Enterprise Products Partners is opening the northbound capacity of its Seaway pipeline, offering U.S. oil producers struggling to place their oil near the Gulf Coast to ship their barrels to the primary storage hub at Cushing, Oklahoma.
With the current crude oil turmoil in the United States due to the coronavirus pandemic, there is strong market interest to access the Cushing storage market . Enterprise Products Partners is now offering the unused capacity on its pipeline system from Fort Bend County, Texas, to Cushing. Oil could also flow south to the Gulf area.
The most recent U.S. pipeline construction has been designed for moving oil from big shale plays to the U.S. Gulf to take advantage of growing U.S. exports. But exports have fallen off as demand slumped and companies are scrambling for storage.
About 54% of total U.S. crude working storage capacity was full as of April 3, according to the U.S. Energy Information Administration.
Enterprise said it would offer service from Enterprise Katy in Fort Bend County, Texas, to Cushing. It plans to charge spot shippers $3 a barrel for the service, effective May 1, according to the filing.