North America’s great oil surge of 2018, amid the highest oil prices in more than three years, is threatened by pipeline gridlock from West Texas to Alberta and oil investors have yet to fully appreciate the implications, according to Energy Aspects Ltd.

North America will contribute about 1.2 million barrels a day of production growth to the world market this year, just enough to fulfill world demand, Dominic Haywood, an analyst at Energy Aspects said in an interview with Bloomberg at the Argus Canada crude summit.

But that forecast is 100,000 barrels a day lower than what was previously estimated and there are high chances that it could be reduced further, which means even higher world crude prices later in the year, he said.

“The recent run in flat prices was due to geopolitics rather than an appreciation that supply might be a little bit tighter than people previously expected,” he said.

The discount to futures of West Texas Intermediate crude at Midland, Texas, widened to as much as $8 a barrel late last month, the biggest in more than three years, as pipelines out of the Permian Basin are operating at their maximum limit.

To the north, heavy crude from the Canadian oil sands has sold at a discount to futures by as much as $30 a barrel this year as a surge of new production filled pipelines to capacity.