Oil Prices Rise After Cyberattack on US Pipeline
OREANDA-NEWS. Global oil prices are rising after a cyberattack on the Colonial Pipeline, which provides fuel to almost half of the population of the east coast of the United States.The price of July Brent crude oil futures on the London ICE Futures exchange on the morning of Monday, May 10, jumped to $68.69 per barrel — $0.41 (0.6%) higher than the price at the close of the previous session. At the end of trading on May 7, these contracts rose by $0.19 (0.3%) to $68.28 per barrel.
The price of WTI crude oil futures for June in electronic trading on the New York Mercantile Exchange (NYMEX) rose to $65.26 per barrel, which is $0.36 (0.55%) higher than the level at the close of the previous session. On May 7, the value of these contracts increased by $0.19 (0.3%) to $64.9 per barrel. At the end of last week, Brent rose by 2.3%, WTI — by 2.1%, according to the Dow Jones Market Data.
The cyberattack on the Colonial Pipeline, allegedly carried out by the hacker group «DarkSide» with roots in Russia, paralyzed this largest pipeline in the United States. It's full operation is still not restored. Hackers demand a ransom from the fuel pipeline operator, the amount of which is still unknown.
«The main question is how long the suspension will last. Obviously, the longer it lasts, the more it will contribute to the growth of prices for petroleum products», said ING analysts, who are referred to by S&P Global Platts.
The US authorities have imposed a state of emergency in the region. A few days after the cyberattack, the operator managed to restore only a few minor branches. The main fuel line is still not working.