Cushing crude oil storage decline slows

Figure 3. Cushing crude oil storage capacity utilization and price spread

Crude oil inventories at the Cushing hub in Oklahoma are reported at 26.4 million barrels, 50% below the previous five-year average. The amount is the same as a week ago.

The U.S. Energy Information Administration says the amount of crude in Cushing was also 31% of the working storage capacity in the huge tank farm.

Dwindling crude supplies at Cushing still in the spotlight – Oklahoma Energy Today

The 26.4 million barrels of oil is more than 56% less than the 60.4 million barrels stored in Cushing the same week a year ago. Two years ago, the Cushing hub had 46.5 million and this week’s amount is 43.3% less according to the EIA.

What’s behind the continuing decline? The EIA explained it is due to a shift in crude oil flows away from Cushing while the Capline pipeline is being filled is likely contributing to low crude oil inventories in Cushing.

Capline Pipeline Company LLC announces Binding Open Season for Capline Reversal

 

The Capline pipeline is expected to reverse the flow direction to move crude oil to the U.S. Gulf Coast in early 2022.

The oil is expected to flow through what is called the Capline Reversal project which will transport oil from the Midwest and Cushing to South Louisiana.

 

The reversal of Capline is currently in the construction phase and is expected to be completed in 2021 according to Capline. This reversal will have two distinct origination points. One will be the storage hub of Cushing, Oklahoma. Through a joint tariff with Diamond Pipeline, Capline will be able to deliver light crude oil from Cushing to the various terminals in St. James, Louisiana. In addition, Capline will transport light or heavy crude oil from Patoka, Illinois, to St. James, Louisiana.