Oklahoma, as we’ve reported, both benefits and suffers from an uneven crude oil market.
The price of West Texas Intermediate — priced at Cushing — is depressed, which is bad for the region’s producers and state revenue coffers. But low crude prices might be a good thing for drivers in Oklahoma and the mid-continent, who fill up with cheaper gasoline than the rest of the country.
Producers are betting big on new pipelines to relieve a glut in Cushing and raise the price of West Texas Intermediate.
“That’s the concern here. Is that by removing the glut in supply that you will cause oil prices to go up which will likely impact motorists,” Patrick Dahaan, an analyst for GasBuddy.Com,” tells StateImpact Texas’ Mose Buchele.
Phillip Verleger of energy consulting firm PK Verleger tells Buchele that TransCanada’s Keystone XL pipeline would mean consumers in “Illinois, Minnesota, probably Iowa Nebraska, possibly Missouri and possibly the Dakotas paying more.”
TransCanada, of course, disagrees with Dahaan and Verleger. The company’s Jim Prescott backed up his argument with a Department of Energy memo he forwarded to StateImpact Texas:
“It says in the summary and conclusion that these pipeline projects would not increase gasoline prices to Midwestern consumers. That’s the last line in the report,” he paraphrased.