Starting in 1977 the United States has acquired 62 enormous salt caverns along the coastlines of Louisiana and Texas to store crude. The salt caverns were developed by drilling wells into the huge salt domes and injecting them with freshwater to dissolve the salts. The dissolved salt solution is then transported by pipes to disposal wells. By enacting this process of “solution mining” precise dimensions are created which can hold anywhere from 6-35 million barrels of oil, as stated in the diagram. These reserves are used in the event of national disasters, major storms, or outages in oil producing countries. Last year when Hurricane Harvey hit Texas, 5.3 million barrels of oil were sold from the government to four refiners to help aid in the fuel shortage. Currently, we have 260.1 million bbls of sweet crude (petroleum with less than 0.42% sulfur) and 405.4 million bbls of sour crude (petroleum containing high levels of sulfur) totaling 665.5 million bbls since March 9th 2018. This week the U.S. Department of Energy said it would sell 7 million barrels of sweet crude oil to comply with a law enacted in 2015 to help fund the government. The DOE will be accepting offers on this oil until March 21st and deliveries will hail from the SPR West Hackberry site from May 1st – 14th and from May 1st – 31st from the Bryan Mound site.
Today the EIA (Energy Information Administration) reported, that crude oil exports from the U.S. have nearly doubled since 2016. In 2017, the U.S. exported 1.1 million barrels of crude per day on average. How did this occur, the EIA states that, “U.S. crude oil exports were supported by increasing U.S. crude oil production and expanded infrastructure.”
On March 13th 2018, President Donald Trump relieved Rex Tillerson of his Secretary of State duties. In a speech on Tuesday, President Trump cited differing opinions between himself and the former Exxon executive as the reason for the firing. CIA Director Mike Pompeo is slated to replace Tillerson, of whom the President said, “With Mike Pompeo, we have a similar thought process.”
In today’s world, it is not uncommon for any one of us to order an item online and have it arrive at a store or our homes. We rarely stop to think about the logistics concerning the transportation of those goods throughout the country. There is a growing concern in the marketplace that the increase of shipped goods is growing at a rate that trucking companies cannot conceivably keep up with. According to Bloomberg, “The trucking industry is unique because it's the lifeblood of moving goods around the country, representing 70 percent of the nation's freight volume by weight. Without enough trucks and drivers on the road, some combination of things is going to happen: Shipments will be delayed, and producers will have to pay higher prices to get goods to market.” For example, if you try to order a car service like Uber on New Year’s Eve or during a peak hour, your rate will be exponentially higher than the normal rate. According to the American Trucking Association, “…driver shortfall could reach 50,000 positions by the end of this year and if trends hold, will grow to more than 175,000 by 2026.”