Updates
February 13, 2012: Bradaz has provided some nice data points for price of Bakken crude:
Month EOG NET NYMEX DIFF
Jan 11 80.27 89.58 9.31
Feb 11 80.19 89.74 9.55
Mar 11 92.67 102.98 10.31
Apr 11 105.33 110.04 4.71
May 11 97.21 101.36 4.15
Jun 11 92.67 96.29 3.62
Jul 11 92.81 97.34 4.53
Aug 11 81.85 86.34 4.49
Sep 11 82.40 85.61 3.21
Oct 11 83.18 86.43 3.25
Nov 11 91.74 97.16 5.42
Dec 11 89.93 98.58 8.65
Original Post
Timing is everything.It was about a month ago that I commented on why a pipeline company was initiating crude-by-rail.
Today, I see there is an interesting discussion thread talking about those very points.
As Hunter S Thompson would say, this is the nut of the argument:
The argument at the Clearwater MN price somehow represents all that the oil drillers can get for their Bakken oil is lunacy. Unit trains can go anywhere on the continent where the price is sufficient to cover trhe transportation costs, and do. Some of the EOG trains have been going all the way to the Louisiana coast, where oil can be offloaded and shipped to Europe if necessary, to get the highest price. EOG (and the other companies too) employ. high-paid people to decide where each bbl of Bakken oil hould go to net the highest price to the operator (and mineral owner). THey are not somehow stuck selling it to Clearwater no matter what.Maybe more to follow.
Imagine: Gasoline at $5.00/gallon; oil at $125/bbl; and Bakken oil ending up in Europe.
Great companies are great because they realize what business they are in. The "aha" moment for Enbridge was when they realized they were not a "pipeline company."
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