Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Crucial Iraq-Turkey oil pipeline knocked out by explosion sending oil prices higher

© Bloombergoil opec+
Oil pipes run into the ground at the Enbridge Inc. Cushing storage terminal in Cushing, Oklahoma, U.S., on Wednesday, March 25, 2015. Photographer: Daniel Acker/Bloomberg

A key crude pipeline from Iraq to a Turkish port on the Mediterranean Sea was knocked out by an explosion on Tuesday, adding pressure to already tight oil markets and sending prices higher with oil extended gains in Asia from the highest close since 2014.

Pipeline operator Botas said the fire has been extinguished, cooling operations are under way and it would reopen once the “necessary measures” had been taken. The cause of the explosion was unknown. It’s a key route bringing oil from northern Iraq to Europe via the port of Ceyhan, and the blast is the latest incident in a series of disruptions the market has suffered in recent months.

Oil prices extended gains in Asia on the news after closing at a seven-year high. Global crude inventories are already near the lowest level since October 2019 with the omicron virus variant not having much of a demand impact and supply problems in Libya and Kazakhstan. Goldman Sachs Group Inc. has predicted Brent will hit $100 a barrel in the third quarter.

The explosion hit in the Turkish province of Kahramanmaras, at kilometer 511 of the route to Ceyhan, Botas said. While it’s not clear how quickly the facility can be brought back, the loss is a major blow: The pipeline moved more than 450,000 barrels a day last year.

The conduit consists of two pipes running side by side, with the crude then loaded onto tankers and shipped mostly to European refineries. The oil is a mix of barrels exported on behalf of the central government in Baghdad and the Kurdish Regional Government, which controls the northeast of the country.

The pipelines have been halted before. Back in 2012 blasts blamed on saboteurs halted the link for several months.

West Texas Intermediate for February delivery rose 1.8% to $86.98 a barrel on the New York Mercantile Exchange at 9:28 a.m. in Singapore after advancing 1.9% on Tuesday.

Brent for March settlement gained 1.6% to $88.89 a barrel on the ICE Futures Europe exchange after closing at the highest level since 2014 on Tuesday.

The prompt timespread for Brent was 77 cents a barrel in backwardation, compared with 69 cents a week earlier.

Recommended for you

More from Energy Voice

Latest Posts