Crude Oil Pipeline Constraints: A Tale of Two Shales

25 Pages Posted: 17 May 2022

See all articles by Phat V. Luong

Phat V. Luong

SUNY Polytechnic Institute, College of Business Management

Abstract

Permian and Williston Basins are both experiencing takeaway pipeline bottlenecks. The price of Bakken sweet crude in Williston is still cointegrating with the national WTI benchmark and downstream gasoline market while the Midland crude price in Permian Basin is not. This is because of the rail system developed in the Williston Basin that allows Bakken crude to reach other trading hubs and downstream markets even when pipeline bottlenecks occur. The Midland price only reintegrated with WTI as well as regional gasoline price after the takeaway bottleneck is alleviated.

Keywords: WTI, Permian, Midland, Williston, Bakken, basis differential

Suggested Citation

Luong, Phat V., Crude Oil Pipeline Constraints: A Tale of Two Shales. Available at SSRN: https://ssrn.com/abstract=4112017 or http://dx.doi.org/10.2139/ssrn.4112017

Phat V. Luong (Contact Author)

SUNY Polytechnic Institute, College of Business Management ( email )

100 Seymour Rd
Donovan 1101
Utica, NY 13502
United States

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