WTI oil trading near $89 as new oil leak spooks market

10 January 2011 10 January 2011

BonTrade

WTI oil prices opened today’s trading session in positive territory, near $89 a barrel as news of a crude oil leak in Alaska spooks the market, with traders and investors jumping into push oil prices higher.

Latest WTI Oil Price

US Light crude oil futures for February 2011 delivery was trading at $88.83 a barrel, 07.45 GMT this mrning on the NYMEX, after opening near $90, two dollars higher than Friday’s closing price of $88.03.

Crude oil traders said that if the outage lasted longer than a week or two, it has the potential to be very bullish. One noted that most of the pipeline’s problems had been fixed quickly, but in the post Deepwater Horizon world, approvals to restart after accidents could take longer.

“Events like this carry risks around future regulation that could dramatically reduce crude oil supply on a more permanent basis than this temporary outage. There is a possibility the risk is pretty substantial for the oil futures market.” said Ben Westmore, commodities analyst at National Australia Bank.

Fire at Oil Sands Adds to Problems

Meanwhile, late last week, a fire halted production at Canadian Natural Resources main oil sands project in northern Alberta. The company could not say when its 110,000 barrel a day Horizon facility would resume normal operations, though it expects to have a repair schedule ready at some point this week.