Reports: Stockpiling Crude Oil In Cushing

The world is swimming in oil, now that rigs in the U.S. are pumping at levels not seen in decades. A side effect of that oil glut is finding places to store the oil.

Friday, January 9th 2015, 11:19 am

By: News On 6

Reports: Stockpiling Crude Oil In Cushing

The world is swimming in oil, now that rigs in the U.S. are pumping at levels not seen in decades. A side effect of that oil glut is finding places to store the oil.

The Wall Street Journal reports storage facilities in Cushing, which were drained to six-year lows in August, are filling up again. Cushing in Payne County is the delivery point for the benchmark U.S. oil contract.

The paper says the futures market is making it profitable to put more oil in storage, so supply levels at Cushing are likely to get even higher in the coming months.

An Energy Information Administration report shows a 1.3 million-barrel rise in supplies in Cushing, where traders take physical delivery of Nymex-traded oil barrels.

The Wall Street Journal says producers are storing oil in Cushing while they waited for new pipelines to be built.

A year ago, a new pipeline opened, connecting Cushing to the Gulf Coast. By mid year additional pipelines opened to bring more oil into Cushing.

1/22/2014 Related Story: Oil Flowing From Cushing To Houston In Keystone XL Pipeline

The WSJ says amount of oil stored at Cushing is back to its February 2014 levels and still growing.