Seeking Alpha

Trains keep rolling from Permian Basin on crude discounts

  • Volumes are poised to continue to move out by rail from the Permian Basin oil fields, as production outpaces pipeline capacity and a refinery outage saps demand.
  • West Texas Sour priced in Midland, Tex., fell yesterday by $2.75/bbl to a discount of $11.50 to WTI crude at the Cushing, Okla., delivery hub, the largest difference since March 20.
  • Also, Phillips 66 (PSX) reportedly plans to shut most of its 146K bbl/day refinery in Borger, Tex., for as long as 35 days after it was unable to recover from a power failure.
  • Output in the Permian has jumped by 79% since year-end 2009, with the basin now producing ~1.57M bbl/day.
  • ETFs: UNG, USO, OIL, DGAZ, UGAZ, UCO, BOIL, SCO, GAZ, BNO, DTO, DBO, KOLD, UNL, CRUD, NAGS, USL, UWTI, DWTI, DNO, SZO, DCNG, OLO, OLEM, TWTI
From other sites
Comments (6)
  • 27975573
    , contributor
    Comments (307) | Send Message
     
    Soooo..... should not the story be.....whom will move all that crude by rail??

     

    Therefore, I am looking at the rails... (CSX), etc.
    ....and the rail car makers (GBX), (TRN)..
    3 Jul 2014, 10:10 AM Reply Like
  • James Sands
    , contributor
    Comments (2431) | Send Message
     
    You are referring to CSX getting a tidal lift in Tennessee? The don't operate farther west than this to the oil plays in the information. I would think that UP and BN would be the reapers of this from a rail perspective.
    3 Jul 2014, 10:38 AM Reply Like
  • Greyfox070
    , contributor
    Comments (91) | Send Message
     
    $GMT....anyone?
    3 Jul 2014, 12:14 PM Reply Like
  • 27975573
    , contributor
    Comments (307) | Send Message
     
    Not a "tidal lift" ......
    A boost by overall rail usage; rates that they can charge are
    on the rise, and virtually no new rail lines to compensate.

     

    Also, do not forget the rail cars suppliers that I mentioned.
    7 Jul 2014, 11:06 AM Reply Like
  • James Sands
    , contributor
    Comments (2431) | Send Message
     
    Yea, I already sold my Trinity position recently which I bought back in February this year.

     

    Union Pacific is the best rail company to own and Trinity is the best rail car manufacturer. Both are better diversified than their respective peers.
    7 Jul 2014, 11:09 AM Reply Like
  • 27975573
    , contributor
    Comments (307) | Send Message
     
    Yes, I agree they are the best
    However, that does not mean I can not make money on others.

     

    AS they settle to more relevant valuations; I will get back in....
    In the mean time, I like my profits in (GBX) and (CSX).
    7 Jul 2014, 11:15 AM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs