Pipelines in the biggest U.S. Oil patch reach their limit

posted by iHeartMedia's Scott Crowder -

Pipelines in the Permian Basin are said to be near capacity and some wells will have to shut because there aren't enough pipelines to deliver the oil. What will this mean for the average driver? Probably not much.

Oil analyst Mike Lynch says the lack of pipelines isn't the result of crazed environmentalists opposing them.

"I don't think that's a factor in the case of the Permian because it's just that the production has grown so much it has outgrown the existing capacity and it takes time to plan and build a pipeline."

Lynch says this may affect gasoline prices a bit but probably not much.

"I don't think so; the only question would be, for the very long term, if it turns out the Permian is close to a peak in productive capacity."

But Lynch says he doubts the Permian is near its peak.

Lynch says there's not a lot that can be done in the short term.

"Unless you can come up with, say, a convoy of oil tanker trucks or something like that, there's really very little that can be done in the short term."

Lynch says there might be a slight bump in gas prices but nothing for the average driver to worry about.

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