A few locations produce higher-quality crude oil, which sells for higher prices.
You might think the answer to this question is the cost where oil is fully extracted. However, crude oil’s density and sulfur content are a few of the biggest factors determining its overall quality. A few locations produce higher-quality crude oil, which sells for higher prices. Read on to learn more about crude oil!
How Do Sulfur Density and Content Affect Quality?
The higher your sulfur content and the heavier its density is, the lower the quality of the crude oil. A lighter-density oil with low sulfur content is the highest type of quality, which means it sells for a lot more money. Prices can vary based on quality differences.
Sulfur Content with Crude Oil
The industry uses the terms sour and sweet to describe the amount of sulfur within crude oil. These food-related terms describe high-quality types of either sweet or lower-quality sour. Once prospectors were first opening wells to produce oil, they’d taste the commodity to see if it was rotten or sweet. Higher-sulfur crude oil is more cheap for a few different reasons.
- This type of crude oil is well-known for producing bigger amounts of toxic emissions than others.
- High-sulfur crude could damage refinery equipment since it has a higher rate of corrosion and oxidation. If a refinery isn’t equipped to handle sour crude oil, they might end up spending too much on maintenance and other repairs.
- Crude oil with a much higher sulfur content has much fewer hydrocarbons. These components are what helps allow for the combustion of fuel inside of an engine. This means that lower-quality fuel is less efficient.
Why Should You Choose High-Quality Crude Oil?
If producers are able to sell cheap oil that works, why would a refinery want to pay for higher prices? The answer is efficiency, both for production and cost. Gasoline and diesel are a lot more easily produced with better quality oil and can sell at high prices. It also does not cause as much damage on your equipment, which can save you on maintenance costs.
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