Transportation & storage costs are one of the key elements in pricing energy.
There is the cost of storage, in the US best highlighted by the Cushing Oklahoma Hub of the WTI Futures contract.
There is transportation to and from storage via ship,rail, truck or pipeline
Oil and gas movements by sea account for around a third of seatrade by weight. Tankers are required to move crude oil, refined oil products and gas. Crude oil is moved from the Middle East, the North Sea, West Africa and South America to refineries in Asia, Europe and USA.- Baltic Exchange
On a global scale shipping costs as measured by indicators such as the Baltic Dry Index $BDI the main sea freight index, tracking rates for ships carrying dry bulk commodities. It gives indications of demand and supply. Note the accompanying $BDI chart with the oil fall since 2013.
Other shipping indices we watch Panamax Supramax, Handysize, Capesize
Inventory levels for natural gas along with weather is the single cause of volatility in price. Storage is also important to basis markets and flows thereto.
Transport costs differ on different pipelines or basis points and are key to pricing and arbs.
Supertankers - Transport & Storage
Transporting oil & storage of surplus crude has become more critical as prices plummeted particularly as traders utilized contango elemnts of pricing.
Baltic Dry Index - Canary in a Coalmine
The Baltic Dry Index (BDI) is compiled by the Baltic Exchange in London for the price of shipping large bulk dry cargo such as coal, grain and iron ore. The index is based on a daily survey of agents all over the world. Baltic Dry hit a high on May 20, 2008 at 11,793 prior to the GFC bubble. The all time low was on February, 10 2016 at 290 points.
While there are other measures specifically for oil tankers and containers BDI is seen as the 'canary in the coalmine' of global trade. You can see from the accompanying charts the relationship to oil. The BDI is an index for price not volume, giving us an indication of demand and supply interplay. This was particularly useful for crude as it filtered price distortion from ETFs, investment bank created paper and geopolitical premia. It forewarned the oversupply of ships, product and a demand crunch