Permian Oil Too Light

[Marina Schwarz + 1,576]

"Over the past year, production from the Permian in West Texas and New Mexico has changed, with more super-light oil being extracted, as producers focus drilling in the western part of the basin. As those volumes increase and heavy crude supplies shrink, refiners are grappling with the mismatch in the density of oil they require and what the country produces, traders said."

Here.

[Jan van Eck + 7,558]

I would mention to the readers that crude extracted in the Bakken Formation has been sent by railcar to various ports in the Pacific Northwest, where it has been loaded unrefined into ship's bunkers and burned "straight" in those big marine diesels.  Works just fine. 

How this plays out after IMO 2020 is anybody's guess. 

[Douglas Buckland + 6,308]

Jan,

What is the price differential 'all in' between diesel, bunker fuel and the Bakken crude?

[ceo_energemsier + 1,818]

2 hours ago, Marina Schwarz said:

"Over the past year, production from the Permian in West Texas and New Mexico has changed, with more super-light oil being extracted, as producers focus drilling in the western part of the basin. As those volumes increase and heavy crude supplies shrink, refiners are grappling with the mismatch in the density of oil they require and what the country produces, traders said."

Here.

There is a lot of investment being made along the USGC by refiners to be able to expand capacity and upgrade their refining equipment to handle the lighter crudes and condensates as well as billions and billions of $$$ in grassroots petchem plants that will use these as feedstocks.  It may take some time but it will get utilized and for exports as well. It will also serve very well as blending feedstocks for much heavier crudes. XOM alone is investing 20bil$ along the USGC to handle these coming out of the Permian and elsewhere along the USGC.

And I will take every barrel of these as well.