There is a huge role that pipelines play in any civilization, in the country or anywhere in the world for that matter. Today well want to look at the importance and the challenges that pipeline infrastructure faces in any economy.
Attacks on Pipelines
Many people who are far flung from oil countries don’t know about this, but there are attacks on pipelines globally. These attacks can stem from any reason right from people objected to the pipeline. When this happens, the oil comes from the pipes and spills out to the surface. This oil contains hydro-sulfuric acid which goes ahead to corrode everything in its wake.
Breaks in the pipeline can also occur due to corrosion. This can happen due to overlying soil that is poorly packed. Due to the high pressure in the pipe, it can burst to lead to oil spillage. Any spillage gets the environmentalists into a frenzy, and it all turns into an unmanageable situation.
The Effect of Breaks
Pipeline breaks due to attacks or corrosion lead to shut down of flow of oil. This, in turn, affects the price of oil because the commodities market takes advantage of this and plays off the chaos that is caused by supply. When demand is high, and the supply is low, there is a good excuse for the prices to shoot. The irony is that it doesn’t matter where in the world this pipe breaks, the results are the same.
Yes, we also have thieves who focus on stealing oil from the pipelines. These thieves use drills to cut through the pipe and siphon off oil. This, in turn, causes spills in the wetlands and losses amounting to millions of dollars in repairs.
One of the results of this practice is pipeline explosions. These thieves don’t know how to handle the flammable oil and in most cases blow up the pipe. Economic terrorism is also real, where a country blows up a pipeline in another country to sabotage their economy. These explosions lead to a pause in the flow, which in turn leads to a rise in the price of oil per barrel.
So, what we have is a case of old pipelines that have been corroding gradually over the past few years, economic terrorism, theft and some security threats. What happens affects the whole world, because no matter where the issue happens, the price of oil will rise.