Prepare for a hike in fuel prices
Posted: Wed Jan 16, 2013 10:00 am
A leak in a North Sea pumping station shouldn't lead to a rise in fuel prices, but you can bet your ass it will.
The leak at Cormorant will affect 27 oil fields in the North Sea (8%) of the UK's total output. But in reality it's a tiny drop in the ocean.
Also our oil is apparently too rich for general fuel use, it's of such high quality that most of it is sold to other countries for processing.
This oil is called Brent Crude, and our output is 90,000 barrels per day.
An oil specialist is quoted as saying:
The leak at Cormorant will affect 27 oil fields in the North Sea (8%) of the UK's total output. But in reality it's a tiny drop in the ocean.
Also our oil is apparently too rich for general fuel use, it's of such high quality that most of it is sold to other countries for processing.
This oil is called Brent Crude, and our output is 90,000 barrels per day.
An oil specialist is quoted as saying:
So that'll be another 25% increase in domestic fuel bills and at least 20p a litre at the pumps.It is not yet known what potential impact the shut down could have on petrol station prices.
However Prof Alex Kemp, an oil economist at the University of Aberdeen, said the closure would have a limited impact on oil prices.
He told BBC Radio Scotland's Good Morning Scotland programme: "What we have is an incident which impacts on the Brent pricing system which is used as a marker price for a lot of the world's production.
"If it continues one would expect a limited affect on the Brent price.
"But the Brent price doesn't just depend on Brent production, it depends on production from a lot of other fields.
"The effect should be limited because although the Brent price is the marker for a huge volume of oil in the world market, Brent production constitutes not all that big a proportion of the total."