Cushing Oil Finally Released To The Gulf
After a glut of oil has piled up in Cushing, OK, the Seaway pipeline has finally completed work in order to begin sending oil to the coast. The pipeline was originally built in 1995 to send oil to Cushing where it could then be sent to where needed in the MidWest. Of course, this was back in the days when oil wasn't being produced on land. Fast forward to 2011 and domestic production in North Dakota combined with oil from Canada had suddenly clogged up the storage tanks in Cushing. What has always amazed me is what did people expect when Cushing kept building new storage tanks? Last week inventories rose 1M barrels to a record 45M. That is what happens when you build pipelines into a area, build up tanks to store the goods, but then don't have adequate pipelines out of the area! The 150K barrel per day pipeline will help the glut in Cushing as that amounts to 4.5M barrels a month. What it has already done is reduce the spread between the WTI and Brent crude prices that re...