A buried section of the Trans-Alaska Pipeline emerges a few miles north of the Yukon River.
A buried section of the Trans-Alaska Pipeline emerges a few miles north of the Yukon River. - 
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STEVE CHIOTAKIS: The oil market today braced for a big surge in prices following a pipeline leak that was discovered Saturday in Alaska. A leak that shutdown all production in North America's biggest oil field. But the price of oil today was up only modestly.

Marketplace's Stephen Beard is with us now from London. Hi Stephen.


CHIOTAKIS: What happened in Alaska?

BEARD: A leak was discovered in a pumping station on the Trans Alaska Pipeline. This is the only pipeline that carries oil from Prudhoe Bay down to the Port of Valdez, 800 miles away. From there of course it's shipped out by tankers. This is not a huge leak, only ten barrels of oil apparently leaked into the pumping station, but this is a 640,000 barrel a day pipeline, and much of that flow has now been halted while BP and other companies investigate the leak.

CHIOTAKIS: Has the shutdown interrupted supply to the market? Will we see higher prices because of this?

BEARD: Not yet. There are about 2.5 million barrels in storage in Valdez so the ships are still able to come in and fill up and keep the market supplied. But that 2.5 million barrels will keep the ships busy for only about four days if the pipeline is shut for longer than that, then we could all be paying much more for our gasoline. Here's oil analyst Nick McGregor of Brokers Redmayne Bentley.

NICK MCGREGOR: If this requires a prolonged shut down of the pipeline, which carries about 15 percent of U.S. oil production, then it could have an impact on prices globally as people look to buy elsewhere to take up the slack.

Some analysts are saying that if the pipeline shut down lasts very much longer than a week, the oil price could rocket to well over $100 a barrel.

CHIOTAKIS: Marketplace's Stephen Beard with us from London. Stephen, thanks.

BEARD: OK Steve.