By May 7, 2015 Read More →

Oil by rail shipments are 52% of supply to East Coast refineries

Canadian oil sands production increasingly shipped to East Coast oil by rail

Monthly oil by rail receipts accounted for more than half (52%) of the crude oil supply to East Coast refineries in February.

oil by rail

Source: U.S. Energy Information Administration, Petroleum Supply Monthly Note: All sources are net receipts except field production. PADD is Petroleum Administration for Defense District.

As U.S. and Canadian production of crude oil has increased, crude supply by rail to East Coast (PADD 1) refineries has grown, displacing waterborne imports of crude oil from countries other than Canada, such as Nigeria.

While refinery utilization in Petroleum Administration for Defense District (PADD) 1 in early 2015 has been below typical levels, this still marks the first time in EIA’s dataset that crude deliveries by rail have accounted for such a high percentage of East Coast refinery supply.

The growth since 2010 in inland domestic and Canadian crude oil production created an opportunity for U.S. and Canadian railroads to move crude oil to U.S. refining centers on the Gulf, East, and West coasts as well as to refineries in Canada.

Much of the crude oil moved by rail is produced from the Bakken Shale in North Dakota and eastern Montana. Bakken crude supplied by rail to U.S. East Coast refineries, along with U.S. crude production supplied by marine vessels from the Gulf Coast, has reduced demand for foreign crude oil at the East Coast refineries.

oil by rail

Source: Source: U.S. Energy Information Administration, Petroleum Supply Monthly Note: PADD is Petroleum Administration for Defense District.

In January 2014, domestic crude oil accounted for half of all East Coast refinery crude oil receipts, and crude-by-rail net receipts to the East Coast surpassed non-Canadian crude oil imports.

The growth in crude-by-rail shipments to East Coast refineries has been made possible by expansions in the capacity to load and unload crude oil from trains. Some facilities handle individual rail cars or a small number of rail cars (known as manifest trains), and others are built for unit trains, which consist of 80 to 120 rail cars carrying crude oil.

Rail terminals are now better equipped to load and unload oil by rail unit trains.

Five years ago, U.S. rail loading capacity for crude oil was almost entirely for manifest trains, but now more than 30 loading terminals throughout the United States can accommodate unit trains. On the East Coast, 10 terminals can unload crude oil unit trains. Crude-by-rail unloading facilities are located on both refinery property and at nonrefinery sites that have access to additional modes of transportation, including marine and short-distance pipeline, that allow the crude oil to be shipped on to refineries.

As more unit train unloading terminals have been added, some volumes that previously transferred to vessels in Albany before moving on to refineries in New York Harbor, the Philadelphia area, and Canada now are moved directly by rail closer to their ultimate destinations.

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