...For this reason, heavy, sour oil tends to be cheaper than light, sweet....
Not All Alike
Production of key heavy grades is in decline, while most of the growth is very light crude from shale
...Off the coast of West Africa, steep decline rates at deepwater fields are cutting into the flow of heavy and medium grades from Angola, where a lack of investment has slowed the development of new fields to replace the losses.
...The shortage of heavy crudes is already having a market impact. A useful way to see this is to compare what Saudi Arabia charges buyers of its Arabian Heavy grade to prices for its Arabian Extra Light. The chart above shows how the gap has narrowed. Expect that trend to continue if heavy crudes become even more scarce and an ever-greater proportion of the supply is locked into domestic refineries or long-term supply deals with Asian partners. Too bad for the refiners who have made all the expensive investment to prepare for a heavy-crude world.
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