America is pumping so much oil that it's running out of places to keep it all.The U.S. now has nearly 503 million barrels of commercial crude oil stockpiled, the Energy Information Administration said on Wednesday.
It's the highest level of supply for this time of the year in at least 80 years.The sky-high inventories are the latest sign that the U.S. oil boom is still alive and kicking.
U.S. oil production is near all-time highs despite the epic crash in oil prices from $107 a barrel in June 2014 to just $30 a barrel now.Sure, domestic oil production has slowed — but just barely.
Oil stockpiles are so high that certain key storage locations are now "bumping up against storage and logistical constraints," according to Goldman Sachs analysts.
In other words, these facilities are nearly overflowing.Cushing, Oklahoma is the delivery point for most of the oil produced in the U.S. This key trading hub is currently swelling with 64 million barrels of oil.
That represents a near-record 87 percent of the facility's total storage capacity as of November, according to the EIA."There is a fear of tank topping in Cushing. We're seeing it get to its brims," said Matthew Smith, director of commodity research at ClipperData.
Cushing has had to ramp up its storage capabilities in recent years just to deal with all this oil. If this key hub ran out of room to stockpile oil, that crude would have to be diverted elsewhere, and that would hurt oil prices."There would be a ripple effect across the U.S. that would impact prices everywhere," said Smith.
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