Oil storage by the numbers
How much oil is in storage around the world?
by Alberta Venture Staff
With the price of oil an indicator of available supply, one would expect the historically low price of WTI to represent inversely large stockpiles of crude. That’s true, but there’s more to the story: in many inventories across the world, we don’t know exactly how much oil sits in storage, and that adds volatility to the market price.
China and Russia – whose combined production of almost 15 million barrels per day accounts for about 25 per cent of global oil output – don’t report storage levels at all. Singapore, which hosts one of the biggest storage sites on the planet, has no official count either. “Thomson Reuters and others offer estimates based on the reported level of a vessel’s waterline,” reported the Wall Street Journal in July, “yet a number of ships are likely carrying fuel oil, a refined product used in shipping … [and] others may be carrying seawater, further complicating estimates.”
While the International Energy Agency claims there are 95 million barrels of oil in “floating storage,” the countries storing that oil don’t report how much of that they’re responsible for.
Western Canada holds about 60 million barrels of oil in storage, most of that sitting in Edmonton and Hardisty. A third of that capacity has been added in the last few years. Expect more to come. In fact, oil storage has been one bright spot in an otherwise bitumen-black downturn: in early 2015, Gibson Energy announced it would add almost one million barrels of capacity to its tanks in Hardisty, and Kinder Morgan, in partnership with Keyera Energy, announced a combined 4.8-million-barrel storage expansion, with the possibility of increasing that to 6.6 million. The storage boom isn’t just bolstered by production levels, though: the fewer pipelines there are, the more storage is needed – and it’s safe to say most of the industry would prefer a pipeline over storage.