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AlwaysFree: About Half Of US Crude Oil Pipeline Capacity Is Unused: Survey

Author: SSESSMENTS

An industry survey showed that overall US crude oil pipeline capacity utilisation stood at 50% recently, an industry survey showed. This compares to 60% to 70% headed into early 2020 before the COVID-19 pandemic hit. Analysts said companies built pipelines amid a production boom in 2019 when US crude oil production surged to 13 million bpd. However, the pandemic caused a downturn, with US crude output averaging just 11 million bpd in 2021. As a result, there is too much unused pipeline capacity.

The underutilisation is heating up the competition, especially in higher-production regions such as the Permian Basin in Texas. Some Permian midstream operators have cut their shipping rates to entice users. In contrast, shipping rates have increased in regions with less pipeline capacity. Lower rates are expected to directly affect the performance of those midstream operators. However, these companies are expected to wind down those cheap offers in line with the gradual improvement in production.

Tags: AlwaysFree,Americas,Crude Oil,English,US

Published on December 17, 2021 11:05 AM (GMT+8)
Last Updated on December 17, 2021 11:05 AM (GMT+8)