President Obama will not approve the Keystone Pipeline. He says it’s not safe because Canadian Sand Crude oil is corrosive and could create pipeline leaks to environmentally sensitive areas in Nebraska. That’s possible in a hundred years or so. The aging pipeline system seldom leaks despite some being in the ground over a hundred years. Some of which have been carrying that Canadian crude to US refineries for years.
The real reason is not pipeline leaks, it’s environmental groups who don’t approve of tar sand extraction. No matter that it’s in Canada. In one of her first missions as Secretary of State, Hillary Clinton traveled to Canada to tell them to stop the process. That went well, since Canada was enjoying a healthy economy while Obama was busy blaming Bush for sinking our economy. Canada was smart enough to understand how important their oil was to their economic growth. Obama never will, even though fracking is saving his bacon here at home.
So, whether you believe Obama cut a deal with Warren Buffet, or not, Buffet’s Railroad, Burlington, carries crude oil to US refineries that would be carried by a Keystone Pipelines. Oil industry experts have warned that it’s far safer to move crude by pipe than by rail. Common sense is all that’s needed for that judgment.
It happened. Several rail cars carrying crude from Canada to Maine derailed on the Canadian side of the border. The explosion wiped out most of the town. As I’m writing this casualties are yet unknown. At least one is dead with 60 missing.
Will the media connect these dots for you? Probably not. Media in the US, with few exceptions, does not like pipelines.They will dwell on the plane crash in San Francisco and put the crude oil explosion on the back page.
Environmentalists contribute to Obama. Buffet helps Obama with the “tax the rich” election campaign. Obama halts the pipeline. Canada is upset with us, and begins planning a pipeline to their west coast to ship the oil to China. Buffet makes more money by hauling the oil to the US by rail.
It’s a matter of time before Buffet’s rail cars cause a disaster in some town in the United States. But, it’s all worth it. It’s about politics, not safety, jobs, common sense, working with our Canadian neighbor, or reducing U.S. dependence on Middle East crude. It’s campaign money in Obama’s pocket, votes, and money in Buffet’s pocket for his support.
That’s how our president set’s his priorities.
Here are some statistics from 24/7 Wall Street to show I’m not blowing smoke.
In its weekly report issued yesterday, the Association of American Railroads (AAR) noted that rail carloads of petroleum rose 50.8% in the week, compared to the same week a year ago. For the year to date, U.S. railroads have hauled 54.1% more petroleum than they did a year ago.
The numbers are truly impressive. The AAR counted 259,141 petroleum carloads last week. Just over a year ago, the count was just shy of 120,000 carloads for the comparable week. And that represented a rise of nearly 30% from the same week in 2011. Rail transportation of crude oil and petroleum products has nearly tripled in three years.
Coal shipments by rail still outnumber petroleum shipments by about eight to one, but coal carloads are down 5.6% year-to-date, compared with last year. And the number of carloads of grain has fallen 16% in the same period.
Among the railroads, the big winner is the Burlington Northern Santa Fe (BNSF), which is owned by Warren Buffett’s Berkshire Hathaway Inc. (NYSE: BRK-A) and plies the rails along the northern tier, including the oil-producing states of North Dakota and Montana. Railroads that depend more heavily on coal shipments, like CSX Corp. (NYSE: CSX), Norfolk Southern Corp. (NYSE: NSC) and Union Pacific Corp. (NYSE: UNP), have all experienced double-digit percentage drops in coal ships, weighing on revenues and profits.
Paul Ausick
Read more: Rail Cars Fill Up with Crude Oil, While Grain and Coal Shipments Remain Soft – 24/7 Wall St. http://247wallst.com/commodities-metals/2013/05/17/rail-cars-fill-up-with-crude-oil-while-grain-and-coal-shipments-remain-soft/#ixzz2YY06QTIS
