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| Home Front: Economy |
| Oil shortage or surplus? Ask shortage of what oil? |
| 2004-10-21 |
| Many refineries are not set up to process abundant heavy crude oil because it is more difficult, expensive to refine into products. OPEC producers insist there is no shortage of oil despite record prices and although plenty of heavy crude is available, refineries are thirsty for light sweet crude which is in shorter supply, analysts say. "To answer the question, is there a shortage of oil at the moment? We have to ask, a shortage of what oil?" said Bruce Evers, an oil industry analyst at Investec Securities. Many heavyweight producers such as Saudi Arabia, Venezuela, Kuwait and Iran produce large quantities of heavy, sour crude with a high sulphur content. Others such as Nigeria, the United Arab Emirates, Angola and Libya pump a higher quality, light sweet crude, with a lower sulphur content. "We still have a deficit of refinery capacity that's capable of processing heavy sour crude and we still have an absolute shortage in light sweet crude which is easy to refine," said Societe Generale analyst Deborah White. NOTE: Light, sweet, low-sulphur crude is most suitable for refining into petrol, gasoil and heating oil. |
| Posted by:Mark Espinola |
| #1 Funny, but I remember hearing years ago that S.A. produced light, sweet crude. Somebody's lying. |
| Posted by: Bomb-a-rama 2004-10-21 10:07:32 PM |