Oil jumps more than $1 - Oil pipeline fire kills 2 in Minn.

SINGAPORE (Reuters) - Oil surged by over $1 a barrel to above $92 on
Thursday, after an explosion and fire at a terminal in Minnesota shut
down most of the main pipeline that delivers Canadian crude to U.S.
Midwest refineries.

U.S. crude (CLc1: Quote, Profile, Research) rose by $1.65 to $92.27 a barrel by 1:38 a.m. EST, recouping some of the previous session's loss of $3.80, or 4 percent.

Brent crude (LCOc1: Quote, Profile, Research) climbed $1.31 to $91.12 a barrel.

Enbridge Inc (ENB.TO: Quote, Profile, Research)
said it had shut down on Wednesday, four of its main pipelines near its
Clearbrook, Minnesota, terminal, which carry an estimated 1.9 million
barrels per day (bpd) of Canadian crude to the United States, halting
nearly a fifth of U.S. imports.

Enbridge did not give further details about the total line capacity
that had been shut down and said it was unable to say when the line
might be restarted. A county official said the fire may burn for three
days.

"This is a fast reaction to the accident, and it will be good news
for bull players," said Tetsu Emori, fund manager at Astmax Futures Co.

"Oil prices may rise further if the accident is proven as a big supply disruption."

The incident partially offset the impact of a smaller-than-expected
drop in U.S. crude and distillate stocks, which had eased concern about
supply in the world's largest consumer and pushed prices into the
biggest decline since August 6.  Continued...

CLEARBROOK, Minn. - A fire erupted at a pipeline carrying crude oil from Canada to the Midwest on Wednesday, killing two workers who were repairing it, authorities said.

The workers were fixing the underground pipeline when fumes apparently escaped and ignited the blaze, said Kristine Chapin, a spokeswoman for the state Department of Public Safety.

No other injuries were reported. The Clearwater County Sheriff's Department said it expected the fire to continue through the night before burning itself out.

The fire along the Enbridge Energy pipeline in northern Minnesota was reported shortly before 4 p.m., the Sheriff's Department said. The oil that spilled was expected to burn and not pose any major problems.

The 34-inch pipeline carries crude oil from Saskatchewan to the Chicago area, Chapin said. The pipe had leaked a few weeks ago and was being repaired, she said.

"It appears as though one of those fittings may have failed and caused fumes to leak, and it caught fire," Chapin said. She said there wasn't an explosion and described it as a "big fire."

Nearby residents were evacuated because of the thick black smoke in the sparsely populated area.

Denise Hamsher, a spokeswoman for Houston-based Enbridge Energy, confirmed late Wednesday that the workers who died were employed by the company. Their names were not immediately released.

The pipeline that leaked and four others were shut down, though it wasn't clear for how long, Hamsher said. Because oil is stored in company stations along the line and at refineries, the pipelines could be shuttered for several days without causing disruptions in oil supplies to the Midwest, she said.

"Right now, we are securing the site and making sure that we are dealing with our employees and doing whatever we can to offer the families (of the victims) whatever assistance they need," Hamsher said. "Tomorrow we'll have a better idea of the duration and timing of the repairs."

The crude oil is used to make several kinds of fuel, such as gasoline and heating oil for homes.

Clearbrook is about 215 miles northwest of Minneapolis.