Oil hovers above $77 amid US pipeline leaks

SINGAPORE — Oil prices hovered above $77 a barrel Tuesday in Asia as a couple of US pipeline leaks disrupted supplies. Benchmark crude for October delivery was up 4 cents to $77.23 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract added 74 cents to settle at $77.19 on Monday. Repair crews found the source of the leak of a 670,000-barrel-per-day pipeline that carries crude from Canada to the upper Midwest, but line owner Enbridge Energy Partners said it didn't know when oil would begin flowing again. The supply disruption caused a sharp spike in gas prices across that region. Enbridge also shut down a 70,000-barrel-a-day line from Westover, Ontario to New York when about a gallon of a petroleum-based product was discovered during a sewer installation project. Repair crews were working to find the source of the leak, and the company said Monday it did not know how long that line would be shut down. Oil has traded in the $70s for most of the last year as the global economy recovers from last year's recession. Some analysts expect strong crude demand in emerging economies such as China will offset sluggish consumption in developed countries and begin to make a dent in record US supplies. "The tide will soon be turning in the US oil market," Goldman Sachs said in a report. "We expect a draw on US inventories to begin in the coming weeks, which will likely serve as a catalyst for higher crude oil prices." Goldman said it expects crude to trade at $92 a barrel in three months, $91 in six months and $101 in a year. In other Nymex trading in October contracts, heating oil was up 0.30 cent at $2.1257 a gallon and gasoline added 0.42 cents to $1.9848 a gallon. Natural gas advanced 1.2 cents to $3.950 per 1,000 cubic feet. In London, Brent crude rose 17 cents to $79.20 a barrel on the ICE Futures exchange. — AP