- Canadian Pacific Railway (CP -0.8%) is watching shipments of crude by rail which are now “coming alive a little bit,” Chief Marketing Officer John Brooks tells a Toronto transportation conference.
- Many traders are expecting a pickup in crude by rail volumes as oil sands projects including Suncor Energy's Fort Hills plant and the latest phase of Canadian Natural Resources' Horizon oil sands start producing at the end of this year.
- But Canadian rail execs have been cautious about crude-by-rail demand after they were forced to cut rates for shipping crude in 2015 due to the rout in global oil prices.
- "With new production expected to come on line in the next year … we are about to reach the limits of current pipeline infrastructure. This will likely result in a need to turn to rail as a stopgap to allow the new crude production to reach refineries," according to analysts at the Turner Mason consulting firm.
- Now read: Canadian Rails - Strong Moat For A High Price
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