Crude Oil

PetroChina’s recent decision to offload its 20-year commitment to use the Trans Mountain Pipeline expansion (TMX) might seem like a bit of a head-scratcher on the surface, especially since Asian buyers have been expected to take advantage of the increased access to Western Canadian crude oil that TMX provides. But when you factor in the known challenges of utilizing the new pipeline and the reduced demand for crude oil in China, PetroChina’s decision to sell its commitment to Canadian Natural Resources Limited (CNRL) starts to make sense. In today’s RBN blog, we look at the challenges buyers face in using the TMX system despite its obvious perks. 

Strategic Petroleum Reserve (SPR) inventories have been climbing over the past year as the Department of Energy (DOE) advances plans to replenish it following the record 180-MMbbl drawdown after Russia’s invasion of Ukraine in 2022. But DOE officials have said its refilling efforts are complicated by upgrades at three of the four SPR storage sites. In today’s RBN blog, we look at the scope of these “life-extension” projects, the completion timetable, and how it might drag out restocking efforts. 

The Atlantic hurricane season often evokes worries about the oil and refined products industry, even far up the East Coast, thanks to the widespread impact of Superstorm Sandy a dozen years ago. But electricity production could also be at risk should a major storm once again make its way up the Eastern Seaboard thanks to the large-scale wind farms under development there. In today’s RBN blog, we’ll examine the threats, how they might impact Atlantic Coast wind power, and how offshore turbines are designed to withstand severe storms. 

Midland, TX, is the epicenter of the Permian Basin. As the largest crude oil hub in the region, it boasts about 20 MMbbl of crude oil storage and extensive downstream connectivity, with the ability to deliver to local refineries, Wichita Falls, Cushing, Nederland, Houston and even Corpus Christi (albeit indirectly). It’s also where Midland WTI pricing is assessed, shaping much of the broader oil market in the region and even around the world. In today’s RBN blog, we discuss why Midland is the center of it all. 

The International Energy Agency (IEA) and others have lowered growth targets for global oil consumption in the short term, while traders began a sell-off in crude benchmarks before the recent recovery in oil prices. Their main concern? China, which has accounted for a large part of global demand growth, has recently seen a sharp drop in oil demand due in part to an economic slowdown as well as a sharp increase in electric vehicle (EV) adoption. In today’s RBN blog, we will examine what’s happening in China, what it means for global oil demand, and where additional demand growth might come from. 

In the far western reaches of the Permian Basin lies Orla, TX — a town steeped in history and significance. Orla, which can be fittingly translated into “border” in Spanish, is about 40 miles north of Pecos, near the New Mexico border in Reeves County. Founded in 1890 as a section house for the Pecos Valley Railroad, Orla evolved from a modest stop along the tracks to a bustling oil supply hub — not your typical hub with lots of tank farms close together but still a heavy throughput area — by the 1960s. Though often considered a ghost town today, with a population thought to be in the single digits, Orla remains a vital player in the oil industry. As the origin region for several major takeaway pipelines in the Permian, this once-thriving community continues to serve as a crucial link in the region’s vast network of oil exploration, extraction and transportation, particularly along heavily traveled U.S. Highway 285. In today’s RBN blog, we look at the role that Orla plays in crude oil takeaway from the prolific Permian Basin. 

The Denver-Julesburg Basin isn’t the Permian — no argument there. But like its much bigger brother in West Texas and southeastern New Mexico, the DJ Basin has been a hotbed of M&A in both the upstream and midstream sectors. Among DJ producers, Chevron, Civitas Resources and Occidental Petroleum (Oxy) are now the top dogs, with big hopes for the future there. And, as we’ll discuss in today’s RBN blog, a handful of midstreamers have taken on leading roles in crude oil and gas gathering (and processing) in Weld County, CO, the heart of the basin.