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The Trans Forcados pipeline was reportedly struck by a bomb last month. According to a recent article in the Financial Times, Bombed pipeline to hit Nigeria oil output, the attack is suspected to have been carried out by militants who employed divers to the underwater pipeline. It is reportedly still unclear who was behind the attack, but the perpetrators were highly skilled.
This explosion is not an inconsequential disruption; according to oilprice.com, the Forcados terminal can export 400,000 barrels per day when operating at full capacity and the outage caused by the bombing could shut in 300,000 barrels per day.
Historically, an event like a pipeline bombing would have an almost immediate effect on commodity prices. The market would have clearly reflected the event.
However, we all know that we are living in a new era.
This time, the bombing of the Trans Forcados pipeline has had little, if any, impact on commodity prices and in fact, barely made headlines. It is clear that oilprice.com was correct that "the supply overhang has muted the impact of violence and instability."
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