storage

Strategic Petroleum Reserve (SPR) inventories have been climbing for more than a year, but they could go much higher if President Trump has his way, as one of his major campaign promises was to refill the SPR “to the very top,” a goal he has repeated since his return to the Oval Office. Current inventories sit just below 400 MMbbl, leaving the SPR about 320 MMbbl shy of maximum capacity. But the refilling process may not be as straightforward as one might think, as three of the four SPR storage sites have experienced construction upgrades in the last year — which means things could go slower than anticipated. In today’s RBN blog, we’ll discuss the challenges of filling up the SPR and detail four scenarios for how the process might play out. 

The small town of Cushing, OK, occupies a central place in the U.S. crude oil market thanks to its hundreds of storage tanks and numerous pipeline connections. And while it might seem far removed from the factors that influence the global crude market, what happens elsewhere directly impacts the storage volumes at Cushing. In today’s RBN blog, we review the critical role that Cushing plays in crude oil storage, show how the forward curve can influence inventories, and look at what might be behind the recent uptick in storage levels, which followed a four-month slide. 

Over the past decade, the only significant growth market for U.S. crude oil and NGLs has been exports, with over 90% departing from the Gulf Coast. Exports via Gulf of Mexico ports have surged from about 1 MMb/d in 2016 to over 6 MMb/d last year. Great news for PADD 3 export facilities, right? Well, it’s not that simple. The distribution of barrels has been wildly uneven, resulting in significant winners, forlorn losers, and everything in between. And export volumes are still ramping up, as is the competition among marine terminals for crude and NGL export market share, with far-reaching consequences for producers, midstreamers and exporters. This is one of the core themes at our upcoming NACON conference, which is all about PADD 3 North American Crude Oil & NGLs and scheduled for October 24 at the Royal Sonesta Hotel in Houston. In today’s RBN blog, we’ll delve into the highly competitive liquids export landscape, consider some of the important factors driving flows one way or the other, and — fair warning — slip in some subliminal advertising for the NACON event. 

Enbridge’s recent $200 million deal to buy two marine docks and land in Ingleside, TX, from Flint Hills Resources (FHR) may not be much of a surprise, as expanding its role in U.S. crude exports has been part of Enbridge’s strategy since it bought Moda Midstream’s big marine terminal next door nearly three years ago. The former Moda terminal, now known as the Enbridge Ingleside Energy Center (EIEC), can receive and partially load Very Large Crude Carriers (VLCCs) — a key reason why the facility is #1 in crude exports in the nation. In today’s RBN blog, we will take a closer look at Enbridge’s deal with FHR and how it might help grow its crude export volumes.