[Aleenkagirlla]

Why exactly do you think that Canadian oil that's pipelined down to the Gulf for refining before being trucked/railed around the nation is any cheaper than tanker oil?

Because I know the people who have done the financial models. It's absolutely much cheaper to get oil via pipeline from Canada than it is shipping it in from the gulf.

[bF8CCmmr]

Actually, it very likely is from some tanker leasing company's PR department or marketing materials.

Why do you think they give the metrics in gallons when the industry uses barrels? 1 barrel = 31 gallons.

That is very likely the rate the tanker company charges. What that rate does not include is the bulk of the expense: the transferring & storage charges.

Suuuuuure it is. It's inconceivable that the writer of the article decided to use gallons because the reader is probably more familiar with that unit of measurement. Because, you know, the reader is really likely to give a **** about what measure the industry is using.

[AbeldeldepBug]

dp

[jhfkgkfdvjk]

It's actually driving down US prices compared to overseas prices, by ~$10 on average. Why is that? ...

Explain the WTI and Brent price differential. Go ahead and try.

According to the article you posted, it's because of a pipeline constraint that the Keystone XL would rectify. Thanks for providing another reason why Americans shouldn't want the pipeline.

We have all heard at least a partial explanation as to why West Texas Intermediate (WTI) and Brent prices are so far apart. We have been told that the Midwest is oversupplied because of all of the Canadian imports, and the crude oil cannot get down as far as the Gulf Coast, because while there is pipeline capacity to the Midwest, there isn’t adequate pipeline capacity to the Gulf Coast. ...

Some have suggested that TransCanada’s Keystone XL pipeline (labeled as “3″ on Figure 8 ) will help solve the problem, when it is completed in 2013.

[mv37afnr]

As a side note before bed, a couple months ago my SO (who works for a very large engineering company) was put on a new project. He's a chemical engineer and is working on plans for a new pipeline out to BC. And I guarantee you that its job isn't to ship oil down south.

[DevaRextusidis]

This makes no ****ing sense. A reader doesn't know what the **** good a "gallon of oil" is -- in fact, they're likely to confuse it with a gallon of gasoline (which I'm sure is the intent).

On the other hand, the price of Oil is always reported in price per barrel. THIS is the metric the reader is more familiar with.

Are people really that familiar with barrels? I though a barrel was 42 gallons but you said there's 31 gallons in a barrel, so now I'm confused.

[seodiary]

Are people really that familiar with barrels? I though a barrel was 42 gallons but you said there's 31 gallons in a barrel, so now I'm confused.

They're familiar with the price of oil as it's always reported in the news.

I bet 0.01% of the population understands what a gallon of oil is good for. What's important is the perspective -- how much does it increase the cost for oil? Considering 99.99% of people know the price of oil in terms of price per barrel, that is the obvious choice for a metric. But they instead chose gallon. Because then it sounds like just a couple pennies..ain't no thang.

[phernikas]

Well, if you're not going to increase production, then the US won't benefit. It won't be hurt, however, as it still doesn't matter where you ship the oil.

You would be absolutely correct if:
1) We lived in a world without transportation cost
2) The infrastructure to transfer oil at a reasonable cost was in place to handle shifts in where oil is coming from, which it's not
3) Capacity was infinite

The reality of the world is it very much DOES matter where you ship the oil. Which is exactly why there is a large price spread between Brent and WTI.

[Stengapsept]

They're familiar with the price of oil as it's always reported in the news.

I bet 0.01% of the population understands what a gallon of oil is good for. What's important is the perspective -- how much does it increase the cost for oil? Considering 99.99% of people know the price of oil in terms of price per barrel, that is the obvious choice for a metric. But they instead chose gallon. Because then it sounds like just a couple pennies..ain't no thang.

Yes, only .01% of the public understands that oil is good for shipping to refineries to make gasoline. But, they instinctively know how much, say, a 1% increase in the price of oil would increase the price of the gasoline they buy.

[Fhgzmftq]

We are to the extent that matters for this argument, you moron.

Completely and utterly false. You guys have no clue whatsoever how much it costs to ship oil.

You know how much it costs to ship oil from North Dakota to the Gulf?

$15 per barrel

[cenRealliat]

Yes, only .01% of the public understands that oil is good for shipping to refineries to make gasoline. But, they instinctively know how much, say, a 1% increase in the price of oil would increase the price of the gasoline they buy.

Actually, they've no ****ing idea...and neither do you. a 1% increase in oil does not mean 1% increase in gasoline.

[freddyujnf]

No, it doesn't, which is why you've yet to produce any evidence that it does.

Sorry, what evidence are you looking for?

That it costs a lot more money to build triple-hulled tankers with obscene insurance premiums to haul oil from Arabic countries to the other side of the world, to build massive storage facilities at both the source and destination, to operate the very expensive (and time consuming) transferring equipment to load and unload the containers and then ship it to the refiners...than it does to send a steady supply of oil through a pipeline from your closest neighbour direct to refineries?

I can't give you the gift of critical thought.

[VipInoLo]

Sorry, what evidence are you looking for?

I'd settle for pretty much anything at this point.

[unioneserry]

Who cares? Oil is fungible.

When you're discussing oil tranportation infrastructure, this is moot.

[limpoporanique]

No, it won't.

Yes it will. A pipeline is the cheapest available way to ship oil. With a pipeline the price of oil at destination will drop.

[didrexx]

Yes it will. A pipeline is the cheapest available way to ship oil. With a pipeline the price of oil at destination will drop.

Sanity

[mr.videomen]

Sorry, but I don't consider a dollar a barrel or so (reasonable estimate of spread across different NA cmls) negligible. The US consumes 20 million barrels a day...