by Richard Peterson
For some time we have asked, “why is Alaska North Slope (ANS) crude oil selling for such a high price”. This article from Northrim Bank lays it out and while Alaskans have been basking in the $40/bbl premium soon Canadian producers will break out and reach the West Coast. We have been aware of a proposal to rail Canadian crude to Delta to ship in TAPS to Valdez. It doesn’t make economic sense unless you look at the differential. At $40/bbl even $20/bbl you can do strange things. We are aware of Bakken producers railing crude to the East and West Coasts. One just ordered 1200 new tank cars and will soon be flooding the West Coast with much cheaper oil.
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