Report: U.S. Oil Exports Surge

As oil continues to flow at a historic level in Texas, companies are facing two issues---getting it out of the ground, and getting it shipped out.  While a shortage of pipelines, trucks and workers is causing supply issues, a lack of dock capacity is slowing things down at ports.  A new report by Raymond James says bottleneck issues are expected to increase at the port level as the demand for exports continues to grow. This is primarily due to the need for docks to handle larger oil tankers. 

For those in the Texas oil business, it's just the latest issue to crop up due to the surging production of crude coming out of the Permian Basin and other areas.  "There's always bottlenecks," says John Hopkins with Houston-based Global Drilling Partners.  "A couple of years ago the bottleneck was drilling and getting enough rigs and enough people, and that's still somewhat of a problem...but the biggest one now is that the pipelines are just full."

Hopkins tells KTRH that the issues slowing down production and exports have only increased demand on the market.  "If there's only a certain amount of oil that can be taken away, it's going to go to the highest bidder," he says.  "It's almost like having one item at an auction.  If that one item is needed by everybody, and there isn't any more of it, then that is going to be bid up quite high."

In the meantime, companies are scrambling to meet that higher demand, both at the production and export levels.  "It has really sparked a fire under people to address the midstream (production) problems," says Hopkins.  "So there are a bunch of companies that are trying to increase their midstream capacity."

And with good reason.  The Raymond James report says U.S. oil exports are up 50 percent this year to more than 1.8 million barrels per day, and are projected to reach 4 million barrels a day by the end of 2020.

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