Crude-by-Rail Shipments Take Off as Pipelines Back Up

The amount of crude oil hauled in U.S. freight trains more than tripled last year, as production from shale formations surged.

The Association of American Railroads says US freight trains hauled nearly 234,000 carloads of crude oil in 2012.  That's up from less than 66,000 carloads the previous year.

The railroads have been an increasingly attractive option for oil producers because pipelines haven't been able to keep up with production.  Raquel Espinoza-Williams is a spokesperson for Union Pacific in Houston.

"Union Pacific has experienced significant growth, especially here in Texas, as we support the Eagle Ford and the Permian Basin shale plays. We've basically been able to open up yards that were dormant after the recession and bring employees back from furlough."

While crude-by-rail shipments been growing significantly in recent years, they still represent less than 1% of all the carloads railroads haul. Each railroad tank car holds about 700 barrels of oil.

Bio photo of Andrew Schneider

Andrew Schneider

Business Reporter

Andrew Schneider joined KUHF in January 2011, after more than a decade as a print reporter for The Kiplinger Letter...