Blast hits Libyan crude pipeline, cutting output by 90,000 bpd

BENGHAZI: Armed men blew up a Libyan pipeline pumping crude oil to Es Sider port on Tuesday, reducing the North African country’s output by around 90,000 barrels a day, military and oil sources said.
The attackers arrived at the site near Marada in two cars and planted explosives on the pipeline, a military source said.
Pictures purportedly showing a huge cloud from the blast in central eastern Libya circulated on social media.
The damage was still being assessed, one oil source said. Oil prices rose on the report.
Islamic State fighters had a presence in the area until government forces expelled them from their main stronghold in Sirte a year ago.
The operator of the pipeline is Waha, a subsidiary of Libya’s National Oil Corporation and a joint venture with Hess Corp, Marathon Oil Corp. and ConocoPhillips.
Waha pumps a total 260,000 barrels a day, its chairman said last month.
Libya’s oil production was last put by officials at around one million bpd but exact figures are hard to obtain a country riven by factional conflict.
Meanwhile, oil moved higher above $65 a barrel on Tuesday, within sight of its highest since mid-2015, supported by the pipeline explosion and voluntary OPEC-led supply cuts.
The move toward restart of a key North Sea pipeline, Forties, capped the rally. The pipeline is being tested after repairs and full flows should resume in early January, its operator said on Monday.
Brent crude, the international benchmark for oil prices, rose 19 cents to $65.44 a barrel at 1447 GMT. Prices hit $65.83 on Dec. 12, the highest since June 2015. US crude added 24 cents to $58.71.
“The confirmation that Forties is coming back ....has the potential for capping Brent,” said Olivier Jakob, analyst at Petromatrix.
Trading activity was thin due to the Christmas holiday in many countries.
Brent has risen 17 percent in 2017. The Organization of the Petroleum Exporting Countries, plus Russia and other non-members, have been withholding output since Jan. 1 to get rid of a glut.
The producers have extended the supply cut agreement to cover all of 2018.
Iraq’s oil minister said on Monday there would be a balance between supply and demand by the first quarter, leading to a boost in prices. Global oil inventories have decreased to an acceptable level, he added.
That is earlier than predicted in OPEC’s latest official forecast, which calls for a balanced market by late 2018.
While the OPEC action has lent support to prices all year, the unplanned shutdown of the Forties pipeline on Dec. 11 pushed Brent to its mid-2015 high.
Forties plays an important role in the global market as it is the biggest of the five North Sea crude streams underpinning Brent, the benchmark for oil trading in Europe, the Middle East, Africa and Asia.
Rising production in the United States is offsetting some of the OPEC-led cuts.
The US rig count , an early indicator of future output, held at 747 in the week to Dec. 22, according to the latest weekly report by Baker Hughes.

Blast hits Libyan crude pipeline, cutting output by 90,000 bpd