Little change in the amount of crude oil in storage at the Cushing Hub in northern Oklahoma is seen in the latest supply numbers released by the U.S. Energy Information Administration which show hub’s working operations are only about one-fourth of what they could be.
Cushing held 22,508,000 barrels of oil at the end of the week of August 28, reported the EIA. It was only a slight gain from the 22,428,000 barrels recorded at the end of the week of August 21. With a total working capacity of a reported 76 million barrels, the latest barrel report indicates the Cushing hub been operating at roughly 25% to 30% capacity.
Cushing has made a slow recovery since a low of 18,957,000 barrels recorded at the end of the week of June 19, an amount that put the hub and its massive storage tanks at risk because of heavy global demand for oil, a demand caused by the war against Iran and the stoppage of oil tankers through the Strait of Hormuz. The trickle of oil coming out of the Middle East resulted in spiked global demand for U.S. crude exports and as a result, it drew oil away from inland storage to the Gulf Coast ports.
The June low mark was followed by an even lower amount of 18,599,000 barrels of oil at the end of the week of July 24. Ever since, the recovery has been slow. What makes it critical for the Hug is traders view 20 million barrels as a threshold for safe pump suction and pipeline pressure. It’s a scenario called “tank bottoms.”
The next release date from the EIA will be September 10.
