Texas Oil Pipes Are Running All-Out on War-Driven Demand

​A gas flare at an oil refinery in Baytown, Texas. (Antranik Tavitian/Bloomberg)

Texas oil pipelines are running above designed capacity in some cases amid rampant overseas demand for U.S. crude to replace cargoes stranded by the Iran war.

Pipeline flows from the Permian Basin to Gulf Coast export terminals have climbed to an all-time high, according to research firm Wood Mackenzie Ltd. 

Last week alone, the volume of crude pumped through those networks rose by 1.5% to a daily average of 5.27 million barrels, Wood Mackenzie figures showed. On one system that feeds oil to Corpus Christi exporters, the pipes have been running at 102% of nameplate capacity, an indication that shippers are pushing the bounds to deliver as much oil as possible.

“With strong export demand being one of the main drivers, Corpus Christi-bound flows have unsurprisingly been exceptionally strong,” said Lee Williams, a senior research analyst at Wood Mackenzie. 

One knock-on effect of the surge in foreign demand has been a draw-down on domestic crude stockpiles.

The amount of oil held in storage at the key U.S. hub in Cushing, Okla., shrank by 1.7 million barrels in the most recent government data, the steepest drop since the start of 2025. 

U.S. exports of crude and refined products such as gasoline have never been higher, and along the Gulf Coast, outbound shipments of oil are set to touch a new record in May. 

The unprecedented foreign pull on U.S. supplies could start to pinch the homegrown energy landscape as domestic fuelmakers increasingly find themselves competing with overseas refiners for barrels. 

For consumers, such a supply scenario couldn’t come at a worse time, given the imminent approach of the summer driving season. 

Oil “flows along all major longhaul systems are essentially full,” Williams said.