Expect gas prices to jump on the West Coast, and global economics aren't at fault this time.
According to the AP, BP Exploration Alaska announced late Sunday it had begun shutting down 400,000 barrels of daily oil production at Prudhoe Bay in Alaska as a result of a corroded Alaskan pipeline owned by BP. This cuts Alaska's total crude oil production in half.
"Alaska usually supplies 800,000 barrels of oil a day to the West Coast refineries, or 30 percent of all the oil processed daily in that region, the Energy Information Agency said in its outlook — which should cause gasoline prices all over the country to rise," the article reports.
BP was already the target of a federal grand jury, the Environmental Protection Agency and congressional investigators for letting its Alaska pipeline crumble, resulting in a spill last March.
According to USAToday.com, "Even before the spill in March dumped 270,000 gallons of oil onto the Alaskan tundra, BP's maintenance of its pipelines had come into question. Company whistle-blowers reportedly raised concerns about how the company dealt with pipe corrosion as early as 2004, eventually leading to an inquiry into possible violations of the federal Clean Water Act by the Environmental Protection Agency's office in Seattle — an investigation that intensified after the March spill."
All that said, how is it that major oil companies are producing record-breaking profits, but no investments are made in maintenance that would have saved this lapse in production?
