• 4 minutes Tariffs to derail $83.7 Billion Chinese Investment in West Virginia
  • 9 minutes Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 17 minutes Kaplan Says Rising Oil Prices Won't Hurt US Economy
  • 21 mins Saudi Arabia plans to physically cut off Qatar by moat, nuclear waste and military base
  • 8 hours Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 46 mins Could Venezuela become a net oil importer?
  • 24 hours Corruption On The Top: Netanyahu's Wife Charged With Misuse of Public Funds for Meals
  • 10 hours Why is permian oil "locked in" when refineries abound?
  • 3 hours Saudi Arabia turns to solar
  • 1 min Reuters: OPEC Ministers Agree In Principle On 1 Million Barrels Per Day Nominal Output Increase
  • 12 hours Teapots Cut U.S. Oil Shipments
  • 12 hours Oil prices going down
  • 35 mins China’s Plastic Waste Ban Will Leave 111 Million Tons of Trash With Nowhere To Go
  • 17 hours Russia's Energy Minister says Oil Prices Balanced at $75, so Wants to Increase OPEC + Russia Oil by 1.5 mbpd
  • 13 hours Hot line, Macron: Phone Calls With Trump Are Like Sausages Best Not To Know What Is Inside
  • 1 day U.S. Withdraws From U.N. Human Rights Council
  • 2 hours EVs Could Help Coal Demand
  • 23 hours EU Confirms Trade Retaliation Measures vs. U.S. To Take Effect on June 22
  • 13 hours Putin Says 'Fierce' U.S. Politics Hindering Summit With Trump
Alt Text

Canada Bets On Trans Mountain Expansion To Sell Oil In Asia

Due to congested takeaway capacity…

Alt Text

Is This The Most Contentious OPEC Meeting Yet?

OPEC’s members have been divided…

Daniel J. Graeber

Daniel J. Graeber

Daniel Graeber is a writer and political analyst based in Michigan. His work on matters related to the geopolitical aspects of the global energy sector,…

More Info

Trending Discussions

Gulf Coast Oil Stockpiles Hit Record Levels

Gulf Coast Oil Stockpiles Hit Record Levels

Crude oil stockpiles in the United States are at record levels and, with no place to go, oil inventories may continue to build because of the accelerating rate of production from shale operations.

The U.S. Energy Information Administration said April 23 that crude oil stockpiles along the Gulf Coast in an area known as Petroleum Administration for Defense District 3 (PADD 3) have reached more than 209 million barrels, the highest level since 1990.

Inventories at the storage hub in Cushing, Oklahoma, meanwhile, are at their lowest levels since 2009, at 26 million barrels.

More oil is flowing to PADD 3 because of expanding infrastructure in the region.

A few years ago, the Cushing hub was awash in oil that had few options for delivery to Gulf Coast refineries. In January, TransCanada opened the Gulf Coast project, a 487-mile pipeline from Cushing. It will deliver 520,000 barrels of oil per day (bpd) in its first year in service and eventually deliver 830,000 bpd.

The Seaway pipeline, a 50-50 joint venture between Enterprise Products Partners and operator Enbridge, was reversed in 2012 and now sends around 400,000 bpd out of Cushing.

Oil production in the United States, meanwhile, continues to gain steam and stood at 8.36 million bpd for the week ending April 18.

Imports from members of the Organization of Petroleum Exporting Countries continue to decline. Saudi Arabia delivered 1.3 million barrels to the U.S. market for the week ending April 18, though that level was down more than 500,000 barrels from the previous week.

Related Article: North American Oil Glut to Keep Prices Low, IMF says

Legislation enacted in response to the Arab oil embargo in the 1970s restricts crude oil exports, so most of the oil at PADD 3 now may accumulate. Most refiners prefer to process a heavier grade of crude than what's produced in the United States, so the U.S. market isn't necessarily breaking free from imports. Crude oil imports into PADD 3 increased to 4.59 million bpd, an 11 percent increase from March 14.

An increase in crude oil deliveries by rail may spread deliveries elsewhere in the U.S. market, however. More than 400,000 carloads of crude left the Bakken play in North Dakota last year, up from the 9,500 carloads reported in 2008. That means some oil can get to East Coast refineries that would otherwise depend on imports.

The glut of U.S. crude is keeping the price for West Texas Intermediate low, while Brent prices feel pressure from international issues in Ukraine.
That, in theory, should keep prices for oil products, including gasoline, lower in the United States, although low U.S. demand means more products are headed overseas.

While production is up, the U.S. market isn't yet feeling the benefit from the easing of the Cushing bottleneck. If the Obama administration eventually approves Keystone XL, that trend could continue.

By Daniel J. Graeber




Back to homepage

Trending Discussions


Leave a comment
  • Stephanie on April 27 2014 said:
    If there is so much extra oil, try to explain why the prices keep going higher and higher?
  • nemteck on April 28 2014 said:
    Quote: "The glut of U.S. crude is keeping the price for West Texas Intermediate low". Dummes Geschwätz. The yearly average of WTI rose year over years since 2008 and now is over $100. That's low?

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News