Tag Archives: Oil storage

Coronavirus, Covid 19, Keeping Watch on Earth News, Oil Industry, Oil prices, Oil storage

Oil prices dip below zero as producers forced to pay to dispose of excess

US crude has negative value for first time in history as stockpiles overwhelm storage facilities

The Guardian, by Jillian Ambrose and Martin Farrer, April 20, 2020
A record 160m barrels of oil are currently being stored in oil tankers outside the world’s shipping ports. Photograph: US Department of Energy/EPA

US oil prices turned negative for the first time on record on Monday as North America’s oil producers run out of space to store an unprecedented oversupply of crude left by the coronavirus crisis.

The price of US crude oil collapsed from $18 a barrel to -$38 in a matter of hours, forcing oil producers to pay buyers to take the glut of crude which they cannot store, as rising stockpiles of crude threaten to overwhelm oil storage facilities.

“The problem of the global supply-demand imbalance has started to really manifest itself in prices,” said Bjornar Tonhaugen, head of oil at research firm Rystad Energy. “As production continues relatively unscathed, storages are filling up by the day. The world is using less and less oil and producers now feel how this translates.”

The Guardian reported over the weekend that a record 160m barrels of oil was being stored in “supergiant” oil tankers outside the world’s largest shipping ports, including the US Gulf, following the deepest fall in oil demand in 25 years because of the coronavirus pandemic.

The last time floating storage reached levels close to this was in the depths of the financial crisis in 2009, when traders stored more than 100m barrels at sea before offloading stocks when the economy began to recover.

The price collapse in US oil market – known in the industry as the West Texas Intermediate price – accelerated because it is the last day oil producers can trade barrels that are scheduled for delivery next month, when oil storage is expected to reach capacity.

The US price for oil delivered in June, which will become the default oil price from tomorrow, is also falling due to the economic gloom caused by the coronavirus, but has managed to remain above $20 a barrel. On Monday the price for brent crude, the most widely used benchmark, fell 8% to $25.79.

Concerns over the economy, which directly affect oil demand, have been heightened by the growing standoff between the US president and state governors over whether the US can begin to lift restrictions on movement and businesses.

Global oil prices are expected to begin recovering over the second half of the year as tight restrictions on travel to help curb the spread of the virus are lifted, raising demand for fuels and oil.

The world’s largest oil-producing nations have agreed a deal to hold back between 10m to 20m barrels of oil a day from the global market from May, and many oil companies are likely to shut their wells as financial pressures mount.

Cailin Birch, global economist at the Economist Intelligence Unit, said: “US crude oil production has begun to fall in the last two weeks, and will continue to fall in the coming months as already heavily indebted shale firms scale back activity or are forced into bankruptcy or consolidation.”

Despite the historic production cuts, most analysts believe that oil prices will fail to reach the same price levels recorded at the beginning of the year before the outbreak. The global oil price, under the brent crude measure, reached highs of almost $69 a barrel in January before plummeting to less than $23 a barrel at the end of March.

Bakken Crude, Crude By Rail, Derailment, Explosion, Local Regulation, Marine transport, Oil storage, Pipeline transport, Pittsburg CA, Pittsburg WesPac, Tar sands crude, WesPac Energy

Pittsburg Defeats WesPac: Biggest California Crude Oil Project Stopped in its Tracks

Repost from ForestEthics, Ethan Buckner’s blog
[Editor:  Also check out ForestEthics’ blog post by Eddie Scher, “Bay Area activists celebrate WesPac withdrawal of oil terminal proposal.” – RS]

Pittsburg Defeats WesPac: Biggest California Crude Oil Project Stopped in its Tracks

By Ethan Buckner, Dec 11, 2015

In the final days of 2015 the victories for the climate justice movement are coming fast and furious — fracking bans to pipeline wins to breakthrough climate policies. This week, after years of a hard-fought community-led campaign, we learned that the oil services company WesPac has withdrawn their permit applications to build the biggest oil terminal on the West Coast in Pittsburg, CA!

That means 242,000 barrels a day of toxic and explosive extreme crude oil from the tar sands and the Bakken will stay in the ground, and off the tankers, oil trains, and pipelines WesPac would have built to bring this dangerous crude to Bay Area refineries.

This is an extraordinary victory, and one that demonstrates that grassroots organizing can overcome the power of big oil. I remember two years ago hearing that “no one can organize in this town,” because for so long Pittsburg had been dominated by heavy industry after heavy industry, from petrochemical plants and waste dumps to power stations and oil facilities.

The campaign started out small, led by two courageous neighbors Kalli Graham and Lyana Monterrey, who started knocking on doors and enrolling more and more community members to the fight. I remember my first day canvassing outside the Pittsburg seafood festival in August 2013, thinking to myself, how the hell are we ever going to win this thing?

But as these brilliant and resilient grassroots leaders kept organizing, and it started working. Within months our volunteer base jumped from a handful to dozens, and then to hundreds. Petition signatures jumped from dozens to hundreds to thousands. At nearly every door I knocked on I met another community member sick of Pittsburg’s reputation as an industrial wasteland, tired industry control. I don’t think I’ve ever been anywhere where opposition to industry was so strong. When WesPac brought a company man to town to host a three hour informational meeting, community members showed up en masse and drove him out of town. Hundreds of citizens showed up at city council meetings, week in and week out. We hosted toxic tour, dozens of community meetings, and the biggest march Pittsburg has seen in many, many years. We turned the WesPac campaign into a regional and statewide issue, leveraging the power built in Pittsburg to inspire and support other campaigns fighting extreme oil infrastructure in the Bay Area and beyond.

In January 2014, WesPac agreed to take oil trains off the table. That was a big victory, but WesPac still wanted to build a crude oil tank farm, tanker berth, and pipelines, and we stood ready to continue the fight. But WesPac was not, and will officially pull their applications before a city council meeting on December 14.

Hats off to everyone who contributed to this extraordinary effort: especially the community leaders at the Pittsburg Defense Council and Pittsburg Ethics Council, and also Communities for a Better Environment, Sunflower Alliance, Sierra Club SF Bay Chapter, Natural Resources Defense Council, and 350 Bay Area, among others. This victory belongs to our movement, but most of all to the tireless, resilient, creative, and courageous people of Pittsburg.

Let WesPac’s demise serve as a warning to Valero, Phillips 66, and other oil giants that are trying to build oil train terminals in California right now: our movement will not stop until all oil trains projects are halted in their tracks, and extreme oil stays in the ground where it belongs.

Bakken Crude, Crude By Rail, Derailment, Explosion, Local Regulation, Marine transport, Oil storage, Pipeline transport, Pittsburg CA, Pittsburg WesPac, Tar sands crude, WesPac Energy

Bay Area activists celebrate WesPac withdrawal of oil terminal proposal

Repost from ForestEthics
[Editor:  Also check out ForestEthics’ blog post by Ethan Buckner, “Pittsburg Defeats WesPac: Biggest California Crude Oil Project Stopped in its Tracks.”  (Great photos.)  – RS]

WesPac Energy Withdraws Pittsburg, CA, Oil Terminal Proposal

Activists to attend the upcoming city council meeting at Pittsburg City Hall on Monday, December 14 at 7:00pm

By Eddie Scher, ForestEthics, Wednesday Dec 9, 2015
[Pittsburg, CA] On November 16, WesPac Energy formally withdrew its proposed 242,000 barrel-per-day oil storage and transfer facility in Pittsburg, California. The crude oil facility would have included a marine port for oil tankers, more than a dozen oil storage tanks, an oil train offloading terminal, and multiple pipelines to local refineries.

In 2014 WesPac agreed to remove the oil train component to the project due to mounting community pressure and a scathing letter from California Attorney General Kamala Harris, but still planned to move ahead with the tank farm, marine berth, and pipeline extensions.

To celebrate the victory local activists will attend the upcoming city council meeting at Pittsburg City Hall on Monday, December 14 at 7:00pm.

Members of the coalition of citizen organizations working to protect the people and environment of Pittsburg released the following statements:

“We knew that WesPac was not good for our community and having them as our neighbor would do nothing to make Pittsburg a better place to live” saysKalli Graham, co-founder of the Pittsburg Defense Council.  It was time for us to roll up our sleeves and take action. We had homes to protect and families to keep safe. We did everything we could to tell everyone who would listen that this project was wrong. We canvassed our neighborhoods, lobbied our city and county officials and educated our community on the dangers this project would have on our town. We organized a grassroots movement, created a non-profit organization and rallied our community into action. We stood together as neighbors to fight this project until we’d stalled it for so long that it was no longer viable. We took a stand against the biggest, dirty industry this planet has known so far and we WON!”

“The citizens of Pittsburg stood toe to toe with the oil industry, they did not blink, they did not flinch, and today they have won,” says Ethan Buckner, ForestEthics extreme oil campaigner. “Thanks to the leadership of Kalli Graham and the Pittsburg Defense Council, and thousands of Pittsburg residents, it is clear that oil trains, tankers, tank farms, and pipelines are not welcome here. Here’s a message to Phillips 66, Valero, and other oil companies with dangerous oil trains projects in the works: The people of California and across North America don’t want your extreme oil, we want clean energy and climate solutions.”

“The WesPac crude by rail project was clearly designed to import dirty Canadian tar sands to Bay Area refineries,” says Andrés Soto, Richmond organizer with Communities for a Better Environment. “This victory is not enough. To protect us from future dirty oil projects, the Bay Area Air Quality Management District must adopt strict limitations on refinery emissions now.

“Thanks to the people of Pittsburg for sending this clear signal to the City of Benicia and Valero that Valero’s dangerous crude by rail project is not only a bad idea, it is no longer economically viable,” says Katherine Black, organizer with Benicians for a Safe and Healthy Community.

“WesPac’s own environmental review documents, inadequate as they were, showed that the project would harm this community and the environment by polluting the land, air, and water” says Jackie Prange, Staff Attorney at Natural Resources Defense Council. WesPac made the right choice to give up now rather than face defeat in court.”

“I’ve often considered the WesPac project to be the Bay Area’s Keystone XL – a perfect example of new fossil fuel infrastructure that would enable the oil industry to grow,” says community organizer Martin Mackerel. I couldn’t be happier that we stopped this project from being built. I hope our victory inspires others to block all new fossil fuel infrastructure in their backyards. Together we can stop this industry from murdering humanity’s future.”

“WesPac’s dangerous and grandiose plans for a mega-oil terminal in Pittsburg have been thwarted not only by market forces—OPEC and faltering oil barrel prices—but by a force of nature commonly known as People Power, the combined efforts of nameless individuals driven not by profit motives but by fierce love of community and desire for ecological sanity,” says Shoshana Wechsler of the SunFlower Alliance.

“The WesPac oil storage facility would have posed significant pollution threats to San Francisco Bay. San Francisco Baykeeper is proud to have been part of the team that stopped WesPac, and we’ll continue our work to protect the Bay from the expansion of oil refining and oil transport in the Bay Area,” says Sejal Choksi, San Francisco Baykeeper.

“Pittsburg is a strong community, and one that determined that we were not going to allow the hazardous WesPac project to be placed in our backyard,” says Gregory Osorio of the Pittsburg Ethics Council. “Many people worked countless hours – first Lyana Monterrey who started the organizing in Pittsburg before the WesPac project was on ANYONE’s radar. To George Monterrey for his ‘fire’, and Danny Lopez, the graphics artist for the movement. The credit for this victory belongs to the nonprofit environmental groups such as Forest Ethics, NRDC, Sierra Club, and Sunflower Alliance, who all made enormous contributions. We wish to thank everyone who labored tirelessly to keep this potentially catastrophic project from being dumped in our backyard.”

Air Quality, Crude By Rail, donner, Electronically controlled pneumatic braking (ECP), Emergency Readiness & Response, Explosion, Noise pollution, Oil stabilization, Oil storage, Positive Train Control, Revised Draft EIR, Valero Benicia Refinery, Valero Crude By Rail

Davis Enterprise Editorial: Benicia washes its hands of us

Repost from the Davis Enterprise

Our view: Benicia washes its hands of us

By Our View | November 15, 2015

The issue: Bay Area city can’t see past its own back yard on refinery project

The city of Benicia — the only entity capable of exerting any control over the crude-oil shipments set to arrive at a planned expansion of a Valero oil terminal — has shown in a draft environmental impact report that any impact the terminal has on communities farther up the train tracks is none of its business.

THE PROPOSED project would allow Valero to transport crude oil to its Benicia refinery on two 50-car freight trains daily on Union Pacific tracks that come right through Davis, Dixon, Fairfield and Suisun City on their way to Benicia. The rail shipments would replace up to 70,000 barrels per day of crude oil currently transported to the refinery by ship, according to city documents.

The original draft EIR, released in 2014, didn’t adequately address safety and environmental concerns. Local governments — including the city of Davis, Yolo County and the Sacramento Area Council of Governments — weighed in on the draft, urging Benicia to take a second look.

Benicia withdrew the draft and went back to work, and the new document acknowledges the risks of pollution, noise and, oh yes, catastrophic explosions from oil trains, the likes of which leveled Lac-Mégantic, Quebec, in 2013.

Disappointingly, having recognized the issues involved, the report simply says there’s no way to mitigate them and recommends moving ahead. With a bureaucratic shrug of the shoulders, the concerns of communities from Roseville to Suisun City are dismissed.

NATURALLY, SACOG disagrees, and so do we. While it’s true that there’s not a lot Benicia can do itself to mitigate the impact of its project, it can force Valero to do something about it.

SACOG urges a raft of measures that are within Valero’s control: advanced notification to local emergency personnel of all shipments, limits on storage of crude-oil tanks in urban areas, funding to train emergency responders, cars with electronically controlled pneumatic brakes, money for rail-safety improvements, implementation of Positive Train Control protocols and, most importantly, a prohibition on shipments of unstabilized crude oil that hasn’t been stripped of the volatile elements that made Lac-Mégantic and other derailments so catastrophic.

Due to federal laws, cities along the railway lines have no ability to control what goes through. Only Benicia, now, while the project is still on the drawing board, has the authority to set reasonable limits and conditions on a project that puts millions of people along the railroad in harm’s way.

We urge the Benicia City Council to use its discretionary authority in this matter to protect those of us who have no say in the process.