A rupture in the nearly 2,700-mile Keystone oil pipeline in North Dakota has shut down the flow of millions of gallons of crude oil, potentially leading to higher gasoline prices in the Midwest. The pipeline, which transports an average of 26 million gallons per day, was shut down after control center leak detection systems detected a pressure drop in the system.
The company managing the pipeline, South Bow, said it estimated that 3,500 barrels of oil were released from the spill, which is confined to an agricultural field. The company’s primary focus is on the safety of onsite personnel and mitigating risk to the environment.
Experts warn that prices at the gas pump could rise in the coming days, with a greater impact on diesel and jet fuel. Ramanan Krishnamoorti, vice president for energy and innovation at the University of Houston, said the pipeline’s shutdown could lead to higher prices within one or two days.
The Keystone pipeline transports a unique, heavy crude that is only available from limited sources. Without this supply, refineries may struggle to produce diesel and jet fuel, leading to potential price increases.
While some experts predict immediate price spikes, others argue that major refineries have enough stored crude oil to insulate them from the impact. However, if the shutdown continues for more than a few days or a week, it could become problematic.
The Pipeline and Hazardous Materials Safety Administration (PHMSA) is investigating the cause of the rupture, which was reported to have occurred within two minutes of a “mechanical bang.” The agency has faced criticism for being under-resourced and underfunded in recent years.
Source: https://apnews.com/article/keystone-oil-pipeline-north-dakota-spill-36e86142566763a5464e1dd132eede56