Bacton Seal.
Last week, the Forties pipeline stream—the U.K.’s main export vein for its Scottish refineries—saw disrupted flows after officials spotted a “seepage” onshore. The spill was not severe, with just a few drops leaking from the pipeline every minute. This was no reported “contamination issue” due to its early detection during scheduled maintenance.
Related: Is Oil About To Collapse?
"Ineos has mobilized a repair and oil spill response team following the identification of a very small amount of oil seepage during a routine inspection of the Forties Pipeline System at Red Moss, near Netherley, Aberdeenshire, at approximately 10:00 hours yesterday,” an official statement said at the time.
It is unclear if the recent shutdown is related to the previous leak. The police had closed a local road and cordoned off a 300-meter area for workers to resolve the issue.
"A small number of local residents within this area have been advised to temporarily relocate," the company added. "We will work to resolve the issue and monitor the situation. We apologize for any inconvenience caused."
By Zainab Calcuttawala for Oilprice.com
More Top Reads From Oilprice.com:
Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…