A system and method are provided for detecting fluid invasion of an annular space in a pipe structure. The system includes a thermal element and a temperature sensing element placed in the vicinity of each other in the annular space of the pipe structure. A thermal signal is generated by the thermal element. The temperature sensing element is connected to a monitor that monitors and processes the thermal signal. As the thermal signal changes when conducted through different types of fluids, the invasion of an annular space by seawater that normally contains oil or gas may be reliably detected.