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Pipelines Ask U.S. Oil Drillers to Curb Output as Tanks Fill Up

  • Plains All American sent letter asking suppliers to scale back
  • ‘We need to get in front of this,’ Texas oil regulator tweets
Pipelines run near oil storage tanks in Cushing, Oklahoma.Photographer: Daniel Acker/Bloomberg
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American pipeline operators have begun asking oil producers to voluntarily ratchet back their output in the clearest sign yet that a growing glut of crude is overwhelming storage capacity.

Plains All American Pipeline LP, one of the biggest shippers of crude in the U.S., sent a letter this week asking its suppliers to scale back production. The notice came from the company’s marketing unit that buys and sells oil to customers. A Texas oil regulator said Saturday that drillers were getting similar notices from pipeline operators.