BP Shuts Prudhoe Bay Oil Field; 8 Percent of U.S. Output

[Proetus]

http://www.bloomberg.com/apps/news?p...7BY&refer=home
http://www.marketwatch.com/News/Stor...8F%7D&keyword=

ANCHORAGE, Alaska - In a sudden blow to the nation's oil supply, half the production on Alaska's North Slope was being shut down Sunday after BP Exploration Alaska, Inc. discovered severe corrosion in a Prudhoe Bay oil transit line.

BP officials said they didn't know how long the Prudhoe Bay field would be off line. "I don't even know how long it's going to take to shut it down," said Tom Williams, BP's senior tax and royalty counsel.

Once the field is shut down, in a process expected to take days, BP said oil production will be reduced by 400,000 barrels a day. That's close to 8 percent of U.S. oil production as of May 2006 or about 2.6 percent of U.S. supply including imports, according to data from the U.S. Energy Information Administration.

In global electronic trading, crude-oil futures for September delivery rose as much as $1.23 a barrel, to $75.99, after BP reported the shutdown. Oil reached a record $78.40 a barrel on July 14.

[goochman]

Not Cat-5 Hurricanes on the forecast so there needs to be some reason to keep gas prices high...................

[tom3]

They've had troubles with this pipeline for a while now from what I read. I guess profit margins are thinning so now's a good time to shut it down and get back to gouging the public. Oddly though, I filled up this morning and the price went down 12 cents as I pulled in. We'll see how long that lasts. $3.03 a gallon.

[Randle2I]

Premium was $3.11 this morning as I drove by. I'm thinking of filling up just because.

[racy]

At a time when GM's new truck line is key to its turnaround, we get news like this:

"Once the field is shut down, BP said oil production will be reduced by 400,000 barrels a day. That’s close to 8 percent of U.S. oil production or about 2.6 percent of U.S. supply including imports, according to data from the U.S. Energy Information Administration."

BP, which is already facing a criminal investigation over a large spill in March at the same Prudhoe Bay oilfield, said it did not know how long the field would be offline. “I don’t even know how long it’s going to take to shut it down,” said Tom Williams, BP’s senior tax and royalty counsel.

Full article here: http://www.msnbc.msn.com/id/14219844/

[rsnumber2]

Well, at least local drilliing companies will be buying plenty of trucks to keep up localized production, eh?

[MrMax]

Wow. 8% of U.S. oil production is huge. We might see $4 a gallon earlier than we thought.

[DenCo]

Wow... they sure are unlucky huh...

I'm still waititng for the day they raise gas prices because an oil company exec sneezed or something.

[CountryME]

Why is this an issue? US oil is sold to Japan because we can get more money from it than using it ourselves. While I understand it's a global economy, this shouldn't affect US gas prices.

[Ming]

3 of the gas stations on my way to work had their price signs down completely. Coincidence?

I'll need to find a good place to fuel up during lunch. Too bad I'm still with a gas-only engine for now. They're selling E-85 right down the road from where I work now, and the E-85 price is going down while gas is going up.

[freema22]

Originally Posted by CountryME

Why is this an issue? US oil is sold to Japan because we can get more money from it than using it ourselves. While I understand it's a global economy, this shouldn't affect US gas prices.

It SHOULDN'T, but we all know they will use it as an excuse to ******************** us somemore. I am all for companies making money (I work for a Fortune 100 company), but this is ridiculous! The oil companies could cut their prices in half, and still make profits that would put 95% of all companies to shame. It is not about making the share holders happy anymore, it is about greed. When an OPEC executive comes on the news and says "there is no oil shortage" and he doesn't know why the prices are doing what they are doing, who do we have left to turn to, other than the oil companies themselves.

Mike F

[61695]

Who remembers the California power crisis a few years back. Remember how that turned out to be nothing but smoke and mirrors? Bet the same fauuout will occur over gas prices just wait and see.

[logansowner]

Originally Posted by CountryME

Why is this an issue? US oil is sold to Japan because we can get more money from it than using it ourselves. While I understand it's a global economy, this shouldn't affect US gas prices.

That statement is laughable, of course it SHOULDN'T effect prices in the US, but has that EVER stopped it from doing it?

[logansowner]

Originally Posted by Ming

3 of the gas stations on my way to work had their price signs down completely. Coincidence?

I'll need to find a good place to fuel up during lunch. Too bad I'm still with a gas-only engine for now. They're selling E-85 right down the road from where I work now, and the E-85 price is going down while gas is going up.

Hey Ming, at that station, for a comparison for everyone else, could you post the price for gas vs E-85 so we can all see how much of a difference it makes in the real world of prices, not the fancy world of shoulda's and coulda's? Thanks.

[goochman]

Like I said in the other thread on this - Hurricane season has been mild and there are no Cat-5 storms on the horizon so something needed to happen to keep prices up.