CP expects crude-by-rail rebound

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CALGARY, Alberta — Canadian Pacific’s crude-by-rail shipments are “coming alive a little bit,” according to a statement given by Chief Marketing Officer John Brooks on Tuesday.

Crude-by-rail shipments in Canada suffered after pipelines were opened and a dip in worldwide demand in 2015. Now, though, the abandonment of a proposed pipeline from Alberta and several oil sand producers scheduled to begin producing have created a favorable outlook for crude-by-rail volumes in 2018.

“With new production expected to come online in the next year … [Canada is] about to reach the limits of current pipeline infrastructure,” Reuters quoted the consultancy firm Turner Mason & Co. saying in a statement. “This will likely result in a need to turn to rail as a stopgap to allow the new crude production to reach refineries.”

Canada is currently shipping 93,000 barrels of oil by rail per day, a 40-percent decrease from a yearly peak of 156,000 barrels a day in March 2017. However, analysts expect that shipping discounts set to expire will make crude-by-rail a more favorable shipping option in 2018.

See the original article online.
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