Exports are Changing Crude Oil Logistics
The US federal law that was recently passed to permit the exporting of crude oil continues to add new complexities to crude oil logistics in the Midcontinent region. Midcontinent crude oil exports can be very profitable, but can also present organizations with a very complicated transportation puzzle. Where it was once a typical practice for companies to simply transport crude from Midcontinent production locations to the closest refineries (most often located along the teas and Louisiana Gulf Coast) via gathering systems and pipelines for domestic use, businesses are now having to evaluate multiple origin/destination combinations using many movement legs with a multitude of transportation methods.
Not only are there domestic challenges with storage and transportation, but tankers also open up an entirely new set of destinations for crude oil and the possibility of multiple destinations on the same logistics movement. Instead of an organization having to consider, at most, a few dozen refineries when marketing the crude and planning the logistics, it can now potentially consider hundreds of potential refiners in several dozen countries.
With the logistics puzzle continuing to evolve, a comprehensive and adaptable solution for tracking, evaluating, and managing logistics is essential to the success of crude oil exports.
Richard Murphy, Product Manager for Crude Oil at Allegro, recently took a deep dive into this crude oil logistics puzzle, as well as solutions to help manage it, in Oil & Gas Financial Journal. Click here to read the full article.