Keystone Pipeline’s owner, South Bow Corp., has declared force majeure on scheduled crude oil shipments following a spill that released approximately 3,500 barrels of oil into a North Dakota field. The disruption threatens to ripple across fuel markets, particularly in the Midwest. According to a notice, the company informed customers that it might be unable to fulfill its delivery obligations dating back to 5 p.m. local time on Tuesday. Excavation efforts to pinpoint the leak were expected to begin as early as Wednesday evening.
Midwestern fuel markets may feel the brunt of the disruption, according to analysts. The region’s gasoline inventories have fallen for four straight weeks, reaching their lowest levels since late January. Diesel supplies have been sliding for six weeks and are now at their lowest since December, per new data from the U.S. Energy Information Administration.
Bottom line: A prolonged shutdown could heighten upward pressure on retail gasoline and diesel prices in the Midwest, where refineries rely heavily on Canadian crude.
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