Shell: Sabotage may hit oil supplies

Oil giant Shell said today it may not be able to fulfil some export contracts after Nigerian militants sabotaged a pipeline.

The announcement means less oil is likely to be exported from Africa’s biggest supplier to global markets, which could send crude prices higher.

Nigerian media reported that the pipeline normally carried about 130,000 barrels per day of crude oil from wells to export terminals.

Shell did not specify how much oil production was cut by the militant attack.

It made the announcement under a “force majeure” contract clause under which a supplier unable to meet its obligations due to forces beyond its control usually faces no legal action.

The strongest militant group, Movement for the Emancipation of the Niger Delta, said it sabotaged two pipelines early yesterday in the troubled southern oil-producing region.

The militants say their two-year campaign of attacks on the oil industry is aimed at forcing the federal government to send more resources to the southern oil area, which remains deeply poor despite the great natural bounty.

Shell, which operates in Nigeria in a joint venture with the government, is the country’s largest oil supplier. Militant attacks on Nigerian oil facilities have trimmed nearly a quarter of the country’s regular daily output, contributing to spiralling global oil prices.