Midwesterners get ready for higher oil/gas prices.

[BMWTurboDzl]

The Trans mountain expansion has been delayed until the 2nd Q. This will give you Midwesterners in the US a temporary reprieve. You may ask why or how? The heavy oil produced out of Canada has had a limited market in which it can be sold (i.e. Midwest US down to Texas, with very small output to the west coast). This limitation has allowed the oil to be bought cheaper because there really was only 1 customer (i.e. US). Once the pipeline expansion to the West Coast has been opened the market for Canadian oil will be significantly expanded which gives them better pricing power.

https://www.cbc.ca/news/canada/calgary/trans-mountain-expansion-pipeline-further-delay-1.7098340

 

[fantastic]

Interesting chain of events.

 

[Rmay635703]

This is one of the reasons many people were against a certain other pipeline that was politicized into “making fuel expensive.”

The reality is most of these projects aren’t for the locals benefit .

This is similar to my area being a massive hub of regional multiple state power generation, locally we gain nothing from the extra power generated but we do get to pay through the teeth in extra fees for the privilege and get to enjoy extra pollution.

 

[Snagglefoot]

Looks like they are closing in on starting to fill the line. The line itself will hold two millions bbls of oil. Shipping should commence by July 1.

 

[Snagglefoot]

So the shipments are under way. The first loads went to China but this next load goes to California. I image any pricing change would take a long time. This morning WTI is $80.40 and WCS ( Western Canadian Select ) is $ 66.63, just under a $14 difference. We can check again in a years time.

 

[Snagglefoot]

Here is an update. Currently more oil is being shipped to California and Hawaii then to China. The spread between WTI ( West Texas Intermediate) and WCS ( Western Canadian Select) is still $14. I have found out that Alaskan crude is priced according to Brent prices which are $4 above WTI. It will be interesting to see what oil is in those tankers going to Hawaii, since the TMX ( Trans Mountain) line ships both heavy and light oil.