Multiple Hurricanes in the South Set to Disrupt Oil Markets in Canada for at Least 3 Months
Since late July, crude oil has been hovering just below $50 per barrel, however the coming months could bring a healthy rebound to both crude oil and gas prices. This uptick could stem from supply issues created by Hurricane Harvey and Irma and increased demand, fueled by OPEC’s production cuts.
Comparing Harvey to Katrina
If the destructive forces of Hurricane Katrina, which rocked the US back in 2005, can offer any insight into how long it will take refineries to recover from this recent onslaught of weather, it may take up to three months for the industry to fully adjust.
Gasoline prices in Western Canada are currently at their highest price levels since 2015, indicating that the rest of 2017 should bring a steady stream of strength for the energy sector. Will diesel fuels also see the same increase? It’s likely as diesel fuels traditionally see an increase in demand in fall, so they should keep pace with the rest of the market.
Biggest Impact on Canadian Oil Producers
The most dramatic impact could be felt with Canadian oil producers who are directly connected to the U.S Gulf Coast refining market. Companies such as TransCanada Corp. have reduced their flows of Canadian crude oil on their pipelines. This has caused a stockpiling of crude oil in the North, with a potential backup noticeable all the way to Edmonton.
The Importance of Infrastructure
The real issue caused by the recent hurricanes has to do more with infrastructure than the availability of the raw materials. Crude oil must be refined in order to be a useful energy source for businesses and consumers. The pipelines are the crucial elements that transport the resources from the location of production to the site of consumption. Without secure pipelines that are intact and operational, the supply of crude oil and its refined counterparts will quickly dry up.
Although this is an issue that is affecting the industry as a whole at the moment, it is a demonstration on the vulnerabilities surrounding equipment, especially pipelines. Pipelines are the lifelines of many of our clients in Western Canada and must be carefully monitored and cared for.
Non-Destructive Testing to Prevent Failure
A pipeline malfunction or leak could cost your business thousands of dollars within minutes. Aside from the financial costs that are associated with a infrastructure failure, these incidents are also extremely dangerous to the employees that you have working in that area. How could you avoid such a disaster? We are glad you asked! That is our speciality here at 20/20 NDT Inc. All of our testing methods are designed to ensure that your infrastructure is sound and not at risk of faltering in the near future.
Our inspection techniques provide immediate results and cause no damage to your equipment or processes. Interested? Contact our Head Office to learn more!