You may think the answer to this question is the cost or where the oil was extracted. But, the density and sulfur content of crude oil are two of the biggest factors that determine its quality. Some locations produce higher-quality crude oils, which will sell for a higher price.
How do sulfur content and density affect quality?
The higher the sulfur content and the heavier the density, the lower quality the crude oil. A lighter density oil with low sulfur content (like West Texas Intermediate (WTI) from Texas) is the highest quality, which means it sells for more money. Prices can vary significantly based on quality differences.
The industry uses the terms “sweet” and “sour” to describe the amount of sulfur in crude oil. These food-related terms describe high-quality types as sweet and lower quality as sour. When prospectors were first opening wells to produce, they would taste the commodity to see if it was sweet or bitter or rotten. Higher-sulfur crude oil is cheaper for a few reasons.
- This type of crude oil is known for producing larger amounts of toxic emissions than others.
- High-sulfur crude can damage refinery equipment because it has a higher rate of oxidation and corrosion. If a refinery is not equipped to handle sour crude oil, they could end up spending too much on maintenance and repairs.
- Crude oil with a higher sulfur content has fewer hydrocarbons. These components are what allow for the combustion of fuel within an engine. This means that a lower-quality fuel will be less efficient.
This is measured using API (American Petroleum Institute) gravity. The four categories of density for crude oil are light, medium, heavy, and extra heavy. The heavier (denser) the product, the lower quality it is because it cannot produce the best gas and diesel.
Why should refineries choose the highest-quality crude oil?
If producers are able to sell cheaper oil that works, why would a refinery want to pay higher prices? The answer is efficiency, both for cost and production. Diesel and gasoline are more easily produced with better quality oil and can sell at higher prices. It also causes less damage to equipment, which reduces maintenance costs.
Do you need wholesale fuel?
If you are looking for high-quality wholesale fuel Products and Services, Kendrick Oil Company can help. You can reach us at (800) 299-3991 to learn more about us. We serve clients throughout Texas, New Mexico, Oklahoma, Kansas, Colorado, and Louisiana.