Sweet and Sour, Light and Heavy Oil

Not all oil is created equal. The best stuff is sweet and light, easier
to refine and obtain more gasoline. The heavy stuff gives more fuel oil
and the sour stuff has larger amounts of sulfur. Here is an article
from Reuters that says that the Saudi's are indeed pumping more oil, but
it is not the good stuff that most nations want.

http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=5800501

Here are the first 6 paragraphs:

LONDON (Reuters) - Saudi Arabia's oil pumping spree is finally bringing
down prices on international crude markets -- but only for the dense,
low-quality grades that have little impact on benchmark futures prices
in
London and New York.

A surge in Saudi production since June has pushed prices for its Arab
Heavy
crude and other similar grades to deep discounts against the
higher-quality
light crudes that are at historic highs on U.S. and European markets.

"We are moving toward an oversupply of crude, but it's an oversupply of
heavy crude," said one senior oil trader at a major company. "The only
thing a seller can do now is discount them more and more."

Oil markets are more split than ever between prized light crudes rich in
gasoline and distillates, and bottom-of-the-barrel heavy grades, which
are
more complex to refine and produce lots of low-value fuel oil.

Heavy supplies have swollen as top world oil exporter Saudi Arabia
raises
production toward 9.5 million barrels per day -- cutting its spare
capacity
cushion to just one million bpd -- in a bid to cool world prices.

The kingdom has promised to supply customers with all the crude they
want.
The trouble is that Saudi Arabia is already pumping as much as it can of
the light, gasoline-rich crude that refiners crave.
Received on Thu Jul 29 21:18:32 2004