Wednesday, November 16, 2011

Oil over $100 dollars a barrel on New York exchange

    A Bloomberg article suggests that the rise is caused by plans by Enbridge to reverse the direction of the Seaway oil pipeline. However uncertainty about Nigerian production and other factors may also contribute to the rise.
    Enbridge has bought Conoco-Philipps share of a pipe line that runs from Cushing Oklahoma to the Gulf Coast. Reversal of the flow will allow oil from central U.S. states and Canada to flow to the Gulf Coast. Cushing Oklahoma had become a bottleneck in the system with large amounts of oil in storage. This lowered the price of oil. Now the backlog is being cleared the price of oil has increased. The decision may to some degree mitigate the effects of the delay in approval of the planned Keystone XL pipeline.
    TransCanada Corp. CEO Russ Girling said that the Keystone XL pipelines may now be able to gain State Dept. approval with six to nine months. It is now negotiating a changed route with the state of Nebraska that will not pass over the Ogalala aquifer.See this article.. However the U.S. State Dept. has claimed that studying the new routes would cause a longer delay of 12 to 18 months. The longer delay would postpone any decision until after the U.S. elections next year.
   

   



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