Oil Slips Off More Than Two-Year High
By Sarah McFarlane
Oil markets eased off a 21/2-year high Wednesday after a pipeline blast in Libya disrupted supplies and caused a price spike.
Brent crude, the global oil benchmark, fell 1.1% to $65.72 a barrel on London's ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading down 0.7% at $59.58 a barrel.
Prices jumped Tuesday after an explosion on a Libyan pipeline, which is expected to reduce oil production by up to 100,000 barrels a day, the country's National Oil Co. said.
"As the pipeline exploded it may take a long time before it is operational again," said consultancy Global Risk Management in a daily note.
This is the second significant supply disruption to the global oil market in recent weeks, following the continuing outage of the Forties Pipeline System in the North Sea, which stopped the flow of 450,000 barrels a day.
The pipeline operator Ineos said Tuesday that repairs were progressing and operations should fully resume early in the New Year.
"Initial assumptions that a Forties pipeline restart would weigh on Brent proved ill-timed as a pipeline explosion in Libya, reports of gasoline shortage in Nigeria and a cold spell in parts of North America, took the market by surprise," said consultancy JBC Energy.
Nymex reformulated gasoline blendstock--the benchmark gasoline contract--fell 1.4% to $1.77 a gallon. ICE gasoil changed hands at $592.25 a metric ton, down $6.75 from the previous settlement.
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(END) Dow Jones Newswires
December 27, 2017 05:29 ET (10:29 GMT)Copyright (c) 2017 Dow Jones & Company, Inc.