• 6 minutes WTI @ 67.50, charts show $62.50 next
  • 11 minutes Saudi Fund Wants to Take Tesla Private?
  • 17 minutes Starvation, horror in Venezuela
  • 1 hour Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 2 hours The EU Loses The Principles On Which It Was Built
  • 37 mins Crude Price going to $62.50
  • 6 hours Anyone Worried About the Lira Dragging EVERYTHING Else Down?
  • 10 hours Oil prices---Tug of War: Sanctions vs. Trade War
  • 11 hours Correlation does not equal causation, but they do tend to tango on occasion
  • 11 hours Russia retaliate: Our Response to U.S. Sanctions Will Be Precise And Painful
  • 6 hours Why hydrogen economics is does not work
  • 13 hours Monsanto hit by $289 Million for cancerous weedkiller
  • 19 hours WTI @ 69.33 headed for $70s - $80s end of August
  • 19 hours WSJ *still* refuses to acknowledge U.S. Shale Oil industry's horrible economics and debts
  • 17 hours Saudi Aramco IPO Seems Unlikely
  • 3 hours < sigh > $90 Oil Is A Very Real Possibility
IEA: The World Needs More Diverse Cobalt Sources

IEA: The World Needs More Diverse Cobalt Sources

The International Energy Agency reported…

The Oil Bulls Are Back

The Oil Bulls Are Back

Oil markets had a bullish…

Cushing Pipeline Suspension Gets Extended

Roughnecks at work

Plains All American Pipeline, the operator of the biggest pipeline carrying crude from the Permian to Cushing, Oklahoma, said it has extended the suspension of the pipeline due to problems with pressure. The announcement was made on Thursday, the day when the pipeline was to be restarted after a 10-day stoppage for a hydrotest.

The news immediately affected the spread before the front-month futures contract for West Texas Intermediate, and the second-month contract, Reuters noted, with traders largely expecting the planned outage to cause a shortage of 2 million barrels at Cushing for last week. As a result, the front-month WTI contract’s discount to the second-month futures narrowed by 10 cents to just US$0.33. Spot prices for WTI were also affected, with the discount to the futures contract diving to US$1 a barrel from US$0.15 in the same session, before the pipeline operator made its announcement.

The November contract for WTI closed at US$50.77 a barrel on Thursday, up 0.56 percent. The spot price for the benchmark at Cushing was US$50.72 on Tuesday, the latest available figure from the EIA.

The Permian pipeline is the only outgoing one in the most productive shale play in the U.S. It has a daily capacity of 450,000 barrels of crude, and if Plans All American Pipeline does not complete the work on it until next Thursday, storage facilities along and around it could fill up. This would push spot prices further down, according to traders.

Plains All American Pipeline operates over 18,000 miles of crude oil and natural gas liquids pipelines and gathering systems and has a total storage capacity of 30 million barrels.

Earlier this week, analysts cautioned that the company faces heightened risk to its revenues from its supply and logistics operations, which contribute a fifth of overall revenues. According to the experts, this business division gets its income from the difference in purchase and resell prices of crude oil and natural gas liquids. This makes it vulnerable to fluctuations in regional supply and demand for these commodities.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

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