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Oil Markets Turn Bearish Ahead Of OPEC Meeting

Oil Markets Turn Bearish Ahead Of OPEC Meeting

Oil prices fell on Tuesday…

Plans for a New Pipeline to Rival Keystone XL

New technologies in shale oil drilling, and the Alberta oil sands means that there is a glut of oil in Canada and the northern US with very few transportation options. This has led to trade prices far lower than world crude prices, and therefore there is an eagerness to get this oil to the coast for refinement and shipping.

Following the rejection of approval and the general uncertainty surrounding the Keystone XL pipeline, two companies have now released plans to create a new pipeline which will move crude oil to the Gulf Coast.

The $2 billion pipe will run from Cushing, Oklahoma to Houston, Texas, and be developed as part of a collaboration between Enbridge Inc. of Alberta and Enterprise Products Partners LP. of Houston. Enbridge will also build a pipeline from Flanagan, Illinois to Cushing, where it would link in to existing pipelines and offer oil produced in the Bakken fields of North Dakota access to Gulf Coast refineries.

Enbridge and Enterprise already own a pipeline that runs from Houston to Cushing, but are now working to develop a new pipe to run parallel which will deliver about 850,000 barrels per day southwards from Cushing to the Gulf Coast.

Patrick D. Daniel, the CEO of Enbridge, said that “Enbridge’s Gulf Coast access projects give Bakken and western Canadian producers timely, economical and reliable options to deliver a variety of crudes to refinery hubs throughout the heart of North America and now as far as the Gulf Coast.”

By. Charles Kennedy of Oilprice.com



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