Rail helps make Midwest a net shipper of crude oil

Rail movements out of the Midwest have contributed to the region becoming a net shipper of crude oil. Without these rail movements, the Midwest region would still be a net recipient. The Midwest started to ship more crude oil to other regions than it received for a few months in 2013 and on an annual basis in 2014.

Recent data

The most recent Petroleum Supply Monthly, which contains data through May 2015, shows an average of 1.7 million bpd shipped out of the Midwest during the first five months of the year, of which 638 000 bpd were transported by rail.

Past data

Between 2010 and mid-2012, pipeline shipments out of the Midwest were relatively flat at about 225 000 bpd until the reversal of the Seaway Pipeline, which now transports crude oil from Cushing, Oklahoma, to the Gulf Coast. Since then, Seaway has been expanded, and other pipelines such as TransCanada's Gulf Coast Pipeline, were built to carry crude oil out of the Midwest.

EIA reviews the increase

By May 2015, pipeline shipments from the Midwest reached 1.3 million bpd, the highest since EIA began collecting pipeline shipment data in 1986.

Crude-by-rail (CBR) volumes from the Midwest to the East Coast began to increase in 2012, as production increased in the Bakken region of North Dakota. The largest annual average CBR movement from 2011 - 2013 was from the Midwest to the Gulf Coast.

Midwest-to-Gulf Coast CBR movements started to decline in the second half of 2013, as less Bakken crude oil made its way down to the Gulf Coast because pipelines in the Permian Basin in Texas and New Mexico were built, expanded, or reversed to take Permian crude oil production to Gulf Coast refineries.

As Midwest-to-Gulf Coast CBR shipments decreased, Midwest CBR shipments to the East and West Coast increased to transport the steadily increasing crude oil production in the Midwest.

Edited from press release by Stephanie Roker

Read the article online at: https://www.worldpipelines.com/business-news/11082015/rail-helps-make-midwest-a-net-shipper-of-crude-oil/