Cushing, Oklahoma, is a town of about 7,000 close to where we live. What makes it notable is that several oil pipelines cross there. Which has led to the construction of massive oil storage facilities where production companies can park their oil until it’s needed.
The big OPEC producers, led by Saudi Arabia, have made a deal with non-OPEC producers, such as Russia, to cut back production in an attempt to drive up prices. But because Cushing has built up such a big supply, prices are staying low despite the cutback.
Bloomberg has a story about the global economic impact of this small town.
Now if Cushing and thus the world’s oil supply can only avoid damage from the earthquakes they’ve been having. On November 6, Cushing had a 5.3 magnitude quake that did some serious damage to the downtown, though the pipelines and storage tanks were spared. [Read more…]