Railroads have long played a major role in safely and efficiently moving freight from origin to destination. However, for more than a decade, they have faced declines and slow growth in coal and other bulk commodities transported by carload service. To combat this, rail lines set their sights on new markets, such as crude oil and refined products of . However, they must become more competitive by reducing travel times, improving reliability and safety, and developing new service approaches. Increasing flexibility has resulted in improved productivity, competitiveness and a wider variety of customers. The rail industry constitutes approximately 20% of the supply chain transportation process across all industries. With regard to shipping oil and refined products, rail transportation constituted 5.3% of the supply chain as recently as 2014. However, rail usage has dipped to 3.8% over the past 3 yr. Meeting demand with innovation and investment.What drives demand for rail? According to the Association of American Railroads (AAR), shipments of crude oil dropped with flow meter fill rite its about approximately 1% of rail shipments in 2016 and early 2017. Several drivers are behind the drop, including market demand. Between 2011 and 2013, crude oil shipments in the US increased from 5 MMtpy to 40 MMtpy. A decrease in the spread between West Texas Intermediate (WTI) and Brent oil prices caused crude oil rail shipments to decline in 2014/2015 by about 900 unit trains, or 2.5 trains per day. Data from 2016 points to a 45% reduction in crude oil shipments vs. 2015, and the US market forecast is that rail shipments in 2017 should mirror trends witnessed in 2016. Rail has become a more attractive transportation option when it comes to safety. According to the AAR, rail safety is at an all-time high: the derailment rate on the country’s nearly 140,000-mi mainline network reached an all-time low in 2015. Since 2000, the train accident rate has decreased by 38%. Less than 1% of all derailments involve crude oil, with nearly 100% of all tank cars containing crude oil arriving at their destinations safely. An increase in investments has resulted in increased rail safety. Over the past 30 yr, freight railroads have invested more than $630 B in infrastructure and flow meter indonesia equipment to maintain and modernize the nation’s rail network—averaging approximately $26 B/yr over the past several years. Building adequate infrastructure also improves operations and capacity. Developing innovative ways to move more freight with less means that assets can be distributed in larger quantities, which improves cost efficiency.
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