• 3 minutes In a Nutshell...
  • 5 minutes CV19: New York 21% infection rate + 40% Existing T-Cell immunity = 61% = Herd Immunity ?
  • 7 minutes Australian renewables zone attracts 27 GW of solar, wind, battery proposals
  • 9 minutes Why Oil could hit $100
  • 25 mins COVID is real now
  • 3 hours The Quad naval alliance forming.
  • 15 hours The Grey Lady has fallen (further into irrelevancy)
  • 2 days Where is Alberta, Canada headed?
  • 23 hours Is The Three Gorges Dam on the Brink of Collapse?
  • 15 hours During March, April, May the states with the highest infections/deaths were NY, NJ, Ma. . . . . Today (June) the three have the best numbers. How ? Herd immunity ?
  • 17 hours The Boris Yeltsin of America
  • 1 day Is the oil & gas industry on the way out?
  • 2 days Joe Biden offers advice to correct the public health
  • 26 mins Is Biden the poster child for White Privilege ? DNC needs to replace him now before it's too late.
  • 2 days There Has Been No Trump Manufacturing Boom Even Before Covid
  • 2 days Fauci: "USA will soon have 100K new cases per day". Trump re(p)-lies: "The problem has been fixed"
Libya Declares Force Majeure On Oil Exports Again

Libya Declares Force Majeure On Oil Exports Again

Just two days after it lifted the…

Iran’s Oil Storage Ready To Burst

Iran’s Oil Storage Ready To Burst

The amount of oil that…

Permian Oil Glut Sees Producers Lose Out on $1.2 Billion Profit

A huge increase in shale oil production from the Permian basin in Western Texas, coupled with a lack of pipelines in the area, has led to a bottleneck of crude oil, forcing prices down.

According to the US EIA, production in the 75,000 square mile Permian basin increased to 1.29 million barrels a day in 2007 and could grow further to 2.3 million barrels a day by 2022. This vast output far exceeds local pipeline capacity which has caused oil prices in the region to fall by an average of $9.82 a barrel in November alone, and robbed oil producers of a potential $1.2 billion in profit a year.

Similar stories can been seen in the Bakken Shale in North Dakota as well as around Oklahoma’s Midwestern pipeline hub, which is unable to cope with the increased supply from shale formations and Canada’s oil sands.

Related Article: Mexico to Privatize State Oil Company Pemex?

Michael McMahon, the managing director of Pine Brook, a private equity firm, explained that “Permian oil is actually very high-quality and should be selling at a premium, if it weren’t for the logistical challenges.”

James West, an analyst at Barclays Plc, has warned that the lack of pipelines will choke any growth in crude production in 2013, suggesting that capital expenditure will likely increase by just one percent compared to this year; that’s after a 20 percent rise in 2010, a 31 percent rise in 2011, a 9 percent rise in 2012. “This is putting a pause on what should be continued spending growth in North America.”

By. James Burgess of Oilprice.com



Join the discussion | Back to homepage



Leave a comment

Leave a comment

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