Blame it on the Permian Basin. Or just blame it on ourselves, since both of the success and demise of oil are in our hands.
In the current state of the oil and gas industry, the Bakken in North Dakota is producing an awesome 1.1 million barrels a day. TheEagle Ford region is producing a whopping 1.5 million barrels a day. But the Permian upstages them all, and is producing an amazing 1.7 million barrels: which could double in the next two years.
That's right. Jim Cramer said it could double.
Magellan Midstream Partners CEO Mike Mears spoke with the "Mad Money" host on Thursday to give additional color about just how realistic this claim could be. Magellan Midstream runs the pipelines out of the Permian and is an authority on the matter. Mears confirmed that they are seeing the numbers jump every day, and that he can't rule this theory out.
Mears says that right now the country has enough storage for the oil that is being produced, but if the levels continue to jump we will not have the proper storage or refining capacity to handle the oil.
Concerned, Cramer thinks the decline in oil price is a very big issue for the economy.