Oil pipeline shipping costs will rise slower than inflation for the next five years

The US energy regulator proposes to lower the cap on how much oil pipelines can raise their shipping rates each year. This means the cost of moving oil through pipelines will grow more slowly than the general price of goods for the next five years.

The Federal Energy Regulatory Commission sets the maximum price oil pipelines can charge to move crude oil and refined products. This cap is tied to an inflation index, but the regulator can adjust it. For the next five years, the regulator proposes to set this adjustment lower than the general inflation rate. This means pipeline operators will see their revenue growth constrained, which could affect their investment decisions in new capacity or maintenance.