U.S. oil production has increased to the point that existing pipeline capacity can't handle the additional volume. The U.S. Energy Department this week said domestic oil production reached an average 7.6 million bpd in August, the highest for any month since 1989.
The Association of American Railroads said Thursday petroleum and petroleum products were delivered by 11,950 carloads, representing approximately 8.3 million barrels, for the week ending Sept. 7. That's a 4.8 percent increase from the same time last year.
Total U.S. rail traffic for the week, which included the Labor Day holiday, was 507,493, an increase of 4.2 percent year-on-year. Motor vehicles and parts led the week with a 21.9 percent increase from the same time last year.
For petroleum and petroleum products, AAR reported average weekly rail traffic so far this year at 13,488 carloads, a 39.3 percent increase from 2012.
In June, the energy department said the average daily rail delivery of 700,000 bpd represents about 10 percent of the total U.S. crude oil production.
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