Thanks for the great explanation. I have tried in my own inept way to differentiate between Light Sweet and Heavy Sour grades for friends and family, and get met with blank stares. I will get them to read your version.

I do have a couple of questions.

Crude gatherers, in Oklahoma and Texas at least, buy different grades and blend them to 40 gravity, or more specifically in the 36.5 to 40.5 gravity, to minimize the penalty when they do a pipeline tender. In effect, they are blending condensate (for the most part) and heavy crude. Have you ever had any experience with this at the refining end, and what does this do to the refining process and to the assay? Is this specific to the final blended crude or is there a general result of about the same as the sample assay you show for Light Sweet?

As we import more finished product, would you anticipate asphalt becoming proportionately more expensive than other refinery products, or has this already happened?

Chuck

Have you ever had any experience with this at the refining end, and what does this do to the refining process and to the assay? Is this specific to the final blended crude or is there a general result of about the same as the sample assay you show for Light Sweet?

Two comments on this one. Yes, I have experience with some Canadian blends that they mix together from several fields to meet a gravity spec. The good thing about that is that you get a pretty consistent crude. This is one thing that makes operating a refinery more difficult - when you crude quality is swinging.

But, there are multiple ways to get to a certain gravity, as you indicate. And I have seen some of those middle cuts essentially missing. In that case, you know they did something like mix up condensate with very heavy stuff.

As we import more finished product, would you anticipate asphalt becoming proportionately more expensive than other refinery products, or has this already happened?

I don't know if it has been rising at the same rate, but asphalt prices have run up with crude oil. But what makes asphalt at risk of rising disproportionately is the fact that refiners are installing cokers, and taking asphalt off the market and turning it into gasoline.