198 PETROLEUM TECHNOLOGY, ECONOMICS, AND POLITICS
of oil possible, and they are low cost, efficient, and extremely flexible, but on the other hand, a pipeline is the method of choice for
transcontinental movement of crude oil.
With respect to tankers, each route usually has one size that is
economic appropriate and is based on the following factors:
1. Voyage length
2. Port constraints
3. Canal constraints
4. Volume.
For example, crude oil exports from the Middle East (involving high volumes and long distances) are carried mainly by very
large crude carriers (VLCCs), which typically carry more than two
million barrels of oil on every voyage. The economies of scale of
the very large crude carriers outweigh the constraints imposed by
size differences and a long voyage is often cheaper than a short
voyage when the cost is compared on a on a per barrel basis.
The very large crude carriers are too large for all the ports in the
United States except the Louisiana Offshore Oil Port (LOOP) and
must have some or all of their cargo transferred to smaller vessels
either at sea (lightering) or at an offshore port (transshipment). In
contrast, ships out of the Caribbean and South America are routinely smaller and can enter ports in the United States without the
need for offshore unloading of the crude oil.
On the other hand, pipelines are critical for transportation of
landlocked crude oil and also complement tankers at certain key
locations by relieving bottlenecks or providing shortcuts. In fact,
the only inter-regional trade that currently relies solely on pipelines
is crude from Russia to Europe. Export pipelines are also needed
for production from the Caspian Sea region but the greatest negative for pipelines crossing national boundaries is the vulnerability
of the pipeline to political and terrorist acts. However, pipelines
are the primary option for transcontinental transportation because
they are at least an order of magnitude cheaper than any alternative such as rail, barge, or road. In such cases, pipeline vulnerability
is usually small or non-existent within national borders (such as
the United States and Canada). In fact, the development of large
diameter pipelines during World War II allowed the development
of the vast pipeline network in North America that moves crude oil
of oil possible, and they are low cost, efficient, and extremely flexible, but on the other hand, a pipeline is the method of choice for
transcontinental movement of crude oil.
With respect to tankers, each route usually has one size that is
economic appropriate and is based on the following factors:
1. Voyage length
2. Port constraints
3. Canal constraints
4. Volume.
For example, crude oil exports from the Middle East (involving high volumes and long distances) are carried mainly by very
large crude carriers (VLCCs), which typically carry more than two
million barrels of oil on every voyage. The economies of scale of
the very large crude carriers outweigh the constraints imposed by
size differences and a long voyage is often cheaper than a short
voyage when the cost is compared on a on a per barrel basis.
The very large crude carriers are too large for all the ports in the
United States except the Louisiana Offshore Oil Port (LOOP) and
must have some or all of their cargo transferred to smaller vessels
either at sea (lightering) or at an offshore port (transshipment). In
contrast, ships out of the Caribbean and South America are routinely smaller and can enter ports in the United States without the
need for offshore unloading of the crude oil.
On the other hand, pipelines are critical for transportation of
landlocked crude oil and also complement tankers at certain key
locations by relieving bottlenecks or providing shortcuts. In fact,
the only inter-regional trade that currently relies solely on pipelines
is crude from Russia to Europe. Export pipelines are also needed
for production from the Caspian Sea region but the greatest negative for pipelines crossing national boundaries is the vulnerability
of the pipeline to political and terrorist acts. However, pipelines
are the primary option for transcontinental transportation because
they are at least an order of magnitude cheaper than any alternative such as rail, barge, or road. In such cases, pipeline vulnerability
is usually small or non-existent within national borders (such as
the United States and Canada). In fact, the development of large
diameter pipelines during World War II allowed the development
of the vast pipeline network in North America that moves crude oil