Crude Oil Handbook

Available in Both Print and Electronic Format!

International CrudeOil Market Handbook1997-98 Edition

PETROLEUM INTELLIGENCE WEEKLY��S

IInntteerrnnaattiioonnaall CCrruuddee OOiill MMaarrkkeett

HHaannddbbooookk1997-98

Second Edition

TThhoommaass WWaalllliinnIIrraa JJoosseepphh

Published by:

Production: Tim NuddJanuary 1997

Photocopying or reproduction in any form is prohibited. © 1997 PIW Publications and The Oil Daily Co.

PUBLISHER: Edward L. Morse. PRICE: $1,035, $825 for PIW and Oil Daily subscribers (add�l copies $465, $375)PIW: 575 Broadway, 4th Floor, New York, NY 10012. Tel.: (212) 941-5500; Fax: (212) 941-5509OIL DAILY: 1401 New York Ave., Suite 500, N.W., Washington, DC 20005. Tel. (202) 662-0700; Fax: (202) 662-0739

PIW PUBLICATIONS The Oil Daily Co.u

DDoo NNoott RReepprroodduucceeCopyright © 1997 PIW Publications and The Oil Daily Co. Unauthor-ized copying of PIW�s International Crude Oil Market Handbook isprohibited by US copyright law and international law. No part of thispublication may be reproduced, electronically transmitted (e.g. via faxor e-mail), or electronically stored in a database without the prior writ-ten permission of the publisher.

Additional copies of this book may be purchased at a discount.Please contact the Circulation Department at PIW�s New York office,(212) 941-5500, fax (212) 941-5509.

PETROLEUM INTELLIGENCE WEEKLY��S

IInntteerrnnaattiioonnaall CCrruuddee OOiill MMaarrkkeett

HHaannddbbooookk1997-98

Second Edition

TTaabbllee ooff CCoonntteennttss

OOvveerrvviieeww:: TThhee IInnnneerr WWoorrkkiinnggss OOff CCrruuddee OOiill MMaarrkkeettss

A. Introduction � Understanding Crude Oil Markets . . . . . . . . . . . . . . . . . . . .A1

B. The Spot Market � The Revolutionary Impact Of Spot Trading . . . . . . .B1

C. Term Sales � Constant Evolution Transforms Term Contracts . . . . . . .C1

D. Logistics � Tankers, Pipelines, And Stocks . . . . . . . . . . . . . . . . . . . . . . . . . .D1

E. Refining � What�s A Crude Oil Worth? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E1

Glossary Of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E15

RReeffeerreennccee SSeeccttiioonn:: PPrrooffiilleess,, TTrraaddee,, AAnndd PPrriicceess

F. Country Profiles � How Countries Market Their Crude Oil . . . . . . . . . . . .F1

G. Term Contracts And Trade Flows By Country And Company . . . . . . . .G1

H. Crude Oil Profiles � A View Of the Market Through Each Grade . . . . .H1

I. Prices � Spot And Term Contract Prices For Key Grades . . . . . . . . . . . .I1

TThhee IInnnneerr WWoorrkkiinnggssOOff CCrruuddee OOiill MMaarrkkeettss


A. Introduction � Understanding Crude Oil Markets . . . . . . . . . . . . . . . . . .A1

B. The Spot Market � The Revolutionary Impact Of Spot Trading . . . . . . . .B1

A Spot Market �Daisy Chain� . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B2

Benchmark Crude Oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B6

Brent: The International Benchmark . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B9

West Texas Intermediate: Improbable Price Leader . . . . . . . . . . . . . . .B15

Dubai: A Benchmark In Limbo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B19

Spot, Forward, And Futures Markets For Key World Grades In 1996 . . .B28

C. Term Sales � Constant Evolution Transforms Term Contracts . . . . . . . .C1

An Example Of How A Formula Price Is Determined . . . . . . . . . . . . . . . .C8

Dependence Of Term Contracts On Spot Benchmarks . . . . . . . . . . . . .C11

D. Logistics � Tankers, Pipelines, And Stocks . . . . . . . . . . . . . . . . . . . . . .D1

Tankers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D1

Pipelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D6

Shipping Distances And Times For Key Tanker Routes . . . . . . . . . . . . . .D7

Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D12

Major Pipeline Links In World Crude Oil Trade . . . . . . . . . . . . . . . . . . .D13

E. Refining � What�s A Crude Oil Worth? . . . . . . . . . . . . . . . . . . . . . . . . . .E1

An Overall Look At The Refining Process . . . . . . . . . . . . . . . . . . . . . . . .E2

Calculating A Netback . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E5

PIW Pacesetter Crude Oil Yields . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E7-8

Types Of Crude Oils And Their Characteristics . . . . . . . . . . . . . . . . . . . .E9

Gasoline And Naphtha . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E11

Kerosine, Gas Oil, And Residue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E12

Glossary Of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E15

CRUDE OIL HANDBOOK PIW © A1

IINNTTRROODDUUCCTTIIOONN ��

UUnnddeerrssttaannddiinngg CCrruuddee OOiill MMaarrkkeettss

This second edition of PIW�s International Crude Oil Market Handbook builds

on the success and strengths of the first volume, which was published in 1994.

The basic purpose of the book remains the same: to provide a comprehensive

picture of international oil markets in all of their broad scope and complexity.

This new edition completely updates the original version and adds a number of

valuable new features. The entire book has been fully revised to reflect a vast array ofchanges, both large and small, that have occurred in the world�s constantly evolvingcrude oil markets over the last two years. With rising non-Opec production, a numberof new crude oil streams are appearing on the market. Among the new features of thehandbook are profiles of over 20 of these crude oils, bringing the total to 134 individualstreams. And there are completely new assays for more than 60 of these. The price dataand information on term-contract volumes and trade flows have also been updated andexpanded, providing a more robust reference section.

Despite the many enhancements, this second edition of the handbook has

much the same structure as its predecessor and provides valuable information

for both the experienced oil trader and the newcomer to crude oil markets. Thefirst section of the book, The Inner Workings Of Crude Oil Markets, provides a brief butthorough analysis of the main features of these markets. By taking a comprehensive viewand bringing together a wealth of data and information from a wide array of unique andhard-to-access sources, this section provides important insights for experienced analystsas well as a valuable introduction to the subject. The second section of the book isdesigned exclusively for reference purposes, providing profiles of both the current mar-keting strategies of individual countries and basic data and characteristics on 134 crudeoil streams. All of this is supplemented by extensive data on prices and trade flows, muchof which are unique to PIW and its sister publications.

Crude Oil: A Special Commodity

The size, scope, and complexity of global crude oil trade are unique among phys-

ical commodities. With more than $400-billion a year in physical transactions,

encompassing scores of different crude oil grades going to hundreds of refineries

all over the world, it overshadows other physical commodity markets. Beyond its

sheer scale, worldwide crude oil trade in the last 25 years has gone through revo-

lutionary changes that have had broad political and economic impact, adding to

its uniqueness. The strategic importance of petroleum, the crucial role that it plays in theeconomies of both importing and exporting countries, and the heavy reliance on it,despite efforts to diversify sources of energy, also magnify the critical significance of glob-al commerce in crude oil. Despite the evolution of oil trade toward free-market structuresin most parts of the world over the last 10 to 20 years, it seems improbable that crude oilwill become a commodity like any other. Although it has taken on many of the trappingsof other markets, crude oil is likely to remain in a league of its own due to its inherentcomplexity and the political and macroeconomic importance that it bears.

A2 PIW © CRUDE OIL HANDBOOK

The transformation from the stable, controlled supply systems of the inter-

national majors in the 1960s to the volatile, freewheeling markets of the mid-

1990s underscores another crucial aspect of today�s crude oil trade: its

dynamism. Not only are prices volatile, but virtually all aspects of the global

crude oil market have been in a constant process of transformation. This com-

merce is in many ways almost unrecognizably different from what it was just 15

years ago. The participants have grown much more diverse, traditional supply

links have disintegrated or been transformed, and the pressure of competition

has grown relentlessly. Even up until the late 1970s, the international crude oil mar-ket was considered to be a comfortable club with membership drawn mainly from theranks of major oil companies and heavily dominated by them. With the growth of pricevolatility, the surge in non-Opec supply sources, the rising importance of national oilcompanies, the breakup of the Soviet Union, and a host of other changes, the commercein crude oil has become more diverse, complex, and competitive. Change is now a con-stant. One important and visible measure of this dynamism lies in the growth of futuresmarkets and other instruments for handling price risk.

In contrast to the state of flux that has now become the norm for crude oil

markets, the physical characteristics of crude oil have always conspired to create

a special degree of complexity that makes it unusual among commodities. Each

crude oil from each field is unique in quality, and significant variations can even

occur in the quality of a single field�s output over time. This means that individ-

ual crude oils can present special challenges in handling and refining and, there-

fore, in their valuations in the marketplace. While all crude oils are capable of pro-ducing similar end products, the crude oils themselves are far from interchangeable andmust be treated individually. The specific characteristics of different types of crude oilmust be taken into account in order for refiners to realize the full advantage of their spe-cial qualities. This operational constraint has led to the tailoring of refineries and trans-portation and storage systems to cope with particular grades.

Upstream Meets Downstream

For the oil industry, crude oil trade represents the key nexus between the two

main centers of activity: upstream exploration and production, and downstream

refining and marketing. Not only does it determine the value of upstream output,

but it also defines the cost of the main downstream feedstocks. Operational deci-sions about combining output from various fields to create a specific crude oil exportstream with certain characteristics are constantly tested in the market against refiners�requirements for specific feedstocks to meet final demand for a changing combinationof products. Due to the extensive vertical integration of the oil industry until the early1970s, these decisions were largely kept under the umbrella of major oil companies.Under the current free-market system, the performance of the crude oil market provideskey signals for basic operational decisions throughout the industry.

Despite the radical changes in oil trade, an underlying constant has prevailed

in the way that a crude oil�s value is determined. Crude oil itself has almost no

direct end uses. A barrel of crude oil from a single stream has value to a refiner

only in terms of the products that it can yield. Ever since the simplest distillation unitswere invented more than a century ago to refine oil and produce illuminating kerosine, ithas been the value of the end products that ultimately determines a crude oil�s value. Each

CRUDE OIL HANDBOOK PIW © A3

unique stream of crude oil generates different combinations of final products, all of whichcompete in independent markets. The value of the crude oil is therefore derived from thecombined value of these co-products, which range from the lightest liquid petroleumgases and sophisticated gasolines to the heaviest fuel oils for ships and industrial boilers.

The price of crude oil emerges from a complex interaction between the signals

provided by product markets through the purchasing decisions of refiners, and

the varying revenue objectives of producers. This process has rarely been purely

economic, and it has had political overtones for most of this century because of

oil�s strategic importance. While Opec is currently the most visible expression of thispolitical dimension to crude oil prices, other countries and political groups within themhave strongly held stakes. Although most large industrial countries have adopted a pro-free-market stance, even these big consumers have clear concerns and preferences aboutthe level, direction, and volatility of oil prices as they affect their economies. The struc-ture of the markets and their importance as a source of tax revenue are also key politicalissues. Because of all of these political influences, oil markets do not single-handedlydetermine crude oil prices. Rather, they help to define the general level.

Spot Market Dominance

Perhaps the most important underlying trend in crude oil markets over the last

20 years has been the drive toward marginal pricing linked to spot barrels. In the

1960s and early 1970s, the spot market was a small trickle compared to the much

larger flows under term contracts in the integrated systems of major oil compa-

nies. Now the situation is totally reversed: The spot market calls the tune. This trans-formation, which is described in more detail in the following chapter, reflects a combina-tion of factors, including three price shocks: the explosions of 1973-74 and 1979-80, andthe collapse of 1985-86. With hindsight, the relentless pressure applied by the free marketseems to have been inevitably leading to some version of the spot-price-driven structurethat now exists despite the many political and institutional factors that stood in the way.

The reliance on the spot market has many obvious attractions for all market

participants, which is why it is predominant today. But the accompanying

volatility and the inherent competitive pressure in these markets to move toward

marginal pricing of incremental supplies � in which prices are set to equal the

additional cost of obtaining an extra unit of output � pose genuine perils for the

oil industry. It is not at all clear that spot prices reflect the long-term marginal costs offuture crude oil supplies, a relationship that economists generally consider to be a criti-cal prerequisite for the smooth operation of the industry. One of the basic contradictionsof the oil business that has existed virtually since its inception is that the high investmentcosts and long lead times of oil projects require higher prices than those implied by therelatively low short-term operating costs of existing fields. With Opec itself coming clos-er to its output capacity as oil companies minimize inventories, and with all parties, fromrefineries to drilling rigs, operating at much higher rates of utilization, the oil industry inthe mid-1990s shows some clear signs of moving into a period of greater upward pres-sure on spot prices.

Two Different Perspectives

This book describes the complexity of the global crude oil market from two

completely different perspectives � and in this sense, it is two books in one. The

A4 PIW © CRUDE OIL HANDBOOK

first section, The Inner Workings Of Crude Oil Markets, provides a description

and analysis of the many elements of the international crude oil trade, high-

lighting the themes mentioned above and others that trace its development and

current structure. The second section is essentially a reference book that has

proved an invaluable daily companion to oil market participants and analysts.

For over 130 individual crude oils, it furnishes all of the vital information that is neededby anyone involved in any way in the market. It also contains detailed profiles of themarketing strategies of the 36 main crude oil exporting countries and a wealth of priceand trade data. Similar books have been put together in the past by a few major inter-national oil companies for their own internal use, but these were never widely distrib-uted and most have been discontinued as companies have cut costs.

The next four chapters of the book, which make up the first section, can be

read either as a unified whole or randomly for reference purposes. They begin

with a basic description of the spot market and its origins before discussing the

key international benchmark grades that set the pace for virtually all crude oil

sales worldwide. This is followed by a description of the growing importance of thefutures market and then an analysis of the evolution of term-contract supply arrange-ments. The logistics of crude oil transportation by ship and pipeline are presented, alongwith detailed data on key routes and flows. The final chapter of the first section dealswith refining and crude oil valuation, serving as a transition to the descriptions of indi-vidual crude oil streams in the second section.

This handbook also contains numerous special features to keep up to date

with new developments and efficiently present the information. In order to sup-plement the annual data and information presented here, PIW will send out four or fiveupdates a year as they appear in our regular supplements on term crude oil prices (four)and term-contract sales (one). Any updates that have already been published can befound in the reference section.

The need to constantly update information on such matters as crude oil

streams and the individual marketing strategies of exporting countries means

that the entire book is intended to be revised regularly and extensively every two

years or so. The book has evolved rapidly into an independent source that is

widely relied upon for basic data and information on the international crude oil

trade. PIW is uniquely qualified to produce such a book, having tracked the crude oilmarket intensively from the origins of the spot market. PIW also brings to bear a world-wide information-gathering network that provides material known for its accuracy andrelevance to the business decisions and needs of the international oil industry. The edi-tors encourage an open dialogue with all users of this book and look forward to yourcomments and suggestions for incorporation into future editions.

CRUDE OIL HANDBOOK PIW © B1

TTHHEE SSPPOOTT MMAARRKKEETT ��

TThhee RReevvoolluuttiioonnaarryy IImmppaacctt OOff SSppoott TTrraaddiinngg

The growth of the international spot market in crude oil during the early 1980s

revolutionized the way that petroleum is priced and turned much of the industry

completely on its head. The ensuing transformation in the structure of oil mar-

kets forms the basis on which crude oil is priced internationally today. For near-

ly 15 years leading up to the mid-1980s, virtually all of the oil that changed hands

around the world was sold under relatively strict price mechanisms managed by

the governments of oil-exporting countries. That system � called, alternatively, oneof administered, government, or official selling prices � had an inherent logic that con-vinced most participants that the methodology was fairly permanent. Its main featureswere simple: Governments of most of the largest oil-producing areas of the world felt dur-ing that era of resource nationalism that the determination of oil prices was an expressionof national sovereignty. They, almost without exception, laid down the pricing basis,under which their oil was sold from their export terminals at an official price �free onboard� (f.o.b.) a vessel loading oil � a system that they had largely inherited from themajor oil companies. To be sure, they had to take into account market forces, adjustingprices to one another and referring to global demand and supply patterns in a systemdescribed below. But within those narrow bounds, the administration of oil prices by gov-ernments was a basic fact of crude oil markets.

In contrast to the complexity of today�s market, the hallmark of oil�s old

regime was simplicity, although its goal of stability remained elusive. There

weren�t all that many participants supplying the market under the system of offi-

cial selling prices. A handful of countries exported oil � 13 eventually in Opec and lessthan half a dozen of any consequence outside that producer group: Mexico, Norway, theUSSR, and the UK. Buying was dominated by the major international oil companies, withlimited involvement by independent refiners, traders, and other intermediaries.

As the spot market grew in prominence in the early 1980s, the radical change in

crude oil pricing that accompanied it was the emergence of a market discovery sys-

tem driven by marginal spot trading, which eventually replaced administered sell-

ing prices. The result is a system in which virtually all term-contract prices are tied

directly or indirectly to price quotes from the spot crude oil market. The ascendanceof spot market-based pricing, which is described in more detail below, was directly linkedto the abrupt emergence of surplus global production capacity in the early 1980s as demandplunged due to high prices. At that time, Opec countries abandoned administered prices intheir effort to compete with one another and with new market entrants in order to disposeof their production as the �sellers� market of the 1970s turned into the �buyers� market ofthe 1980s. Oil refiners and traders in turn pushed their suppliers to provide crude oil pricesthat would be profitable for them in terms of the current sales prices of refined products.

The Spot Market�s Key Role

The size of the international crude oil spot market is extremely difficult to

gauge, but its enormous influence and its significance for virtually all aspects of

B2 PIW © CRUDE OIL HANDBOOK

the oil business are unquestioned. While spot deals are estimated to account for

only about one in three sales of physical crude oil, the prices generated by these

transactions are now the primary determinant of almost all other world oil prices.

This is most apparent in the formula pricing systems now used for the bulk of term crudeoil sales by Opec producer countries. Formulas typically specify direct price linkages toparticular spot crude oil quotes. Spot prices are also closely tracked by countries and com-panies that sell crude oil on the basis of postings or retrospective pricing arrangements.In today�s market, crude oil sellers have little scope for deviating from the trends estab-lished by the spot market � which comprises the trading of individual cargoes or partialshipments for immediate delivery, outside of any continuing supply commitment.

Beyond their dominant role in international crude oil pricing, spot markets

have a significant impact on everything from an oil company�s share price to its

investment plans. The spot market and closely linked futures trading are also

used as the main barometers for measuring Opec�s success at balancing global

supply and demand. The stock-market values of oil companies that are heavily orient-ed toward the upstream sector have, since 1985-86, been closely linked to spot crude oilmarket trends, reflecting the vital importance of this single variable for some firms� cur-rent cash flows and capital budgets. While oil companies tend to gear their long-terminvestment plans to future price expectations rather than to current market levels, it is

AA SSppoott MMaarrkkeett �DDaaiissyy CChhaaiinn�

To illustrate the complexity of spot market transactions, a sample of an actual Brentcrude market deal from the mid-1980s, when the market was expanding rapidly, isshown below. The daisy chain of forward and spot market transactions linked togeth-er 24 companies in 36 deals over a period of a few months. The cargo finally loaded atSullom Voe in March 1984 and sailed to Sun�s refinery at Markus Hook, Pennsylvania.

BNOC

Charter

Phibro

BP

Acorn

Gatoil

Sun

Shell UK

Pegasus

Transworld

Phibro

Phibro

Pecten

Tricentrol

Idemitsu

Occidental

Acorn

Acorn

Transworld

Itochu

P&O Falco

Tricentrol

Acorn

Chevron

Texaco

Phibro

Bomar

Neste

Sun

Sohio

Shell Int�l

BP

Phibro

Transworld

Phibro

Bomar

Ultramar


also clear that spending plans are slowed or accelerated over the course of the yeardepending on the strength of current spot markets. That�s because they are used as ayardstick of a firm�s future cash flows, which are key determinants of capital investmentexpenditures.

One of the distinguishing characteristics of the physical crude oil spot mar-

kets since the early 1980s has been their extreme volatility. Wide swings in prices

have fostered the growth of large forward and futures markets and an array of

risk-management tools that are effectively an extension of the physical spot mar-

ket. The futures markets are dependent on the physical spot market in that they arelinked to them at the point of delivery, but the two are constantly responding to eachother and have grown mutually interlinked and dependent. The futures markets nowtrade oil volumes for future delivery that far overshadow the spot market. The New Yorkand London crude oil futures exchanges together trade the equivalent of more than 150-million barrels in each session, or more than double the volume of physical oil producedaround the world daily.

How Big Is The Spot Market?

While the spot market�s growth has been central to the transformation of

crude oil trade over the last 10-15 years, no precise measure exists for its size.

That�s because the number of companies involved in buying and selling the same

cargo of crude oil before it reaches its final destination can often be quite large.

One of the biggest problems is determining a particular point in the supply chain atwhich to measure the spot mar-ket. Cargoes of crude oil aresometimes resold in spot trade asthey move from the port of load-ing toward their final destination.In the case of forward crude oilmarkets such as those for NorthSea Brent or Mideast Dubaigrades, long �daisy chains� ofphysical transactions can resultin the same cargo passingthrough many hands (see box,opposite page). What�s more, themarket is not fully transparent,since physical spot market trans-actions are often confidentialand lack any central clearing-house.

Perhaps the best available

data on the size of the international spot crude oil market come from the US

Department of Energy, which receives regular mandated reports on transactions

from companies importing crude oil into the country. Spot crude oil in the mid-

1990s has accounted for about one-third of such volumes, which represents a

slight increase from the 30% of the late 1980s and early 1990s. These data can onlybe viewed as indicative of worldwide trends, but are probably fairly representative: The

0.0

0.5

1.0

1.5

2.0

2.5

1987 1989 1991 1993 1995

US SPOT CRUDE IMPORTS BY REGION

AfricaAsia

EuropeMideast

N. America

S. America

(In mill. b/d)

US SPOT CRUDE OILIMPORTS BY REGION


US is the largest crude oil importer in the world and draws on virtually all crude oil-pro-ducing regions to some extent. These US import data demonstrate that the market cangrow and shrink in size quite dramatically depending on market conditions and season-al factors. For example, spot transactions constituted over 35% of US imports in the sum-mer of 1986, when oil markets crashed to below $10 a barrel. By early 1988, they rep-resented less than 24% of US imports. But by 1995, spot volumes had climbed back upto 36%, exceeding their previous high point in 1986.

The US data indicate that the spot market has been growing in recent years,

both as a percentage of all transactions and in absolute terms. Much of this

growth appears to have come from the Americas and, to a lesser extent, Africa,

which seems to be the largest source of spot barrels to the US market (seegraph,pB3). In fact, some70% of US crude oil importsfrom Africa, or 900,000 bar-rels a day, were on a spotbasis in 1995. Crude oil ex-porters in the Americashave provided most of therecent growth in US importsand much of this oil seemsto be on a spot basis, par-ticularly from Venezuela.While the Mideast remainsan important crude oil sup-plier to the US, total salesare off and spot sales havedwindled to only about 15%of the total, as Saudi term-contract supplies increas-ingly dominate this trade. In contrast to the overall trend, spot sales have declined slight-ly from Europe as contract sales have increased.

Based on the US trends in spot trade described above, the total global spot mar-

ket would seem to amount to 9- to 10-million barrels a day of the over 28-million

b/d in world trade in 1995. This is based on a simple extrapolation of data from the BPStatistical Review, which would also suggest that Africa is the biggest spot market at 3-mil-lion b/d, the Mideast second at 2-million b/d, and Europe third at 1.5-million b/d.

Growth Of The Spot Market

The spot market became a dominant force in world oil trade only in the last 15

years or so. In the 1950s and 1960s, when the international majors in effect con-

trolled world oil markets, spot crude oil transactions were widely regarded as

peripheral and unrepresentative. Spot deals amounted to just a tiny fraction of totalcrude oil sales, with the market used mainly as a means of getting rid of odd lots or tem-porary surpluses. Prices were usually at a discount to term-contract levels, with little volatil-ity. There were relatively few market participants, and there was little price transparency.

By the early 1970s, the growing importance of US independent oil compa-

nies to international oil-production operations was providing an increased

PROPORTION OF US CRUDE OIL IMPORTS ON A SPOT BASIS BY REGION

North SouthYear Total Africa Asia Europe Mideast America America1996* 33.4% 71.7% 37.0% 43.7% 13.3% 19.6% 36.0%1995 36.3 69.4 52.8 63.0 15.6 23.7 32.51994 36.5 72.0 59.2 67.2 18.9 20.1 30.41993 32.7 61.3 53.4 65.0 20.0 19.5 23.01992 31.1 54.0 62.6 73.8 19.7 15.1 24.61991 29.9 46.3 64.4 63.9 24.4 15.9 26.11990 30.5 44.7 59.3 73.8 23.6 12.3 31.01989 32.2 54.0 59.7 55.2 25.8 9.6 29.91988 25.8 39.2 41.2 62.6 21.2 9.7 23.51987 33.7 52.3 46.9 77.6 27.5 12.0 28.8

Total US Crude Oil Imports (Spot & Term)(In 1,000 b/d)1995 6,532 1,312 115 472 1,418 2,274 1,340

*First quarter only. Source: US DOE.


role for the physical spot crude oil market. The supply dislocations and price

explosion created by the Arab oil embargo in 1973 gave further impetus to spot

trade. But the spot market, although growing, was nevertheless relatively small com-pared to the huge volumes of oil still moving via the vertically integrated systems ofmajor oil companies and their term-contract sales. The 1973-74 price explosion did,however, spawn or enlarge several specialized oil-trading and brokering companiesthat previously were mainly involved in the more active market for refined products,especially in Northwest Europe and the US East and Gulf Coasts. This provided mid-dlemen and intermediaries that gave the spot market more participants and the poten-tial for added liquidity.

The key events that opened the way for the international spot crude oil mar-

ket to play today�s central role include the use of spot sales by Iran in 1973 that

signaled higher Opec prices. This was then followed by the nationalization of oil

companies� upstream operations in producing countries. The change in owner-

ship effectively broke the vertically integrated structure of the oil industry, cre-

ating a gap in the supply chain that was eventually filled largely by the spot mar-

ket. With oil output now mostly in the hands of producing governments and the down-stream refining and marketing operations still held by international oil firms, the poten-tial for further supply dislocations was increased, creating new opportunities for oiltraders. Initially, almost all of the oil continued to move in term contracts, but these werenow open to a larger spectrum of companies, and spot market pressures soon becamehard to resist. Meanwhile, in the US, the system of government price controls createdincentives for increased spot trading.

The next international oil crisis, sparked by the Iranian revolution in late

1978, put the spot crude oil market on center stage as the main barometer for

rising international prices. The volume of spot transactions remained relative-

ly small, at an estimated 5% of oil trade, but the market�s influence was much

greater. Many Opec producers raised the official prices of their term-contract salesfaster than scheduled in an effort to catch up with spot market levels. They also auc-tioned cargoes on a spot basis and added premiums to their prices. These policies cre-ated a much closer and clearer linkage between the marginal or incremental spot bar-rel and baseload term-contract supplies � a relationship that was to haunt these sameOpec producers later in the 1980s. With hindsight, it�s obvious that the lesson here wasthat the spot market is always more attractive to the seller when prices are rising andto the buyer when they are falling. This truism is what ate away at the fixed-price sys-tem in the early 1980s.

Spot Markets Take Hold

After crude oil prices peaked at over $40 a barrel in early 1981, a long decline

set in that was also led by the spot crude oil market. Producers inside and out-

side Opec tended to follow spot prices lower reluctantly, trying to preserve theircontrol over the market. In order to maintain term-contract sales, the non-Opec produc-ers were more responsive to downward spot market pressures, while the adjustments inOpec official prices came after long and often-painful negotiation.

Opec�s defense of higher official price levels, led by Saudi Arabia, meant a

huge loss in term export sales as global demand fell and buyers turned increas-

ingly to the rising supplies from cheaper non-Opec and spot market sources.


Large volumes of Opec crude oil also leaked into the spot market through a vari-

ety of alternative marketing mechanisms at the lower price levels, boosting spot

market volumes to over one-third of oil sales by the mid-1980s. Term crude oilsupplies, with their fixed prices and volume commitments, were increasingly seen by oilcompanies as too risky in an environment of falling prices. At the same time, forwardand futures markets were growing rapidly as oil-market participants struggled to copewith the risk created by price volatility. This also brought greater price transparency andplaced further emphasis on the spot market. Oil-trading companies, too, were thrivingon the volatility spawned by the breakdown of Opec�s official pricing system.

In a bid to regain lost market share and boost its revenue, Saudi Arabia aban-

doned both its Opec swing-supplier role and the official price system in late

1985, opting for direct linkage of its crude oil prices to spot product markets with

netback pricing. Other Opec members quickly followed suit, and oil prices

crashed. Spot markets led the plunge in oil prices in 1986, with large volumes continu-ing to trade on a spot basis despite the new netback sales contracts, which effectivelygave refiners a guaranteed profit margin. This seemed to underscore the permanence ofthe spot market�s new prominence and the difficulty that Opec and the oil companieswould face if they tried to put the spot-market genie back in the bottle.

While netback crude oil pricing was abandoned in early 1987 as Opec tried to

reassert control over markets, this methodology did open the way for virtually

all oil supplies to be linked eventually to marginal or incremental pricing.

Netback pricing has a reputation for causing instability, in part because of the events of1986. Nonetheless, the concept of linking crude oil prices to the values implied by prod-uct markets does make good economic sense. Opec�s resurrection of fixed prices in 1987quickly proved unworkable due to a rapid return to spot sales and other alternative mar-keting mechanisms. This time around, Saudi Arabia opted for a new market-linked pric-ing system tied to benchmark spot crude oils, with geographically specific formulas fordifferent regions. This system is the main subject of Chapter C on term supplies.

By the late 1980s, almost all internationally traded oil was priced on a mar-

ginal or incremental basis through some form of direct or indirect linkage to

the spot market. Although this initially benefited buyers enormously, they

soon found that it cut the other way with the Gulf war in late 1990. However,

the system survived that crisis successfully, underscoring the broad acceptance

of spot-linked pricing and the predominance of spot markets. In the autumn of1990, anxiety over oil supplies due to anticipation of the Gulf war tightened spot mar-kets, which briefly touched $40 a barrel. With baseload supplies tied to the spot mar-ket, term-contract prices followed suit, even though no genuine shortage of supply ulti -mately developed � in part because the impact of higher prices encouraged risingproduction.

What Makes A Benchmark Crude Oil

A crucial element in the development of the spot oil market in the late 1970s

and early 1980s was the emergence of key benchmark grades. These grades

served as the chief reference levels for crude oils of similar quality and in simi-

lar locations, providing a focus for increased trading and a rise in market liq-

uidity. The first international spot market benchmark grades were Arabian

Light in the Mideast (see pH227) and UK Forties in the North Sea (see pH247).


The US market was only indirectly linked to international spot markets until 1981 dueto the complexities created by Washington�s controls on crude oil prices. Arabian Lightwas a natural benchmark because of the prominent market role that it played in Opecas the key reference grade for the official price system, and because of its widespreadusage by refiners in the US, Europe, and Asia. In fact, as the world�s top-volume crudeoil from the largest crude oil producer and exporter, it would be a natural benchmarktoday if not for Saudi Arabia�s policy of suppressing spot trading of its crude oils. Fortiesserved as a benchmark because of its robust volume, but it was replaced by Brent rel-atively quickly.

The emergence of UK Brent as a North Sea reference crude oil (see pH241) in

place of Forties in the early 1980s was no accident; it resulted from the grade�s

mix of key characteristics. Ironically, Forties may again become the North Sea

benchmark by the end of this decade because it is expected to embody these

critical qualities better than Brent will. Brent currently possesses all of the vital

criteria that spot market participants seek in a benchmark grade � volume,

security of supply, diversity of sellers, and broad acceptance. A significant volumeof actual barrels is needed in order to provide liquidity to the physical spot market. AfterBrent�s liquidity was threatened by production problems in 1989, a commingling of theBrent and Ninian streams in 1990 helped to assure a large tradable volume. A diversityof sellers is also needed to prevent a single producer from having too much marketpower. This has been one of the main objections to Forties, which was previously dom-inated by British Petroleum. But rising production from a host of other producers feed-ing into the Forties system has made it a larger, more diversified stream, with output of1-million b/d in 1996 versus about 775,000 b/d for Brent Blend. The final key charac-teristic is that the crude oil must be familiar to a wide array of refiners and welcome intheir systems to assure easy market liquidity.

As Riyadh suppressed spot trade in its oils, Dubai crude oil (see pH87) gradu-

ally displaced Arabian Light as the primary Mideast spot crude oil in the mid-

1980s, even though it does not fit the profile of the ideal benchmark grade near-

ly as well as Brent does. Market participants have worked hard to keep Dubai alive asa benchmark, and one of the main reasons for its success is the need for some Mideastspot price reference and for a heavier, high-sulfur spot benchmark grade in internation-al trade. Dubai�s production is relatively small and declining, but it makes up for this inpart by the fact that it is almost entirely spot-traded.

US West Texas Intermediate became a benchmark spot crude oil almost by

default (see pH257). In 1983, it was selected as the main reference grade for the

New York Mercantile Exchange�s new crude oil futures contract, which caught on

quickly and has put a spotlight on WTI trading ever since. While not ideally suitedas a world benchmark grade, mainly because of its landlocked delivery system and dis-tance from international markets, its tremendous success highlights the crucial impor-tance of liquidity in a successful trading grade. With the huge volume of the futures mar-ket behind it, WTI gained worldwide visibility.

Benchmark grades are critical in defining the spot values of related crude oils,

and they also have become the key price variables in many term-contract price

formulas. In addition, they are the basis for most hedging and risk-management

efforts and attract the bulk of speculative trading interest. All of this makes the

benchmarks important, but they are all messy and flawed. Nevertheless, as in


other commodity markets, nothing succeeds like success. There tends to be a self-sustaining quality to these benchmark grades, as their liquidity attracts other participantsand further enhances their trading volume. The basic irony of all of them in economicterms is that they are providing the main marginal-pricing signals for the world oil indus-try, but they do not fully represent marginal supplies. Brent, Dubai, and West TexasIntermediate are all in the hands of producers that always produce as much oil as theycan and have little flexibility to expand flows. The marginal supplies to the world mar-ket come mainly from producers in the Mideast Gulf, especially Saudi Arabia. But thesecountries have discouraged spot trading of their crude oils, preventing them from beingused as benchmarks. However, both Brent and WTI are marginal in the sense that theyare among the last barrels sold to refiners, and hence they reflect the immediate supplypressures that are facing buyers.

Multidimensional Benchmarks

Despite their imperfections, highly liquid and efficient markets for prompt

and forward supplies have developed for the key international benchmark

grades. They operate on at least two or three of the following four levels: on the

spot market for immediately deliverable physical oil, on an informal �paper� for-

ward market up to several months ahead of delivery, on organized exchanges for

futures contracts, and on over-the-counter markets for customized price swaps

and options. The financial derivatives such as swaps and over-the-counter options thatreflect a fourth layer of trading are closely linked with futures plays. There is a synergybetween these levels, and forward and futures prices converge with those for physicaloil as their contracts near expiration. These forward and futures transactions interact withthe spot sector to reflect changing market conditions, and they also serve to attract trad-ing by companies handling similar grades or buying crude oil in the same region,because the forward and futures trading capabilities allow them to both take speculativepositions and manage risk.

The existence of these forward and futures markets in the benchmark crude

oils not only attracts liquidity to the grades, but also makes the price signals that

they provide extremely important. As well as providing vital indications of cur-

rent market levels, the benchmark grades give readings on the changing value of

future supplies, which fluctuate between trading at a premium or at a discount to

spot barrels. The value of a benchmark crude oil in the future is based on a numberof factors, among which are the cost of money, the current level of excess commercialinventory, the cost of storage, and the general outlook for future supplies. In marketswhere immediate barrels are in surplus and where traders anticipate that supplies willtighten over time, prompt crude oil tends to trade at a discount to future deliveries in aprice structure referred to as contango. In markets where immediate supplies are restrict-ed or it is perceived that more oil may later become available, spot prices carry a pre-mium to forward values in a structure referred to as backwardation.

Forward, futures, and swaps transactions are referred to as �paper� trading

because they most often end in financial settlements between parties as opposed

to physical delivery of oil. This aspect of trade enhances liquidity since partici-

pants can trade more oil than physically exists, providing more active markets

and better price information, especially in futures markets. Organized exchangesserve as clearinghouses that guarantee the financial integrity of a wide range of buyers


and sellers taking positions and making cash settlements. In forward markets, whichoperate informally, participants must provide their own protection from defaults and thustend to be more selective about their activities. In the cases of both Brent and Dubai, theinformal markets have sometimes suffered serious breakdowns, which are describedbelow in the subsections on each individual benchmark grade.

Brent: The International Benchmark

Brent Blend stands alone among all crude oils as the chief international

benchmark grade (see pH241). By virtue of its liquidity, visibility, and wide ac-

ceptance throughout the Atlantic Basin, its predominance has grown to the point

that it is the primary reference for pricing more crude oil, both on a spot and

term-contract basis, than any other grade of oil. Despite its central position, the

market is not without its peculiarities, imperfections, and weaknesses. In the spotmarkets for European and African crude oils, virtually all trades are now conducted at adifferential to Brent rather than at an outright price, as was the case until 1987 or so.Almost all other previously independent spot market reference points, such as Libyan EsSider, Nigerian Bonny Light, or Russian Urals, have given way to direct Brent linkage (seepH153,H183,H221). This same trend is also true for the formula prices of term-contractsupplies sold into Europe from almost any market in the world. Brent-linked pricing isalso used for African crude oil sales to the US and other markets.

Referring to the Brent market as a single entity is a convenience, but it is

somewhat misleading. As mentioned above, Brent is a complex of three interre-

lated markets � spot, forward, and futures � each with different characteristics

and functions. But with Brent, more than any other benchmark grade, none of

the three parts of the triad is dominant: All are mutually dependent and could

not exist or would be unrecognizably different without the others. This linkage isone of the weaknesses of the Brent market because troubles in one area, such as asqueeze or other price distortion, can feed into different market segments, but the ad hocnature of the ties and the ability of the three markets to interact and evolve together isprobably also one of its operational strengths. To get a complete picture of Brent, allthree submarkets must be viewed together.

One of the best illustrations of the linkages between the three sectors is in

pricing, which shows the fragility and the specific roles of each one. In the

spot market for physical Brent cargoes, which is known as �dated� Brent,

prices are set at a differential to those in the forward market, which is known

as 15-day Brent, instead of on an outright basis. But in the 15-day Brent market,

spread trades rather than outright deals have also become dominant, and the

most visible, immediate price signals come from the formal Brent futures mar-

ket. Thus the futures arena is a key source of prices, with a constant interplay

between the three determining the value of Brent. However, the connections arefar from seamless, and the efficiency of the pricing system is partly a reflection of theconstant efforts of market participants to overcome and adjust for these imperfections.The coexistence in Brent trade of the 15-day forward market and the formally orga-nized futures market is an anomaly � in a typical commodity market there would usu-ally be one or the other, but not both. The reason that one has not driven out the otheris that they meet the needs of participants for different types of Brent transactions.Many players in Brent participate in all three submarkets, and indeed, many of them


set trading positions designed to capture profit opportunities resulting from the pricedifferentials between the three sectors.

Dated Brent: The Spot Market Arena

A dated Brent deal is much like any other physical spot market transaction,

with the buyer taking delivery of an actual cargo under set terms of time, price,

and so forth. The main factors that distinguish the �wet� barrel market in Brent

are its linkage to the forward and futures markets for �paper� barrels, and the

widespread use of its prices as a reference point for other crude oil trade. An esti-

mated 50%-60% of all Brent loading, or some 400,000-450,000 b/d, correlates to

dated transactions, which involve a specific physical volume with a set three-day

range of dates for loading � hence the term dated Brent. Virtually all of the tradingin these physical cargoes occurs in the few weeks immediately before they are loaded.Trading further in the future is handled by the forward, futures, and swaps markets; trad-ing at the time of loading or afterward is rare except for some cargoes in transit to moredistant markets, such as the US. The relatively high liquidity of dated Brent trade is vitalto the smooth functioning of the more heavily traded forward and futures markets thatare linked to it. Not surprisingly, the biggest sellers of dated Brent cargoes are traders andWall Street financial institutions that have acquired barrels in the forward market but lackrefining capacity. The biggest buyers are major oil companies with refining operations inNorthwest Europe, but smaller refiners in the US and Europe are also active.

Of the interlinked Brent markets, the dated sector is the most closely tied to

the physical operations of the Brent production and loading system. It is high-

ly vulnerable to dislocations in output, as seen, for example, in the accidents

that plagued the Brent system in 1989-90. But those problems were overcome by

the commingling of the Brent and Ninian crude oil streams in 1990, and the

enthusiasm for Brent as a pricing benchmark has been maintained. Since datedBrent represents actual prompt supplies, it is generally the preferred price barometer forother spot transactions and for term price formulas, despite the fact that prices are setat a differential to forward Brent rather than on an outright basis. Dated Brent serves asa pricing benchmark for all European and African crude oil production as well as forterm-contract sales of Mideast and other non-European crude oils into Europe.

The UK tax regime has also provided an important prop to an active physical

market in Brent over the years because producing companies can use the market

to establish a lower, more advantageous price on their production for tax pur-

poses. Known as tax-spinning, the practice is completely legal and has continued

since the early 1980s, but it has become subject to tighter regulation and is not

as prevalent as it once was. The government moved in late 1993 to limit the timeallowed for companies to declare a sale valid for tax purposes to just 24 hours. Producingcompanies can still reduce their tax exposure by selling barrels into a falling market,even on such short notice. The practice is believed by many observers to add to down-ward pressure in a weak market and amplify upward pressure in a rising market. Fornow, a delicate balance exists between the government tax authorities and the UK pro-ducing companies. The government seeks to maximize its revenue without seriouslyundermining the level of trading in the widely relied upon dated Brent market, while oilcompanies seek to take as much advantage as they can of the tax law without sparkingadded government regulation.


The biggest innovation in the Brent market in the 1990s has been the so-called

CFD or contract for differences market, which in practice provides a direct link

between the �wet� barrels of the spot market and �paper� barrels of the forwards

and futures markets. The CFD market is described in more detail below, but its emer-gence has drawn increased attention to the pricing of dated Brent and the critical roleplayed by price reporting services such as Platt�s and Petroleum Argus. These concernsabout the accuracy of price reporting also relate to the declining production of Brent,which means that as spot market liquidity declines the reliability of the price signal fromthe market may wane, which could eventually undermine its benchmark role. With BrentBlend production expected to decline to about 400,000 b/d soon after 2000, the liquidi-ty issue is likely to become increasingly important in the future.

15-Day Brent: An Elite Club

In contrast to the trade in physical cargoes, a transaction in the 15-day for-

ward Brent market is a commitment to supply or lift Brent during a specified

month in the future. As in a futures market, traders are exchanging promises

rather than oil. The big differences between the forward and futures markets are

the informality and the narrower group of participants in the 15-day market.

Under the current rules of the Brent forward market, the seller must give the

buyer 15 days clear notice of a three-day loading window for the cargo that is to

�wet� the paper contract � hence the name 15-day market. This means that the lat-est point at which a January forward Brent cargo can be sold is the middle of January,since 15 days notice cannot be given in the second half of the month. The loading pro-cedures at the main terminal of Sullom Voe are one key factor influencing the structureof the 15-day market. Producing companies must nominate their preferred loading datesfor the relevant month by the fifth of the preceding month and settle the whole month�sprogram by the 15th of the preceding month. Thus, a company wishing to sell forwardcannot specify an actual range of delivery dates until the 15th of the previous monthwhen the liftings schedule is made final. Delivery dates are set at the seller�s discretion,and the general terms and conditions established by key Brent producer RoyalDutch/Shell are generally used by most parties.

The 15-day Brent market trades as much as three to four months ahead of the

date of loading, although one-month forward tends to be the contract with the

most liquidity. Contracts are negotiated directly between parties for 500,000 barrel car-goes, but a customary 5% volume tolerance has created opportunities for sharp tradingpractices that some key players, such as Shell, have tried to limit. However, the abilityto benefit from volume tolerances also is an attraction to many traders and thus a sourceof market liquidity. The large transaction size together with creditworthiness and a rep-utation for reliability are key concerns that limit the number of participants. These wor-ries have grown following serious defaults that have at times gripped the market.

The number of firms in the 15-day market has declined significantly since

1986-88, and the types of enterprises involved have changed markedly over time.

About 100 companies are estimated to have been active in the market in the mid-1980s,but this declined to 50-60 in the early 1990s. Among the main shifts in participation,Japanese trading houses � which were quite active in the 1980s � have dropped outalmost completely, while Wall Street financial institutions and commodities houses havebecome much more active. The 15-day market is dominated by the Wall Street-type firms


THE CLUB: TOP 10 PARTICIPANTS IN 15-DAY BRENT

1986 1991 1993 1995Rank Company % Share Company % Share Company % Share Company % Share

1 Phibro 8.7% J. Aron 15.8% J.Aron 12.0% J.P. Morgan 13.8%2 J. Aron 7.4 Phibro 10.6 BP 9.5 Phibro 11.73 Nissho Iwai 6.1 Cargill 5.9 Koch 7.6 BP 9.34 Shell UK 5.5 Shell Int�l. 5.8 Phibro 5.9 J. Aron 8.45 Drexel 4.3 Total 5.4 Shell Int�l. 5.8 Statoil 5.86 Marubeni 4.2 BP 5.0 Shell UK 5.5 Elf 5.07 BP 3.6 Statoil 4.7 Elf 5.5 Morgan Stanley 4.88 InterNorth 3.5 Morgan Stanley 4.3 Cargill 4.8 Shell Int�l. 4.89 Shell Int�l. 3.3 Hess 3.4 Dreyfus 4.7 Koch 4.4

10 Kanematsu 2.9 Marc Rich 3.4 Morgan Stanley 4.3 Shell UK 4.2Total 49.5 64.3 65.6 72.3

Note: 1995 data are for first six months. Source: Derived from Petroleum Argus Crude Oil Deals Database by OxfordInstitute For Energy Studies.

and the producers of Brent Blend, according to the Petroleum Argus Crude Oil DealsDatabase. The table above, which was derived from the database, shows the top 10 par-ticipants in 1986, 1991, 1993, and 1995. The market has become progressively more con-centrated in the hands of the largest players, with the top 10 firms accounting for over70% of trading as smaller participants have moved over to the futures market.

As an informal market, 15-day Brent has no central clearinghouse and no

process under which various buy and sell positions are rationalized at the end of

each day to determine what each participant�s open commitments are. Instead, a

network of loose chains of obligations exists, which take final form only as phys-

ical cargoes are sold into the dated Brent market, effectively �wetting� the chains.

When a producer serves the first buyer with notice of the loading dates for a physicalcargo, that buyer has the choice of taking delivery of the oil or passing the notice on toa second company to which it has a sales commitment in the forward market. A singlephysical cargo typically moves through a �daisy chain� of buyers and sellers until itreaches a party that either wants to take the oil or simply has no alternative but to do sobecause of its trading position (see chart, pB2). This process occurs in the periodbetween the time that the loading schedule is set and the time that the 15-day notice ofphysical loading must be received.

When chains are long, or if a participant is slow in responding, a purchaser that didnot intend to take delivery may receive notice of a cargo at the last possible moment, at5 p.m. London time, 15 days before the cargo�s three-day loading window. This is knownas being �five o�clocked� or �clocked,� and it is not looked upon kindly. The number of�clockings� is often viewed as an indicator of market sentiment. If clockings increase, thisis a sign of a reluctance to take cargoes and of possible price weakness, while a declinein clockings is viewed as the opposite. The course of a chain is not predetermined, andsometimes the producer that provides the first cargo can also wind up being the one tak-ing delivery at the end of the same chain.

Parties can also opt to settle a Brent chain or a part of it in a financial transac-

tion before the date on which delivery notices would be served. In this so-calledbook-out process, a seller tries to identify other parties in a potential chain that might allbe willing to cancel out their respective obligations on paper. A cash settlement is then


made between parties in the chain for the difference between their transaction prices.Informality brings both risks and advantages for participants in the 15-day

Brent market. The system of daisy chains means that all participants are vulnerable toa default by any individual firm in the chain and explains the restrictive nature of thegroup and the concern for creditworthiness among participants. But this risk is counter-balanced by the advantage of the 500,000 barrel contract size, which allows a firm toquickly build or dissolve a large market position. The absence of a clearinghouse alsomeans that participants need not make potentially costly margin payments to maintain aposition, as is the case in the futures market.

The focus of trading in the 15-day market is divided between outright deals

and spread trading. In the latter, participants trade two counterbalancing posi-

tions between two grades of oil or between different time periods for Brent deliv-

ery. Outright deals are primarily the province of Brent producers. As of the early

1990s, the percentage of outright 15-day Brent trades had fallen to just over 20%

of all transactions, compared with about two-thirds in the 1986-87 period, but

outright trades had climbed back to about 50% of the total in 1995. The larger pro-portion of outright deals emphasizes the market�s continuing importance for tax opti-mization purposes. The popularity of spread trading reflects a general strategy for mini-mizing the risks of price volatility, the interlinkage of markets through arbitrage, and thewidespread use of price differentials for most trading.

Brent Futures: The Price Barometer

After two unsuccessful attempts, London�s International Petroleum Exchange

finally scored with a viable Brent futures contract in the summer of 1988. This

formal market for futures supplies involves cash settlement rather than physical

delivery, with prices from the 15-day market used to determine the final value

for the contract when trading closes out. In practice, this means that the prompt

price in the Brent futures market actually represents the value of the oil as much

as a month and a half before physical delivery. While this is an unusual structure fora futures market � which typically ties directly into physical spot markets � and thusmight seem to limit its usefulness, the structure actually makes the futures market a nat-ural complement to the 15-day market. It allows for easy trading of the much-smaller1,000 barrel lots of the futures market and it also permits smaller companies that lackadequate credit or that do not need the large trading lots of the 15-day market to hedgeand speculate on future price trends. The level of regulation that is standard in futuresmarkets also removes the risks of default that exist in the less formal 15-day market.Futures market participants can also achieve physical delivery by an off-exchangeprocess known as EFPs, or exchanges of futures for physicals, in which two parties agreeto swap their respective futures market positions for crude oil supplies.

In addition to providing an added dimension to the 15-day Brent market for

the trading of smaller volumes by secondary participants, the futures market has

emerged as the key tool of price discovery. The convergence between futures

prices and the 15-day market is strong due to the futures contract-settlement

mechanism. The liquidity and small contract size of the futures market also facil-

itate trading and have made the IPE a key nerve center, providing a constant indi-

cator of the value of oil for the same period being traded in the 15-day market.

In effect, the IPE has displaced the need for intraday price quotes in the 15-day market


by providing a clearly visible price that informs both the trading in the 15-day marketand transactions in the dated Brent market. The duality between prices in the futuresmarket and those in the 15-day market is not perfect, however. In a rising market, forinstance, the opportunity to use the volume tolerance, with the buyer using his right toinsist on an additional 5%, or an extra 25,000 barrels, adds value to a cargo relative tothe futures and 15-day price. The reverse may happen in a falling market. In periods ofextreme tightness or anxiety about physical supplies, such as during the Gulf war, the15-day market has tended to trade at a premium to IPE futures. The reason is that theforward market represents a contract commitment for a physical cargo � which is moreuseful to a refiner in a supply crisis � while the futures market relies on cash settlement.On the other hand, for much of 1996, dated Brent traded at a discount to 15-day pricesdespite the overall rise in market levels.

The futures market represents a broader range of participants than either the

15-day or the dated Brent market, but it draws heavily on both. In addition, NorthSea producers of smaller, non-Brent crude oil streams and European refiners are partic-ularly active. The majority of participation in IPE futures contracts is from European-based companies, but the broader international focus of the Brent contract probablypulls in increasing non-European trading. The IPE has promoted trading of the contracton the Singapore Monetary Exchange and has also successfully introduced options on itsBrent crude oil futures contract.

CFDs: Brent�s Bridge Between Spot And Forward Trade

An important new hedging mechanism has developed in the Brent market

since the early 1990s that goes beyond those available from either the 15-day

market or IPE futures. This so-called CFD market allows participants to cover the

price risk associated with a specific date range for physical loading. In essence,

it acts as a bridge between the 15-day, or forward market, and the dated Brent

spot market, and as such provides a critical fourth leg to the Brent market com-

plex. CFDs are essentially extremely short-term price swaps, but like dated Brent trans-actions, they are priced at a differential to the forward Brent market. The transactions aredesigned to provide price insurance in the period of two to six weeks between the timethat a 15-day forward Brent cargo becomes wet and the time that it loads. The main ben-efit of CFDs to both buyers and sellers is that they lock in a price and reduce potentialexposure to risk in the dated Brent market, effectively providing the kind of protectionfor dated Brent that already exists for future supplies through the 15-day market.

The CFD market has grown rapidly since about 1993 and trading volumes as

of 1996 were significantly larger than for dated Brent itself. About 90% of the

trades in CFDs are by firms that are active in both the dated and 15-day markets.

This group of about 30 consists of large North Sea producers, Wall Street firms, and oiltraders. Like the spot and forward markets, it attracts active interest from both hedgersand speculators. In 1995, CFD trading volume was about twice as large as dated Brentactivity, according to Petroleum Argus data, which would indicate that the market hasbecome mature and well-established.

While CFDs would seem to be a perfect complement to the other Brent mar-

kets, these derivatives have come under criticism as a vehicle for market

squeezes and as a source of price volatility. While there is evidence of both of

these trends in relation to CFDs, the criticism is largely a case of blaming the


messenger. The Brent market seems to be adjusting to the new member of the

family fairly well, with fewer signs of problems in 1996. The emergence of CFDscoincided with a period of great volatility in the spread between the dated and 15-dayprices. While the CFD market is meant to hedge that risk, it also may have promptedincreased efforts to manipulate price quotes for dated Brent. It also seems to have con-tributed to squeezes in the forward market, because it provides a way for the initiator ofa squeeze to make a profit unwinding the long position that has been created in the for-ward market by taking offsetting positions in CFDs before the squeeze gets going. Theseissues have been examined closely by the Oxford Institute for Energy Studies in theircontinuing analysis of the Brent market.

West Texas Intermediate: Improbable Price Leader

One of the greatest ironies of the world oil market is that the most visible, highly

traded crude oil in the world is West Texas Intermediate � a landlocked US

domestic grade that never appears on the world market and only competes with

internationally traded crude oils when they are imported into the US (see pH257).

WTI owes its prominence to the fact that it is the main grade used in the New York

Mercantile Exchange�s light, sweet crude oil futures contract. Riding the huge vol-

ume of Nymex futures, WTI is a highly visible reference point that equals or

exceeds UK Brent grade in importance, depending on one�s location around the

globe. WTI was chosen as the primary crude oil for the Nymex futures contract back inthe early 1980s, mainly for operational reasons. Unlike the large cargo volumes of theinternational spot market, WTI�s pipeline-based transportation network allows for themovement of the relatively small volumes that match the physical delivery needs of afutures market in the early development phase of a new contract. However, these oper-ationally driven decisions � aimed at launching a successful crude oil contract in 1983despite an oil industry that was still quite skeptical about futures � resulted less than adecade later in the emergence of an improbable global price leader, full of complexitiesand obvious imperfections. The Nymex crude oil futures contract itself trades 1,000 bar-rel lots of WTI-type crude oil for delivery at the Cushing, Oklahoma, pipeline hub.

Despite its unambiguous US orientation and several other flaws that are

described below, WTI�s ability to assume a global benchmark role underscores

the importance of futures trading in the international oil industry. With daily

futures volume in the Nymex light crude oil contract averaging the equivalent of

100-million b/d, the WTI market is effectively more than twice the size of that for

Brent futures, which itself is about two to three times as large as the 15-day Brent

market in total volume, by most estimates. The main importance of this huge vol-

ume is that it provides immediate price transparency and an arena for all global

market participants to react to the latest trends. Partly with this role in mind, Nymexlaunched a 24-hour electronic trading system in 1993 that allows interested buyers andsellers to continue trading after exchange hours, except on weekends and holidays.WTI�s central price role is reflected in the fact that most trading of Brent and other inter-national spot grades occurs during the hours of the Nymex session, with even the IPEfutures market adjusting its hours and staying open late in order to overlap with Nymex.

However, without the bright light that shines on it from the Nymex futures con-

tract, there is no doubt that WTI would go largely unnoticed, like most other US

domestic grades. The crude oil�s benchmark status is derived from its use in the


world�s biggest oil futures market, and not from its physical characteristics, which

significantly inhibit its usefulness. To overcome some of these inherent con-

straints, Nymex actually allows a wide range of both domestic and international

crude oils to be delivered against the contract, although in practice most deliveries

that are processed by the exchange itself are for WTI. Significant volumes of othercrude oils are delivered under exchanges of futures for physicals (EFPs), special off-exchange mechanisms between consenting buyers and sellers, but these individualizedtransactions do not have to track the physical market as closely as formal deliveries throughthe exchange, which are meant to provide a physical link for futures prices. Six US crudeoils in addition to WTI can be delivered along with four international grades � Brent Blendand Forties of the UK, Norwegian Oseberg (see pH203), and Nigerian Bonny Light. Until1990, Norwegian Ekofisk, Nigerian Brass River, and Algerian Saharan Blend and Zarzaitinewere also deliverable, but they were removed following complaints from Midcontinent USrefiners that received some of these crude oils unexpectedly (see pH197,H187,H29,H31).

Ambivalence Toward WTI

Although Nymex crude oil futures are now the exclusive benchmark for spot

crude oil trading in the Americas and they are the pricing base, either directly or

indirectly, for almost all US and Canadian crude oil sales, much suspicion remains

about WTI as a benchmark in the broader international arena. This ambivalence per-sists even following the switch to WTI-linked formula pricing by Saudi Arabia and othersfor their US sales as the usefulness of Alaskan North Slope as a benchmark diminished (seepH251). The past problems of ANS are explained below, but the emergence of new sourcrude oil production streams from the US Gulf Coast such as Mars Blend (see pH255) rais-es the possibility of a new sour crude oil marker grade that could overcome the quality andlocation limitations of WTI.

Much of the ambivalence toward WTI is well justified. US restrictions on exports

and the structure of the domestic market prevent it from being traded interna-

tionally, making its links to the global market tenuous at times. The domestic US

THE CUSHINGPIPELINE HUB


orientation of its market have resulted in several extended periods in which prices

have become virtually disconnected from international market trends. While WTI

competes directly with foreign crude oil supplies at refineries from the Gulf Coast

to Chicago, pipeline constraints and internal market pressures inevitably create

distorted price relationships at times. These discontinuities with the international mar-ket and the reasons for them can easily be seen from a brief description of the physicalcharacteristics of trading. WTI production is in decline along with the rest of total US crudeoil output. Under a broad definition, flows of WTI in 1995 were just over 800,000 b/d, ver-sus 1.36-million b/d in 1985, and they are expected to reach less than 750,000 b/d by 1998.This decline in the face of gradually rising US oil demand has meant that over the years,a larger proportion of the crude oil is being used in the Midcontinent region and fed bypipeline into the Great Lakes region, and less of it is shipped down to the US Gulf Coastrefining center, where it competes more directly with international supplies. The primaryinfluence on the physical market for WTI crude oil is the demand from refiners inOklahoma and Kansas and along the pipelines extending up to Chicago and beyond. Thepipeline system itself also creates a series of special constraints related to its capacity andstorage at various points.

The spot market for WTI is in practice split in two. One center of activity is in

Cushing, Oklahoma, where the trading of supplies for the Midcontinent and

Nymex futures contract deliveries occur. This crude oil moves to inland refiners.

The other center lies in Midland, Texas, a hub where WTI supplies can be shipped

either to Cushing or to the Gulf Coast. Price fluctuations between the two centers

reflect differing market pressures,

which can be extreme. Spot prices arequoted in both of these markets and thegap between them deviates considerablyfrom the 26¢ a barrel that it costs to movea barrel of WTI eastward from Midland toCushing. When the Midcontinent marketis tight, the Cushing spot market trades ata wider premium, and this is reflected infutures prices, especially for prompt sup-plies. However, if the Gulf Coast marketis tighter, the Cushing premium dropsbelow 20¢, and Midland can even tradeat a higher level than Cushing in a peri-od of extreme tightness at the Gulf Coast.Pipeline capacity constraints mean that itcan take weeks for such imbalances towork themselves out, with supplies shift-ing as rapidly as possible to the market where supply is tightest. It costs 30¢ to move abarrel of crude oil from Midland down to the Houston area.

Several pipeline routes allow international crude oils to be delivered to the

central region of the US, but only two systems with combined capacity of about

500,000 b/d reach the key Nymex hub of Cushing, Oklahoma. These links com-

plete the supply picture, which created a serious supply constraint on the

Cushing hub until the more than doubling of the system with the addition of a

WTI-BRENT SPREAD, 1987-96

-0.50

0.00

+0.50

+1.00

+1.50

+2.00

+2.50

+3.00

1/87 1/90 1/93 1/96

$/bbl


new 270,000 b/d Arco leg in the spring of 1996. The expansion should help

improve the linkage between WTI prices and the international market, by allow-ing ample international supplies to flow to Cushing in periods of tightness in the USMidcontinent and Great Lakes regions. The Arco Seaway network has two lines that cannow carry up to 430,000 b/d, fol-lowing the conversion of a gas linefrom Freeport, Texas, and the aug-mentation of the existing 160,000b/d line. A separate Texaco linecan carry about 70,000 b/d. Bothsystems carry domestic and inter-national crude oils, and throughputcan be lower with heavier grades.Moving a barrel of crude oil fromthe Gulf Coast to Cushing costsabout 75¢ a barrel, which meansthat a big premium must exist atCushing to pull in foreign supplies.

At times in the past, WTI

prices at Cushing have departed

from their typical international

market-reference points because

of these rigidities. From 1987-91,

prices were particularly volatile,

and other periods in which the

spread widened to well over

$1.50 a barrel have occurred in

1994 and 1996, indicating a

break with international price

patterns (see chart on pB17). Thetightness in WTI is often due to lowstocks of crude oil or gasoline in thecentral region of the US. The com-bination of expanded pipelinecapacity from the Gulf Coast toCushing, greater reliance onCanadian crude oil imports and better anticipation of such pressures by refiners seems like-ly to make the discontinuities less frequent, but they are unlikely to disappear completely.

WTI: The Financial Benchmark

Even with the limitations of its underlying physical market, the high volume

of futures activity in WTI has pushed it into the position of a leading financial

benchmark for both futures and swaps markets. If the evolving markets in dis-

tant forward months are able to provide the oil industry with a clearer picture of

the long-term value of oil, this signal is likely to come either directly or indirect-

ly from WTI. The Nymex futures contract already has been extended three and one-halfyears into the future. The relatively robust levels of open interest � trading positions that

WTI AND BRENT FUTURES COMPARED*Open Interest Volume

Month Nymex IPE Nymex IPESept. �96 56,691 36,898 39,144 26,026Oct. �96 60,917 59,409 24,972 20,809Nov. �96 33,365 10,869 9,160 4,301Dec. �96 41,627 17,773 9,260 6,997Jan. �97 29,201 11,945 3,364 3,799Feb. �97 20,775 7,345 1,463 1,828March �97 13,589 5,996 750 1,030April �97 10,915 4,441 1,229 0May �97 6,155 1,549 728 0June �97 23,119 4,405 2,020 100July �97 7,834 680 150 0Aug. �97 3,703 135 50 0Sept. �97 5,065 ... 504 ...Oct. �97 2,254 ... 0 ...Nov. �97 5,683 ... 0 ...Dec. �97 20,006 ... 1,048 ...Jan. �98 6,198 ... 100 ...Feb. �98 1,912 ... 0 ...March �98 1,571 ... 0 ...April �98 507 ... 0 ...May �98 367 ... 0 ...June �98 5,965 ... 16 ...July �98 955 ... 0 ...Aug. �98 89 ... 0 ...Sept. �98 420 ... 0 ...Oct. �98 21 ... 0 ...Nov. �98 121 ... 0 ...Dec. �98 6,712 ... 1 ...Jan. �99 0 ... 0 ...Feb. �99 0 ... 0 ...June �99 753 ... 0 ...Dec. �99 6,251 ... 1 ...Total 372,709 161,445 93,915 64,890

*Figures from Aug. 1996.


have not been offset � and active trading in these distant forward months mainly reflectsthe use of the market as a place for providers of price swaps and other long-term for-ward market price-hedging mechanisms to manage the risk that they have taken on.Many of the concerns about the complex WTI delivery system and its rigidities tend tofade away in the forward months and are deemed to be of little importance.

In sharp contrast to Brent futures, which are dominated by oil companies and

traders that are active in the physical market, the WTI market is much more a

mix of physical oil-market participants and financial players, some of which

never trade wet barrels. Commodity funds and other financial entities tend to play abigger role in the WTI market, providing a significant amount of the liquidity in thefutures market. Unlike Brent futures, where over 65% of open interest is for contractsexpiring over the following three months, WTI futures only have about 40% of their openinterest in this heavily traded period. The table on pB18 compares the open interest andtrading volumes in the Nymex and IPE crude oil futures contracts on August 13, 1996,underscoring the different profiles of the two markets. Although IPE has followedNymex�s lead by extending trading to 12 months, market activity in Brent futures is notnearly as great in the so-called outer months. Nevertheless, both contracts see about 75%-80% of their trading volume in the nearest three months. The IPE plans to extend Brenttrading out to 30 months in 1997.

Different Personalities Of WTI And Brent

The heavy financial orientation of WTI trading contrasts with the physical

grounding of Brent trading in the day-to-day pressures of supply and demand in

the international market. This basic difference in personalities between the two

markets seems to have helped make them complementary and interdependent

rather than competitive. While the WTI market provides a highly visible pricing

barometer that attracts widespread and immediate reaction to market develop-

ments, the close physical linkage of Brent to the international market provides a

�reality check� for WTI. Because of WTI�s visibility and liquidity, most other crude oilmarkets prefer, as they trade, to have the extra comfort of knowing how the WTI marketis reacting to psychological factors, financial pressures, and technical influences. However,the Brent market gives out important counterbalancing signals on the physicalsupply/demand pressures of both the European and broader international crude oil mar-ket that WTI traders cannot usually afford to ignore for long. The two markets interact con-stantly with each other in a tension that reflects their own inherent concerns and mix ofparticipants. Neither one can fully represent the global crude oil market on its own.However, the tendency for WTI to be pulled away at times by internal US supply anddemand pressures from international market influences means that the interaction betweenthe WTI and Brent markets is imperfect and unpredictable. The two benchmarks tend tomove in tandem most of the time, but signals can also become crossed and confused. It isat these times that the Brent market most clearly demonstrates its key international role.

Dubai: A Benchmark In Limbo

Although Dubai crude oil stands alone as the only actively traded spot and for-

ward benchmark for the Mideast and for high-sulfur crude oil in general � mak-

ing it the key pricing marker for both spot and term-contract sales East of Suez

� it has some serious problems. Some of the critical trading issues of the early


1990s have been overcome, but the crude oil stream faces a decline in production

that seems likely to undermine the liquidity of spot trading in the future.

Superficially, the Dubai trade appears to resemble Brent�s, but in many respects,

it is more fragile. However, the lack of a viable alternative may well allow the

Dubai market to persist despite these problems. One example of Dubai�s peculiari-ties as a benchmark is that it is only indirectly linked to Mideast and Asian spot crudeoil pricing. Unlike Atlantic Basin spot crude oils, which are priced directly off a differ-ential to UK Brent or US WTI, Mideast and Asian spot prices for the most heavily trad-ed grades are based mainly on their retrospective term-contract prices. Spot levels areusually tied to the respective government-set retroactive monthly prices for the crude oilin question, whether the oil is from Abu Dhabi, Indonesia, or Oman. Dubai prices pro-vide a key ingredient in setting these retroactive prices, but relatively little spot tradingis done on a direct differential to daily Dubai prices, unlike Brent and WTI. However,Dubai, by virtue of its spot and forward market, is considered a key indicator of sourcrude oil values. The monthly average price is also the basic ingredient in term-contractprice formulas for the East of Suez sales by key producers such as Saudi Arabia, Iran,and Kuwait.

Dubai emerged as an important spot crude oil benchmark grade in the mid-

1980s. At that time, third-party trading in Saudi Arabian Light and other region-

al grades wound down as key Opec producers sought to defend prices by limit-

ing spot trade in their crude oils. The forward Dubai market grew up in con-

junction with spot trading, but it has never extended for more than a few months

in advance. The fact that the oil is produced and sold by Western oil companies

has also been critical to the market�s development. Production is divided betweenthe producers � US Conoco (30%), French Total (25%), Spanish Repsol (25%), GermanRWE-DEA (10%), US Sun (5%), and German Wintershall (5%) � and the ruler of Dubai,making for a diverse group of companies to wet the forward market and reducing thechance of a squeeze. The ruler�s share is usually sold either directly into the spot mar-ket or to Western oil companies that resell the oil. Since all of the equity producers havetheir refining capacity in the Atlantic Basin, far from the region, this has provided anadditional incentive for them to sell their crude oil on a spot basis. In the mid-1980s,Japanese trading houses provided much of the liquidity in the forward market � andmuch of the oil also went to Japan. As they withdrew later in the decade due to tradinglosses, Wall Street financial firms largely took their place. Major oil companies andtraders provide most of the other participation.

Threats To Dubai�s Liquidity

The Dubai market faced some serious operational problems in 1993, which cre-

ated a temporary loss of confidence in the forward contract-delivery mechanism

that has since been overcome. But the steady decline in Dubai production means

that even today�s active spot and forward trade relies on a smaller base of physical

barrels, leaving the market more prone to distortion. The terms and conditions of theforward contract were revised in late 1993 by the operator, US Conoco, resolving most ofthe problems by tightening the rules for the selection of loading dates and other adjust-ments. These reforms restored confidence in the physical market and have helped foster aresurgence in trade, which has been also helped by renewed interest in trading pricespreads between Brent and Dubai. There are, however, rumblings about Dubai�s continu-


ing suitability as a benchmark. Trade is almost exclusively limited to a handful of compa-nies that are sometimes suspected of manipulating prices and spreads with Brent. Theemergence of short-term swaps in Dubai may have contributed to this kind of trading.

Dubai output dropped to less than 300,000 b/d in late 1995 as part of a long-

term decline that is gradually reducing the number of available spot cargoes, but

the market has responded to this threat to liquidity in recent years with the growth

of trading in partial cargoes. While Dubai�s usual cargo size, like Brent, is 500,000 bar-rels, which facilitates spread trading, an active market in partial cargoes down to 100,000barrels has sprung up. This �partial Dubai� market is one of the reasons that past attemptsto launch a formal Dubai futures contract in both Singapore and London have failed. Atthe mid-1996 rate of 270,000 b/d, there are, at most, 16 cargoes that can be traded in amonth. This compares with output of over 400,000 b/d, or 25 cargoes, in 1990. Althoughthe output decline eats into overall potential trading volume, notably in the wet barrel spotmarket, it is not clear at what point a spot market becomes too small to support a viablebenchmark role, especially if it has close links to a more active market such as Brent, asDubai does. For example, the US Alaskan North Slope market had managed to cling to abenchmark role on trade of just a handful of cargoes per month.

Another key change in the Dubai forward market in the late 1980s was the shift

in trading from outright transactions to spread trading, primarily off 15-day Brent.

Spread trades, which involve two simultaneous transactions with the same party

which partly offset each other, now account for an estimated 95% of deals, with a

big jump during the Gulf war that has not been reversed since then. This change

means that, in practice, Dubai has evolved into more of an extension of Brent trad-

ing than a market that stands on its own. While price-reporting services can readilydetermine the value of Dubai from the regular volume of spread trades versus Brent, thereis relatively little outright trading activity to provide a counterbalancing check linked exclu-sively to the supply and demand pressures of Dubai itself. The volume of trading in thephysical spot market for Dubai has also declined with the drop in production and the prob-lems with the forward contract, making the market more dependent on the Brent link.

Dubai�s Divided Loyalties

Unlike trading in both Brent and WTI, where there is a considerable overlap

between participants in the forward markets and those that produce and use the

crude oil in refineries, these two groups are quite different in the Dubai market.

The main participants in the forward markets are Wall Street financial institu-

tions, equity producers in Dubai, and other Western oil companies and traders.

But the main customers are refineries in the Indian subcontinent, Singapore,

Japan, and South Africa. Aside from some of the international majors that supply theiroperations in both Singapore and South Africa from the Dubai market, there is little activ-ity among the regional end-users of Dubai crude oil in the forward market � even theinternational majors are not dominant participants. Similarly, Dubai is rarely taken into theAtlantic Basin, and when it is, sales are not usually on a spot basis. Usually, an equity pro-ducer will simply move one of its cargoes to the Mediterranean.

While the Brent linkage in Dubai trading and its declining liquidity call into

question its viability and validity as a benchmark, it also has a good chance of

enduring. The simple fact is that there is no alternative to it anywhere in the

region, and none seems likely to emerge, barring a radical change in the mar-


keting policies of Mideast producers. The Southeast Asian crude oil market suffersfrom an even greater shortage of marker grades, and even if a new sour crude oil mar-ket emerged in the Atlantic Basin, it would be hard for it to provide a relevant price sig-nal for the geographically disparateAsia-Pacific region. The participants inthe market are likely to continue work-ing hard to prevail over Dubai�s draw-backs. If the Mideast producers werewilling to overcome their deep-seatedsuspicions of allowing their crude oils tobe traded freely in the spot market, amore natural and solidly based markermight quickly emerge based on ArabianLight, the world�s largest crude oilstream � but there is no sign of such achange of policy. The only other alter-native might be a more dominantbenchmark role for Oman crude oil (seepH211), which in contrast to Dubai isgrowing in volume. Although Omanplays something of a marker rolealready, there are fewer sellers and its current pricing system is heavily dependent onthe government�s retrospective posting, which in turn is linked to Dubai.

Despite its limitations and potential pitfalls, Dubai provides a vital price sig-

nal for sour crude oils. In fact, the Brent-Dubai price spread is among the most

important in international crude oil trade because it provides a clear indication

of the relative values of light, sweet and heavy, sour crude oils. The spread hasbeen volatile at times, but it has also clearly reflected the shifts in relative crude oil val-ues in recent years. In the early 1990s, the gap was $2-$3 a barrel, but with the tighten-ing of sour crude oil markets in late 1993 and early 1994, the spread dropped abruptly.New refinery investments in upgrading capacity, higher North Sea production, and cut-backs in Saudi sales of heavy crude oils all contributed to this shift that was clearlyreflected in Dubai prices (see chart above).

Other Benchmarks And Their Limitations

Several other crude oils have emerged as benchmark grades for spot trading

over the years and some new candidates are on the horizon. While some grades

have foundered and others may still flourish, the dominance of Brent and WTI as

the main sources of price formation for international oil markets has tended to

overshadow the other markers, and it has made it harder for them to develop

into independent markets. The region where the absence of a clear, unambigu-

ous benchmark grade is most striking is the Asia-Pacific area. While Malaysian

Tapis and Indonesian Minas crude oils partly play this role, neither is up to the

job (see pH169,H125). Part of the problem in the Asia-Pacific region is structural. Dueto the profusion of crude oils and relatively small volumes of production and spot sales,there are few grades that are large enough or traded widely enough to form the basisfor a benchmark grade. The thin trade has resulted in a preference for pricing spot deals

BRENT-DUBAI SPREAD, 1987-96

0.00

+0.50

+1.00

+1.50

+2.00

+2.50

+3.00

+3.50

+4.00

+4.50

1/87 1/90 1/93 1/96

$/bbl

Gulf War


off the retroactive term-contract prices set by local producing governments, much as itoccurs in the Mideast. These prices are usually set on the basis of a formula or someother indirect linkage to the most widely respected regional crude oil price reporting ser-vice, the Asian Petroleum Price Index. This service uses weekly assessments by a panelof market participants rather than traditional daily price reporting by journalists. The spotprices of Indonesian crude oils are linked to the government�s Indonesian Crude Priceformulas, which are drawn in part from APPI price quotes. Malaysian term-contract pricesare based on formulas that rely partly on APPI quotes, and China and Vietnam also relyon APPI prices to determine their term-contract prices.

The Tapis crude oil market is made up of two separate parts � price swaps

and spot trading � which don�t overlap but provide some of the most visible

price signals in the region. Tapis, however, lacks a broad diversity of suppliers

that can guarantee liquidity. Malaysia�s state Petronas is a regular seller of spot Tapis,usually providing at least a couple of cargoes a month for spot trading. But this repre-sents a decline of about 50% from volumes in the early 1990s. Petronas now uses abouthalf of its 210,000 b/d share of output in domestic refineries. Most of the swaps activityis carried out by Wall Street-type financial firms with regional producers and refiners.Unlike a forward market, the swaps lack a formal contract and they never result in phys-ical delivery, but they provide much of the same access to hedging and speculation.While there is some linkage of prices for similar Asian light, sweet crude oils to Tapisspot quotes and while Tapis regularly trades on an outright-pricing basis rather than ata differential to some other grade, it is still flawed as a marker. Since all production is inthe hands of state Petronas and operator Exxon, there is not a wide enough group ofsuppliers to insure against a price squeeze in any given month.

Indonesian Minas crude oil is a more logical Asia-Pacific benchmark grade

than Tapis, as it is the region�s largest volume crude oil and falls midway in qual-

ity terms between the light and heavy grades that are produced there. Minas is

traded regularly in the spot market � although probably not quite as much as

Tapis � but it too is subject to serious liquidity problems that make it an inef-

fective benchmark. Like Tapis, production of Minas is in the hands of only two pro-ducers: US Caltex and Indonesian state Pertamina. In addition, Minas has tended to beone of the grades that Indonesia, as an Opec member, has traditionally relied upon whenit has cut production to comply with quota agreements. Forward and swaps trading inMinas is also limited in scope.

The Heirs To Alaskan North Slope

Although Alaskan North Slope crude oil trading at the US Gulf Coast has now

vanished, it was once an important benchmark and its departure has left a vacuum

for sour crude oil pricing that has been only partially filled by West Texas

Intermediate. Even before the lifting of the US export ban on Alaskan crude oil in 1996,ANS had lost its marker role due to declining production and a steep drop in volumes arriv-ing at the Gulf Coast. ANS was dropped as a marker grade for term sales by Saudi Arabiaand Kuwait in early 1994 and subsequently by Mexico and Ecuador in early 1996, and itsspot price had been derived directly from WTI for years before that. With only a few spottrades a month at the US Gulf Coast, the volume of trading was no longer available to pro-vide either an independent price signal or the basis for a forward market. Heavy spot trad-ing and a forward market in ANS developed in the early- to mid-1980s, but by the end of


the decade, forward trade was already drying up due to the dominant position of BritishPetroleum as a supplier and the rapid growth of WTI futures as a preferred alternative.

Among alternative sour crude oil benchmarks in the Atlantic Basin the two most

interesting prospects are the new Mars Blend grade from the deep-water US Gulf

Coast and Russian Urals in Europe (see pH255,H221). Mars production started in

mid-1996 and the crude oil is being positioned by the main producers, Shell and

BP, as a possible spot benchmark grade. Potential volumes of up to 400,000 b/d or socould be available soon after 2000 and easy access to Gulf Coast pipelines promises anactive spot trade. Furthermore, the main producers intend to sell a large proportion of thecrude oil on a spot basis. Whether this active trade develops into a new Gulf Coast sourcrude oil benchmark to fill the gap left by ANS depends on how the market and other pro-ducers react to the new grade, which is likely to trade initially at a differential to WTI.

In Europe, Russian Urals has been touted from time to time as a potential sour

marker, but its time has not yet come. It is still priced mainly at a differential to

dated Brent, but some Russian exporters and European traders hope to see it grow

into a high-sulfur sour crude oil benchmark in its own right with an active forward

and futures market. Heavy spot trading has developed in recent years, especially

in the pipeline system into Eastern Europe. This now involves both wet barrels andforward paper commitments a month or two in advance. A wide variety of players areinvolved, including Western firms producing oil in Russia or with access to exports, a hostof Russian firms, Eastern European refiners, and other Western companies. The main prob-lems lie in the uncertain quality of Urals, which could pose problems for trading. In addi-tion, fears of Russian political instability and the potential for abrupt changes in govern-ment controls over exports have also dented enthusiasm for Urals as a marker.

The Dominance Of Spread Trading

While the benchmark crude oils play the key role in setting price levels for

almost all other crude oil trade � both spot and term-contract sales � most of

the trading in the marker grades is in some form of spread trading. The focus is

on arbitrage or price relationships rather than on outright prices. A typical

spread trade involves two parties taking opposite and partially offsetting posi-

tions that expose them to changes in relative prices rather than to changes in the

absolute price levels. The preference for spread trading reflects a natural reaction tothe volatility that is common in international oil markets. Spreads reduce the risk that isinherent in an outright position because the relationships between prices tend to be lessvolatile than absolute price levels. The heavy use of spreads also reflects the need of themarkets to constantly adjust a complex set of intermarket relationships to large priceswings. The reliance on price linkage to benchmark grades also tends to promote spreadtrading, as does the character of most market participants. Traders, oil refiners, and finan-cial firms are often more concerned with relationships between markets than with theabsolute price, which is the primary concern of producers.

About 50%-65% of the trading in the 15-day Brent market and over 90% of the

trading in Dubai is spread trading. Similar proportions of spread trade also seem

likely to exist in WTI and Brent futures, although because of the way that these

markets are structured, with a central clearinghouse handling all transactions,

the volume of spreads activity is hard to measure. The New York MercantileExchange is particularly conducive to spread trading because it allows refiners and oth-


ers to take offsetting positions in the crude oil and refined products markets, mimickingthe economics of refining with a �crack� spread. According to an analysis of PetroleumArgus data on spot crude oil deals, the volume of spreads trading in the 15-day Brentmarket increased steadily in the late 1980s and early 1990s reaching as much as 80%,with an even-sharper rise in the Dubai market. However, in the case of Brent at least,the proportion of spread deals has declined since 1993, but this may also reflect a migra-tion of this spread trading activity to the Brent futures market.

There are two basic spreads that are widely traded in the international spot

markets: Forward spreads and intercrude spreads. Forward spreads account for

most of the activity and essentially involve trading the relationship between dif-

ferent delivery periods. Such deals are also known as straddles or intermonth

spreads. They involve judgments about the premium (contango) or discount

(backwardation) that is likely to exist in forward prices. A �bull� spread involvesthe purchase of a near month and the sale of a forward month to take advantage of anupward move in absolute prices, which tends to widen the backwardation in the forwardmarket. A �bear� spread, the sale of a near month and the purchase of an outer month,is exactly the reverse. Several factors determine these forward price relationships in addi-tion to the overall direction of absolute prices. Levels of inventories, storage costs, as wellas future price expectations all play a role.

Only a handful of intercrude spreads are heavily traded, although in theory

they could be set up between just about any pair of crude oil grades in the world.

Brent relationships to WTI and Dubai are the most actively traded intercrude

spreads. The Brent-Dubai spread is commonly used to hedge or take positions on therelationship between sweet and sour crude oils, while the Brent-WTI spread reflects dif-ferences between the US and European markets. While spreads are usually viewed as lessrisky than outright positions, intercrude trades can be relatively more dynamic because ofwidely different market pressures. For example, the tendency of WTI to disconnect itselffrom international markets has, at times, produced wider swings in the Brent-WTI spreadthan in either price by itself. And in percentage terms, the swings can be much wider.

In addition to these basic spreads, there are any number of more sophisticat-

ed variants. A �box� spread is a set of four deals that essentially is a spread on a spread,or the relationship between two different crude oil price relationships, e.g., Brent-WTIversus Brent-Dubai. Others include the crack spread mentioned above, reflecting a sim-plified refinery relationship between crude oil and products.

The Structure Of Spot Markets

The benchmark grades, the prevalence of spread trading, and the heavy

reliance on pricing links to the marker grades together provide the basic struc-

ture of the world�s spot crude oil markets. The basic architecture is essentially

one of relationships. Paper barrel trading in forward and futures markets now

plays the central role in price formation and discovery, with a complex web of

interlinkages connecting various submarkets for physical spot supplies with the

more active and increasingly dominant paper barrel markets. Spot trading of wetbarrels is largely in the shadow of forward and futures markets, with most of the focuson defining price relationships to marker grades. But ironically, the wet barrel marketsfor spot grades, such as dated Brent and Dubai, remain highly important because of therole that they play in setting term-contract price levels. Just as the wet barrel markets


depend on paper barrel trade for a large element of price discovery, the forward andfutures markets also depend on one another and interact constantly. No single tradingcenter drives or dominates the international spot crude oil market, and no one marketor price captures a complete picture of it. Rather, it is the interplay of all of the variouselements that provides the overall result and direction.

Nymex Crude Futures(WTI)

IPE Brent Futures

OptionsSwapsOptionsSwaps

WTI Sphere Brent Sphere Dubai Sphere Asia-PacificSphere

15-Day Brent

Dated Brent

Dubai

ForwardDubai

Tapis

Spot

Futures

Forward

Spot Marker

Relationships

Direct

Indirect Or Partial

Swaps &Derivatives

Other

Medit-erranean Grades

Gov�t-SetMonthly Contract Prices

APPIPrice

Service

TapisSwaps

OmanQatar UAE

OtherNorth Sea

GradesRussian

Oil Indonesia

Austal-asia

African Grades

CashWTI

LatinAmericaOther

US/Canada

CFD

THE MAIN CRUDE OIL MARKETS

Paper barrel purchases account for the vast majority of transactions, out-

numbering physical crude oil deals by a ratio of more than 10-to-1 worldwide.

However, a vast amount of this paper barrel trading is internal to these markets due tothe heavy emphasis in both the Brent and WTI markets on forward spreads. This trad-ing helps to make these markets highly liquid and enhances their ability to generate con-stant price signals. On the other hand, the physical markets, despite their smaller vol-umes, provide a discipline and, at times, a counterweight to the churning volume of trad-ing in paper barrel markets that helps to keep them in touch with the genuine supplyand demand fundamentals.

Despite the importance of these linkages and the high degree of interdepen-

dence between markets, world spot crude oil trade divides quite naturally into

four spheres � WTI, Brent, Dubai, and Asia-Pacific. The two Atlantic Basin market

areas, the WTI and Brent spheres, are by far the most active and also involve a much


higher degree of integration between paper barrel trading and physical spot markets thanthe two spheres of trading East of Suez. In fact, the Dubai and Asia-Pacific spheres are,at times, heavily dependent on the price signals coming from the Atlantic Basin � fromthe Brent market in particular. The diagram on pB26 provides a sense of the structure andrelative mix in these markets between paper barrel and wet barrel activity.

The lack of visible forward and futures markets to lean on for price signals and

the inherent lack of liquidity East of Suez probably makes the Dubai and Asia-

Pacific spheres less efficient than the Atlantic Basin. The Asia-Pacific sphere is themost adrift and relies on a combination of alternative price signals from the AsianPetroleum Price Index and government-set monthly contract prices for basic indicators. Inthe Dubai sphere, the retroactive prices set monthly by state Adnoc for Abu Dhabi crudeoils, by state Qatar General Petroleum Corp. for Qatar crude oils, and by Oman�s Ministryof Petroleum and Minerals (MPM) for its crude oil draw heavily on Dubai price quotes forthe past month, but they do not come from a strict formula, except in the case of Qatar. Itis in this indirect way that the spot prices for these Mideast crude oils are linked to Dubai.

Despite their similarly high levels of activity, the WTI and Brent spheres have

quite different personalities, too. The Brent sphere is more heavily oriented

toward international physical trading, while the WTI sphere is the primary paper

barrel market. Although the volume of transactions in the WTI sphere exceeds the

trading in the Brent sphere by about 50%, it is almost entirely in the futures mar-

ket. By contrast, the Brent sphere, which includes physical trading in all European,Mediterranean, and African crude oils, accounts for about 65% of physical spot marketactivity worldwide. Less than 10% of physical spot trading occurs in the WTI sphere, butover 65% of worldwide paper barrel trading occurs in the Nymex crude oil futures mar-ket. These different personalities tend to make the two regions complementary.

Beyond the various benchmark grades that have been described above and

account for most of the trading, there are some 50 crude oils that appear regular-

ly in physical spot markets around the world. A profile of both the benchmark

crude oils and these other regularly traded grades appears on pages B28-B29, with

estimated volumes of reported transactions and the pricing basis for each one. Inaddition to these regularly traded crude oils, there are perhaps another 40 or so that comeonto the spot market less frequently. The market activity listed in the tables adds up to atotal volume of 4.2-million b/d in wet barrel spot trading. In addition, the volumes of trad-ing for some of the crude oils probably exceed the amounts shown because the price-reporting services are unable to track all of the deals that are done. Thus, the 4.2-millionb/d volume level in the table reflects only an estimated 50% or less of the total volume ofspot trade. A similar understatement may exist for the Brent and Dubai forward markets.Despite these limitations, the figures below help to provide a clear idea of the market link-ages and relative magnitudes of the markets in individual crude oil streams.

Ultimately, the international spot crude oil market can only be understood as

a broad set of relationships, with trading activity constantly seeking to define

those relationships. But this reliance on market linkages also means that the

physical spot crude trade that anchors most of the transactions represents a

small fraction of the total volume of trade. As we have seen, this can pose prob-

lems for spot markets. A very similar system of linkages has emerged for most

term-contract supplies, and as we will see in the following chapter, it has also

brought significant risks and rewards along with it.


SPOT, FORWARD, AND FUTURES MARKETS FOR KEY WORLD CRUDE OILS IN 1996

BRENT SPHEREMarket Reported Estimated Pricing

Brent Complex Country Type Transactions Vol. (b/d) BasisDated Brent UK Spot 28/month 465,000 15-Day Brent/WTI15-Day Brent UK Forward 200/month 3,300,000 Outright priceIPE Brent Futures UK Futures 65,000/day* 43,300,000 Outright price

Europe/MediterraneanForties UK Spot 20-25/month 375,000 Dated BrentFlotta UK Spot 2-3/month 40,000 Dated BrentEkofisk Norway Spot 10-15/month 210,000 Dated BrentStatfjord Norway Spot 5-15/month 165,000 Dated BrentOseberg Norway Spot 20/month 335,000 Dated Brent/WTIGullfaks (AB) Norway Spot 3-5/month 65,000 Dated BrentSiberian Light Russia Spot 1-2/month 25,000 Dated BrentUrals Russia Spot 20-25/month 375,000 Dated Brent/WTIEs Sider Libya Spot 0-1/month 5,000 Dated BrentSuez Blend Egypt Spot 0-1/month 5,000 Dated BrentSaharan Blend Algeria Spot 0-1/month 5,000 Dated BrentSyrian Light Syria Spot 1-2/month 25,000 Dated BrentIran Light Iran Spot 1/month 15,000 Dated BrentIran Heavy Iran Spot 2-5/month 50,000 Dated Brent

AfricaBonny Light Nigeria Spot 2-5/month 70,000 Dated Brent/WTIBrass River Nigeria Spot 5/month 115,000 Dated Brent/WTIEscravos Nigeria Spot 3/month 70,000 Dated Brent/WTIQua Iboe Nigeria Spot 5/month 115,000 Dated Brent/WTIForcados Nigeria Spot 5-7/month 140,000 Dated Brent/WTIBonny Medium Nigeria Spot 1-2/month 35,000 Dated Brent/WTICabinda Angola Spot 5/month 115,000 Dated Brent/WTIRabi Gabon Spot 1-2/month 35,000 Dated Brent/WTITotal Brent Sphere 49,455,000

Paper 46,600,000Wet 2,855,000

WEST TEXAS INTERMEDIATE SPHERE

Market Reported Estimated PricingWTI Complex Country Type Transactions Vol. (b/d) BasisWTI Cash Market US Spot 12/day 30,000 Outright priceNymex Light, Sweet

Crude Contract (WTI) US Futures 150,000/day* 100,000,000 Outright price

AmericasAlaskan N. Slope (Calif.) US Spot 4-6/month 65,000 WTIWTS, LLS, And Others US Spot 12/day 30,000 WTICano Limon Colombia Spot 1/month 20,000 WTICusiana Colombia Spot 2/month 40,000 WTIOriente Ecuador Spot 0-2/month 20,000 WTIArgentina Crudes Argentina Spot 1/month 20,000 WTITotal WTI Sphere 100,225,000

Paper 100,000,000Wet 225,000


SPOT, FORWARD, AND FUTURES MARKETS FOR KEY WORLD CRUDE OILS IN 1996 (cont.)

DUBAI SPHEREMarket Reported Estimated Pricing

Dubai Complex Country Type Transactions Vol. (b/d) BasisDubai UAE Spot 12/month 200,000 Forward DubaiForward Dubai UAE Forward 60/month 1,000,000 15-Day Brent/OutrightMurban UAE Spot 5/month 90,000 AdnocLower Zakum UAE Spot 5/month 90,000 AdnocOman Oman Spot 15-20/month 335,000 MPMQatar Grades Qatar Spot 3-4/month 75,000 QGPCTotal Dubai Sphere 1,790,000

Paper 1,000,000Wet 790,000

ASIA-PACIFIC SPHERE

Market Reported Estimated PricingCrude Oil Country Type Transactions Vol. (b/d) BasisTapis Malaysia Spot 3-4/month 60,000 Outright/APPITapis Swaps Malaysia Swaps 50/month 400,000 Outright/APPILabuan Malaysia Spot 0-2/month 15,000 Outright/APPIMinas Indonesia Spot 6-8/month 115,000 ICPWiduri Indonesia Spot 1-2/month 25,000 ICPDuri Indonesia Spot 1-2/month 25,000 ICPKutubu Papua NG Spot 2-3/month 40,000 APPI/TapisAustralian Grades Australia Spot 0-2/month 20,000 APPI/TapisTotal Asia-Pacific Sphere 700,000

Paper 400,000Wet 300,000

Worldwide TotalsTotal Volume 152,170,000

Total Paper 148,000,000Total Wet 4,170,000

This list of crudes is not comprehensive, but it does cover all of the most actively traded grades. Reported transac-tions data are drawn from Petroleum Argus, other market-reporting services, futures exchanges� volumes, othersources, and PIW estimates. Transactions outside of futures markets may understate the actual level of trading in somecases. *Per trading day.

CRUDE OIL HANDBOOK PIW © C1

TTEERRMM SSAALLEESS ��

CCoonnssttaanntt EEvvoolluuttiioonn TTrraannssffoorrmmss TTeerrmm CCoonnttrraaccttss

Given the heavy reliance on spot-linked pricing for just about all crude oil sup-

plies, the traditional distinction between single-cargo spot transactions and

longer-term contract supply arrangements might understandably be viewed as

largely theoretical. Indeed, almost all of the historical trappings of a term con-

tract for crude oil have been progressively stripped away. The different values of

term and spot deals can often be measured in pennies a barrel, and thus the dif-

ferences in prices from the perspective of both buyer and seller are sometimes

trivial. Today�s term contract for crude oil is almost unrecognizable from its evolution-ary ancestor in the late 1970s, which provided the buyer with fixed volumes for a fixedperiod at the same government-administered fixed price to all customers at the port ofloading. If a buyer failed to lift crude oil as and when the contract indicated, it was sub-ject to penalties. The buyer was willing to endure all of this for security of supply. Underthe current system, both the duration of the contract and the volumes involved havebecome increasingly flexible and, in practice, can be adjusted almost at will, with buy-ers often allowed to take spot volumes over and above term supplies on a virtually indis-tinguishable basis. And with pricing linked to the spot market and at times customizedfor individual buyers, the term contract might be considered just a regularized or recur-ring set of spot deals structured to the needs of the individual buyers.

Despite the growing similarities to spot deals, term contracts are still special

and they fulfill important functions, which explains why they have accounted

for a growing share of the international crude oil trade in recent years. The hall-

mark characteristic of term-contract supplies that distinguishes them from spot

deals is the more lasting relationship they represent between buyer and seller

and the operational predictability and simplicity that this provides to both. By

definition, a term contract defines either complementary or mutually advanta-

geous conditions for both buyer and seller, providing each with a degree of pre-

dictability. And, while the benefits may be skewed more in favor of one than the

other party, in all cases term contracts provide sellers with relatively secure mar-

kets and buyers with relatively secure sources of supply. In either case, the buyeror seller sees a distinct benefit in having an enduring relationship rather than a series offlexible but unpredictable spot transactions. Contracts break down when conditions pre-vail in the marketplace that make the costs of maintaining the contract too dear for oneparty or the other. Thus, the term contracts of the late 1970s and early 1980s were basedon fixed prices, administered by governments, and imposed on an f.o.b. basis at theports of virtually all oil exporting countries. These contracts were regarded as tilted infavor of the exporter, which set the price at its export terminal. The risks of any pricechange between the time a cargo was lifted and then imported at the terminal of a refin-ery were borne by the buyer. However, after the Iranian revolution began to unfold in1979 and 1980, oil prices started to escalate, and the risk borne by buyers turned into anadvantage, since the price of a cargo could increase rapidly from the time a vessel leftan export terminal until the time it reached an importer�s harbor. As a result, exporters

C2 PIW © CRUDE OIL HANDBOOK

began to break their contracts unilaterally and sell their cargoes on an auction basisbecause the terms of fixed price contracts became increasingly adverse to them.

When the term-contract regime of the 1970s and early 1980s broke down

and the spot market mushroomed, a period of uncertainty emerged in which

buyers and sellers found it difficult to forge mutually beneficial ties and the

ultimate underpinnings of trust between them were fractured. Beginning in1981, after term-contract prices reached their peak, the seller�s market of the 1970squickly gave way to a buyer�s market. The oil exporters, which first broke contractsanctity in the late 1970s when oil prices were escalating, found themselves in greatdifficulty when they tried to insist that buyers adhere to fixed terms again. This timethe buyers, facing the greater likelihood of falling than of rising prices, saw no reasonto rush back to the sellers and their fixed terms. The buyers argued that these contractshad little value, predicting that the sellers would again break contracts anyway if oilprices resumed their earlier upward path.

Successful Term Contracts

Successful term crude oil supply contracts fulfill the purpose of defining risks,

and there are three basic risks that any enduring contract needs to address sat-

isfactorily for both the buyer and the seller. Two of these are market risks, and

one pertains to prices. The market risks relate to security of sales, or markets, for

sellers and security of delivery, or supply, for buyers. The contract provides aframework of understanding for buyer and seller, defining either narrow or broad limitsof tolerance for each side as well as mechanisms for resolving disputes that may arise.In today�s buyers� market, the seller is forced to absorb many of the risks and uncer-tainties and give the buyer the virtual equivalent of a spot deal in order to retain somecontinuity of liftings. And the buyer also has definite advantages in the form of pre-dictability and manageability that make attractively priced term deals more appealingthan the spot market, where supplies of desired crude oils can be more erratic and alarge trading operation is needed to constantly manage supplies.

The third key element of contracts relates to the timing of when prices are trig-

gered. To the degree that it takes time to deliver crude oil from an export terminal to theflange of the importing terminal, so price risk is borne by either the buyer or the seller.As we will see below, a critical issue thus becomes whether pricing takes place at or closeto loading � thus placing price risk on the shoulders of the buyer � or whether it istriggered at or close to unloading � thus placing price risk in the hands of the seller.

The most important issue that the contract must deal with is that both par-

ties have confidence that over time the price terms represent something close

to the ultimate value of the particular stream of crude oil. And if that condition

turns out not to be the case, the contract will not have much durability. Fair rep-

resentation of the value of the crude oil in the marketplace provides the ulti-

mate test for any crude oil contract. As a raw feedstock, crude oil commands novalue per se. Its value is almost entirely a function of what becomes of it after it isprocessed into a slate of petroleum products (see Chapter E: Refining). Thus a crudeoil�s quality is a key element of its value. To the degree that it can be processed morereadily than other crude oils into higher value products such as gasoline, diesel fuel,and jet kerosine, it will command a higher value than other streams of crude oil thatmore readily yield lower-quality middle distillates or residual fuel oil. Beyond quality,


the other key element in the value of a particular stream of crude oil is the distancebetween its source and the end-user market where it is refined. Since the value of crudeoil is determined by local market conditions, transport costs to that market play a criti-cal role in its price (see Chapter D: Logistics).

Growth In Term Contracts

Although comprehensive data are scarce, the available evidence suggests a clear

expansion in term-contract sales during the 1990s even as spot activity has also

grown with rising global oil trade. PIW�s annual tallies of term contracts are the

only global measure of these sales. They track all known term contracts for the

leading international exporters and show them rising from 40% of the total pro-

duction of these countries in 1989 to almost 55% in 1995. In volume terms, they havegrown to about 15- to 16-million barrels a day in 1995, according to the PIW tallies (seeChapter G: Trade). Some of these term supplies are subsequently resold into spot markets,but this volume was initially sold under term contracts. The term contracts tracked by PIWalso exclude smaller term sales by some international oil company equity producers.

One of the difficulties that PIW has encountered in tracking term contracts is

the large number of gray areas that lie between deals that are clearly either spot

or term. These ambiguities make the classifications somewhat arbitrary at times andrequire that the crude oil sales of an exporter or the purchases of a company be viewedas a totality. These uncertainties are examined below, and the individual marketingstrategies of key exporters, both spot and term, are described in detail in the referencesection (see Chapter F: Country Profiles).

A Brief History Of Term Pricing

Although term-contract sales have staged a comeback, they are unlikely to

regain the absolute dominance of international crude oil commerce that they

enjoyed prior to 1979-80, when they accounted for 95% or more of all supplies.

Spot transactions have become standard practice for most sales in the North Sea and forsome other individual crude oils such as Dubai (see pH87), and because of the com-petitive pressures of these markets there seems little alternative to this type of marketingfor these oils. By contrast, up until the Iranian revolution, term contracts and equity sup-plies accounted for almost all deals, despite the 1973 oil embargo and the nationaliza-tion of international oil company assets in many of the producing countries. Oil compa-nies had little choice because of the scarcity of alternative supplies. The Opec produc-ers simply adopted a slight variant of the posted pricing system of the major oil compa-nies when they began to set rates unilaterally in 1973-74, and this system worked rela-tively smoothly until the second oil shock in 1979-80. At that point, as in 1973-74, spotprices were being pulled up by demand so rapidly that governments could not makeadjustments in official prices quickly enough. Furthermore, government after governmentunilaterally broke contract arrangements in order to sell into the more profitable spotarena, undermining the supposed benefits of term supply arrangements. At one point,the former Aramco partners were nearly alone in lifting contracted crude oil at set prices,earning the so-called Aramco advantage.

As is the case today, during the heyday of crude oil contracts, the prices of

virtually all crude oils sold were based on a differential to a marker grade. In

the 1970s, most crude oils were sold at official selling prices, sometimes also


called government selling prices, which in turn were set according to differen-

tials to a single crude oil � namely, Saudi Arabian Light (see pH227). All otherOSPs in Opec were set in reference to the marker, depending on differences in phys-ical properties of the grades and distances to the markets. And, outside of Opec, theprices of virtually all other export crude oils were also based on administrative fiat inreference to the Saudi marker.

By 1984-85, the official price system, which was the basis for most term con-

tracts, was in a shambles. Buyers found that the strict terms resulted in unac-

ceptable market risks and that security of supply, which was supposed to be the

main benefit of the contracts, was unnecessary in the face of a global supply glut.

They were also leery of the suppliers, whose reputations for reliability were tar-

nished severely when some unilaterally cut off their buyers during the earlier

rising market. Many buyers opted for big increases in spot supplies and a host of othercrude oil-purchasing arrangements offered by various countries in order to get aroundthe objections of buyers to the rigidities and burdens of term supplies under the officialprice system. Many of these alternative marketing methods are still in use, and they serveas a source of the gray areas that now exist between pure term and pure spot arrange-ments. Saudi Arabia, which had remained the most committed to the official price sys-tem as it played the role of Opec swing producer, saw its output plummet by mid-1985to unacceptably low levels of less than 2.5-million b/d.

The response of Saudi Arabia to this untenable market predicament was to

establish the netback pricing system in late 1985, which abandoned official

prices completely and tied the value of crude oil directly to the spot market

prices of the resulting products. Netback pricing, from a buyer�s perspective, is

the most attractive mechanism that can be developed for two reasons: It prices a

crude oil stream according to its �real� market value (see Chapter E: Refining);

and it locks in a profit margin for refiner/buyers. Not surprisingly, this attractive

market-linked pricing system was designed to rebuild Saudi market share, in

which it succeeded splendidly but it also sparked a huge price decline in 1986.

Netbacks quickly became the rage in Opec as producers competed for customers in thedeclining market and just as quickly fell from favor as Opec tried to restore some orderto the market in late 1986. Rightly or wrongly, netbacks were blamed for the price crashand they still carry a stigma as a result of it. Despite their brief period of dominance ofonly about one year, netbacks represented a revolutionary shift to spot-market-linkedpricing and the tacit admission by crude oil sellers that in order to remain competitive,term contracts needed to be taking their cue from spot markets.

The netback pricing system was followed by a brief, unsuccessful return to

fixed official prices and in late 1987 by the system of geographically-specific for-

mula prices tied to spot crude oil price indicators or markers. This system of for-

mula prices is still in place today. Unlike netback prices, which were based on spotproduct markets and assured refiners a guaranteed margin, the spot crude oil-linked sys-tem was a more direct reflection of the existing price situation in global spot crude oilmarkets, which made it safer and somewhat more conservative. It also permitted sellersto target specific areas and even specific customers by modifying formulas and otheraspects of the contracts to meet customer�s individual needs. Ultimately, these adjust-ments have resulted in contracts that in many cases are tailored to individual companies.This furthers the goal of the producer, which is to lock in market outlets and achieve


security of demand. However, the use of tailor-made formulas also reduces the trans-parency of pricing, making it harder to compare the relative cost of supplies. PIW�s PriceScorecards have emerged as the only regular third-party assessment of the absolute levelof term-contract prices implied by the formulas (see Chapter I: Prices).

Formula pricing has proven to be effective as a tool for establishing and

defending market share by producers in a period of surplus supplies and com-

petition. It has also proved to be flexible and quite durable, but as will be seen

below, it is not without its problems, particularly with regard to spot market

benchmark reference crude oils. Just as pricing of term supplies became more attrac-tive to buyers in the 1980s, volume and time commitments were also loosened. The oldsystem of annual evergreen, or renewable, contracts for set volumes gave way first toreleasing customers from underlifting penalties. Buyers were also given more latitude tocancel liftings, provided that they gave adequate notice, and to change volumes quar-terly, or even monthly. At the extreme, countries such as Iran and Venezuela allow somecustomers to review price terms and volumes on a cargo-by-cargo basis, providing quasi-spot market flexibility.

Market-Related Formula Pricing

The market-related formula-pricing system is most prevalent in the Atlantic

Basin, but it is also used by large Mideast producers such as Saudi Arabia, Iran, and

Kuwait for crude oil sales to Asian customers. The key market link in all formulas

is the benchmark spot crude oil grade that is used to drive or determine the final

price. Simple crude oil linkages to a single benchmark grade are widely prevalent

in markets where a benchmark crude oil predominates, such as the Brent marker

in Europe and West Texas Intermediate in the United States (see pH241,H257). PIW�sCrude Oil Price Scorecard regularly tracks these linkages and changes in the adjustmentfactors while also calculating the resulting prices for a particular crude oil, such as SaudiArabia Light, which is based on Brent in sales to Europe or West Texas Intermediate insales to the United States (see Chapter I: Prices). The quality of the marker need not besimilar to the crude oil being sold. The key attribute of the marker grade is that it providea clear price signal. It is for that reason that Mideast and Latin American producers tie theircrude oil prices to WTI in the US, even though their sour crude oils are not directly com-petitive with the US sweet crude oil marker grade. WTI completely displaced AlaskanNorth Slope crude oil (see pH251) as the benchmark grade for sour crude oil sales in theUS in the 1993-95 period as trading in Alaskan North Slope dried up on the Gulf Coast withdeclining production and the subsequent lifting of US export restrictions in 1996.

Tying a country�s term-contract crude oil prices to a more widely traded and

quoted crude oil stream is attractive in that it links a crude oil stream that may

not be widely traded to one which is. This enhances price transparency. The

system works best if the underlying qualities of the two crude oils are similar.

If that�s the case, the linkage provides a number of advantages. Primary amongthese is that a system of linkage is fairly easy to administer in a uniform and consistentmanner. Another advantage is that crude oil linkages are highly responsive to changingmarket conditions, thus facilitating the development of long-term offtake arrangementswith refiners. Ideally, the linkage should make the refiner indifferent to whether it isbuying the more widely-traded benchmark grade or the linked grade, thereby facilitat-ing its long-term commitment to purchase the exporter�s crude oil. Hedging of term-


contract supply by the refiner is also facilitated because of the ready availability of for-ward or futures markets for the benchmark grade. The bottom line is that the risks tothe refiner of term crude oil purchases are virtually eliminated. Even when the qualityof the crude oil varies significantly from the benchmark, responsiveness in setting pricedifferentials can help offset much of the potential risk, giving the buyer much the samekind of low-risk term-contract relationship.

Whether a simple crude oil linkage to a benchmark grade ties together the

prices of two similar or dissimilar grades of oil, this sort of tie can also carry a

number of disadvantages, which make such linkages less than wholly satisfacto-

ry. Differences in quality can cause distortions in crude oil values that are not

always fully addressed by changes in adjustment factors. Simple linkages may

also facilitate retrading of a country�s crude oil stream, which implies that theexporter is not maximizing value for the crude oil in question. In the case of largeMideast producers such as Saudi Arabia, there is a trade-off between the advantagesassociated with simple linkages and the disadvantage of spot reselling. The big advan-tage is that this simplicity helps to move huge quantities of crude oil by creating a sys-tem that is easier to administer. What�s more, unlike some of its Mideast competitors,Saudi Arabia has largely prohibited spot resales of its crude oil by making such transac-tions contingent on its approval. But, because of its status as a preferred baseload sup-plier, Saudi Arabia has the necessary clout to enforce this.

Another frequent disadvantage of simple crude oil linkages is that they tie the

value of a crude oil to the peculiar characteristics and special market circum-

stances of a benchmark grade that may at times be out of line with overall mar-

ket trends. In the case of Alaskan North Slope crude oil, which was used as a sour-crude oil benchmark on the US Gulf Coast until the mid-1990s, the lack of liquidityresulted not only in marked price volatility for the benchmark as well as the crude oilslinked to it, but also market squeezes and other phenomena that can distort the price ofthe crude oil and cause buyers and sellers difficulties. The most popular benchmarks, UKBrent and West Texas Intermediate, also suffer from similar periods of stress when theyare out of sync with overall market tendencies due to local circumstances (see pB9,B15).

Use of crude oil baskets involving more than one benchmark grade is a fre-

quently-used alternative to simple crude oil linkages with a single marker. Unlike

the simple linkage, a crude oil basket can, at least in theory, reduce some of the

disadvantages of reliance on a single marker that may be susceptible to peculiar

market changes and localized circumstances. The most widely-used multiple linkageis found in Mideast crude oil exports to Asia-Pacific markets. The common formula forMideast sales averages the spot prices of Oman and Dubai grades and adds an adjust-ment factor, which is positive for lighter grades, such as Saudi Light, and negative forheavier grades. The use of two markers in theory eliminates some of the volatility asso-ciated with use of a single marker link. In practice, however, the use of an average ofDubai and Oman grades stems from the lack of a more satisfactory marker for sales tothe Far East. Unlike Europe and North America, the Asia-Pacific region lacks a widely-traded and locally-produced crude oil that can serve as an appropriate benchmark forsales from afar. The Dubai-Oman link also is not entirely satisfactory because spot tradein Dubai, and indirectly Oman, are influenced by Brent (see pB19).

Complex market basket pricing, involving the average prices of three or more

crude oils or of several crude oils modified by the averages of specific products


come much closer than other simple formulas or crude oil baskets in represent-

ing the �true value� of a specific stream of crude oil to refiners. That�s because

they come closer to replicating the �netback,� the value of the crude oil as

processed into a spectrum of petroleum products. Mexico and Venezuela are pre-

eminent in using these more complex market basket pricings as the basis of their

sales formulas. The clear advantage of basket pricing is that it is specifically designedto reflect overall market conditions better than simple linkages, thus reducing pricevolatility and disparities. As a result, these formulas also capture more of the total �rents�of petroleum than less complex formulas, especially at times when the relative differencebetween crude oil and product prices diverge greatly. But they are not available to allexporters. Their construction and maintenance requires a fairly sophisticated crude oilmarketing operation and close ties between seller and buyers to work properly.

Making Formula Prices Work

It takes more than a linkage, whether simple or complex, to one or more

benchmarks to have a formula pricing system. While the adjustment factor is

applied to account for quality and locational differences, other elements of the

pricing mechanism take into account a variety of aspects of market risk. Thus, to

avoid the risks of extreme volatility on a single day, an average of spot prices is

normally embodied in the formula, usually over a five- to 10-day period in the

market-responsive Atlantic Basin and a monthly average for Asian destinations.

The adjustment factors, which are sometimes referred to as constants despite the fact thatthey usually change monthly, are usually set by the producing country. Changes reflectthe market pressures on the crude oil, with tighter terms applied when markets are per-ceived to be strong, either in absolute terms or relative to the benchmark grade, andlooser terms applied in a weakening market. The amount that term-contract customersare willing to lift in a given month often depends on whether the changes in the adjust-ment factors are viewed by buyers as fair. A country that is trying to expand its sales vol-ume and markets tends to undercut others by offering more-attractive terms. However,tracking the relative competitiveness of crude oil grades to each other or the spot mar-ket is difficult because of the quality differences between grades and the complexity ofthe formulas themselves.

While the formulas can be either for f.o.b. sales at the port of loading or for

delivered sales to the refiner�s local market, a key element of most of them is to

reduce the time risk to the buyer of price changes during the voyage to the refin-

ery, which can take as much as a month and a half for shipments from the

Mideast to the US Gulf Coast. The end result is that distant suppliers are able to

compete for customers on an almost-equal footing with short-haul producers

selling spot barrels. This innovation, which was originally part of netback pricing aswell, allowed key Mideast producers to diversify their client bases and adjust sales termsgeographically in various markets in order to optimize volumes in each area. This abili-ty to discriminate between markets helped producers to compete with one another whilealso allowing them to maximize volumes and revenues in a chosen region. From a buy-ers� perspective, formula pricing has been attractive because it presents them with awider choice of feedstocks at prices that are guaranteed to be competitive.

The price can, in theory, be triggered at any point between the wellhead,

where crude oil is produced, and the refinery gate or rack, after a crude oil is


AAnn EExxaammppllee OOff HHooww AA FFoorrmmuullaa PPrriiccee IIss DDeetteerrmmiinneeddAn example of a typical formula price sale might involve a major oil company takingArabian Light (see pH227) from Saudi Aramco under a term contract in May 1996 andbringing that crude to a refinery in Rotterdam. The entire price-determination processtakes around two and a half months, which is about the longest of any term-contractformula. The process would have started at the beginning of April, with Saudi Arabianotifying its customers of the relevant adjustment factors versus the dated Brent bench-mark that would apply for May liftings � minus $1.30 a barrel in the case of European-bound Arabian Light. The major would then inform state Saudi Aramco of its liftingintentions, including the amount that it might want to take over or under its term-con-tract volume. Depending on availability, the quantities would be worked out with SaudiAramco and the loading schedule for May would be set. If, for example, the European-bound cargo loaded on May 6, it would arrive in Rotterdam about 40 days later � June15 � via the Cape of Good Hope route, at which time the pricing mechanism wouldbe triggered. The formula calls for a 10-day average of dated Brent prices starting fivedays before the trigger date, implying a benchmark level of $18.64 a barrel at that time.The adjustment factor of $1.30 a barrel would be deducted from this market level, aswould a small 24¢ a barrel downward adjustment for freight costs that are above theWorldscale 40 base rate, to arrive at the final price of $17.10 a barrel.

It is important to note that the price terms for this cargo were established a monthbefore lifting, but the final price was not apparent until 45 days after the cargo loaded.

SAMPLE TIME LINE OF SAUDI FORMULA PRICE CRUDE OIL SALE

Saudi Aramco May volume Cargo Voyage to Cargo arrivessets price and loading loads in Rotterdam and price isdifferential schedules Saudi Arabia triggered 40 days

for May set after loading

April May June July

fully processed into a range of products and ready for sale to distributors and

final consumers. For Mideast crude oil sales to the US Gulf Coast this time peri-

od amounts to some 75 days. Modern term contracts thus have a critical tim-

ing dimension, whereby the transfer of ownership of a crude oil cargo � or

even a partial cargo � can differ significantly from the time when the cargo is

priced. The locational differential of the value of crude oil relates to the costs of mov-ing the crude oil from its export terminal to the refining center, including freight, insur-ance, shrinkage or loss, customs fees, port charges, and the time value of money. Thevaluation process of a cargo also needs to take into account the risk that the marketvalue can rise or fall during the time period it takes to produce the crude oil, trans-port it and refine it into finished products. That risk is real and needs to be eitherabsorbed entirely by the buyer or seller, shared by the two, or laid off on some inter-mediary (see chart above).


A third critical timing element � above and beyond the distinction between

transfer of ownership of a cargo and triggering of its price � is fixing the point in

time at which payment will be effected. As in the case of triggering the price, this pointcan be at any point from the wellhead to the sale of retail products. None of these threepoints � transfer of ownership, triggering of price, or timing of payment � needs to occurat the same point in time as the others. Differences in their timing or occurrence in a trans-action relate in part to the parcel-ing of market risk. But the differ-ential sequencing of these threepoints also gives rise to otherrisks, including market and creditrisks, which also need to beshared by buyer and seller.Clearly, the closer the transfer oftitle and of risk of physical loss isto the point at which price is set,the less the amount of market riskthat must be carried by the seller.Similarly, the closer both of theseare in the sequences to the pointat which the buyer resells thecrude oil or resulting products, theless market exposure is faced bythe buyer. As is explained below,there are ways for buyers and sell-ers to minimize these risksthrough the use of crude oil deriv-atives, which involve transferringthe risks to others through futuresmarkets, swaps, or options (seepC13).

In addition to the basic

mechanics of price timing,

the benchmark grade, and

the adjustment factors, there

are sometimes other added

elements in the formulas that

seek to make them more

attractive to buyers or to pro-

vide a closer reflection of the

perceived market value for the crude oil. These include such things as freightadjustments, which guarantee buyers of long-haul grades � for example, those fromSaudi Arabia � competitive prices for f.o.b. purchases regardless of possible tightnessin the tanker market. These adjustments allow the producer to absorb potential extrafreight costs, thereby keeping its crude oils on an even footing with short-haul sup-plies into the same market.

Formula pricing has evolved in two seemingly contradictory directions since

THE 90-DAY DIMENSIONOF A MIDEAST CRUDE OIL SALE


1987, becoming simpler in some respects but also more complex as sellers strive

to meet closely the individual needs of specific buyers. The greater simplicity isreflected in the widespread use of just a few spot crude oil benchmarks and the nearlyexclusive use of f.o.b. transactions, except for the delivered sales by Saudi Arabia andKuwait to the US and by Saudi Arabia and Iran to Europe. Netback pricing, except forthe vestigial use by a few producers, such as by Nigeria in the late 1980s, has also beenalmost completely abandoned. However, sellers continue to offer special inducements tobuyers. These include extra barrels over and above contract volumes, which has at timesbecome standard for some Saudi and Iranian customers.

Retrospective Pricing

The retrospective pricing mechanisms for term-contract sales, which are used

by several countries in the Mideast Gulf and Southeast Asia to price their crude

oils, are essentially a variant of formula prices. Instead of the more market-

responsive formulas, they rely on a monthly average of some explicit or implicit

marker grade. The formula prices of the large Mideast producers to Asian markets

are quite similar in that they also rely on monthly averages. There are a number ofreasons for this price structure, which mainly reflects the buying habits of Japanese andSouth Korean customers. Especially important is the reluctance of these buyers to assumeprice risk on long-haul crude oils and their preference for long-term contracts, for whichthey are often willing to pay a premium. These arenas also have fairly thin spot markets,and the buyers in them have thus far shown a clear preference for uniformity: TheJapanese and South Korean refiners, which are the region�s largest crude oil buyers, tendto negotiate with producers as two large national groups, which results in the same pricesfor all buyers. In addition, the paucity of daily trading in a highly liquid spot market, espe-cially in a clearly representative and dominant benchmark grade, prompts buyers and sell-ers to look to the longer monthly period for establishing a pricing basis for term contracts.This longer-term view is abetted by the special relationships that exist between some gov-ernments in these exporting countries and the Far East lifters of their crude oils.

Pioneered by Oman, retrospective pricing has been widely used in Abu

Dhabi, Dubai, Brunei, China, and Mexico (for sales to Japan). It involves a com-

bination of a formula approach, based on indirect linkages to active spot mar-

kets, and a degree of subjectivity on the part of the producing country. The

range of retrospective pricing arrangements is illustrated by the implicit � but

never stated � linkage of Abu Dhabi�s term-contract pricing to the spot-market

value of Dubai crude oil and by the complex, but clearly defined, formula mech-

anism used by Indonesia. Since Abu Dhabi�s crude oils are mostly lower in sulfur andlighter than most other Mideast Gulf grades, their prices tend to reflect their higher qual-ity. But the monthly average of spot Dubai prices tracks closely with Upper Zakum, AbuDhabi�s lower-quality crude oil (see pH23). Since all of state Adnoc�s sales are to Asiancustomers, the quality adjustments tend to reflect Asian refining values. At the otherextreme, Indonesia�s pricing system is based on a basket of price quotes from the AsianPetroleum Price Index for a group of five Mideast and Asian crude oils. A rolling his-torical average of the differential between these five grades and the APPI spot priceassessment for that particular Indonesian grade is then applied to come up with the finalprice. While this mechanistic approach is clear and consistent for all buyers, it lacks thekind of flexibility to adjust to seasonal shifts in crude oil quality as in Adnoc�s system

or a monthly adjustment factor as used in a typical formula price. This rigidity has alsoforced Indonesia to sometimes make special adjustments in price terms for difficult-to-market grades such as Duri and Widuri (see pH119,H127).

Inevitably, a certain amount of subjectivity on the part of producers and trust

between buyers and sellers enters into retrospective pricing. The subjective ele-ments weighed by these countries include advice and information from local producers,buyers, outside consultants, surveys, and price reporting services. It takes fairly specialcircumstances for retrospective pricing to work, with a high degree of confidence on thepart of buyers, such as those in Japan and South Korea, and responsiveness on the partof sellers to shifting market circumstances. While retrospective pricing is meant to sim-ply track actual market values with a lag, in practice it lacks flexibility. Nevertheless, ithas proven to be an important way for some term contracts to deal with changing mar-ket circumstances.

Benchmark Woes

With just about all term-contract prices � formula or retrospective � tied

directly or indirectly to the same crude oil benchmarks that are used in the spot

market, world oil trade resembles a grouping of three inverted pyramids with

the basis for all price discovery found in these spot grades. As in the spot crude


DEPENDENCE OF TERM CONTRACTS ON SPOT BENCHMARKS

WTIAmericas

4.6-million b/d*

BRENTEurope

5.9-million b/d*

DUBAIAsia-Pacific

5.4-million b/d*

*1995 estimated volumes, based on listing of term contracts. Note: Areas indicate approximate sales volumes.

Saudi Arabia

Kuwait

Mexico

Venezuela Iran

Ecuador Indonesia

Syria Yemen Egypt Qatar N. ZoneColombia

Canada Libya Nigeria Abu DhabiArgentina Oman


oil market, the Brent pyramid is the biggest, but the large volume of crude oil mov-ing into the US gives added international importance to domestically-based West TexasIntermediate grade. Dubai and Oman are the main markers for Asia-Pacific term con-tracts, but since monthly averages are used, their benchmark roles are somewhat moreclear and direct than in spot crude oil trading.

As shown in the detailed discussions of these benchmark grades in the pre-

ceding chapter, all of these markers have flaws that call into question their dura-

bility or reliability for the important roles that they play in price formation. The

problem is that there are no viable alternatives at this point. As of 1996, AlaskanNorth Slope had completely disappeared as a marker grade and Dubai appeared to bethe most vulnerable because of its declining production. But spot trading in Dubai hasnevertheless flourished in the mid-1990s following earlier troubles. The well-establisheduse of WTI is also far from perfect because of its tendency to disconnect itself from inter-national arenas due to extreme internal domestic market pressures.

The diagram on page C11 illustrates the heavy dependency of term-contract

pricing on this handful of spot-market benchmark grades. Fully 5.9-million bar-

rels a day of term-contract-priced crude oil, or about 37% of global volumes

tracked by PIW, are directly dependent on Brent prices. And that doesn�t evencount about 3-million b/d of spot transactions that are also linked to Brent � a crudeoil stream of only about 500,000 b/d that has by far the biggest physical spot market ofany of the global benchmarks. The combination of Oman and Dubai benchmarks forterm-contract sales to the rapidly growing Asia-Pacific market provides the price signalfor some 5.4-million b/d in term contracts, making them almost as important as Brent,which it is also dependent upon. WTI provides the benchmark for about 4.6-million b/dof term-contract sales, all in the Americas.

The Many Gray Areas

A whole range of alternative crude oil marketing methods have developed

over the years. These variants all seek different ways to bridge the gap between

term-contract sales and single cargo spot transactions. They come and go in pop-

ularity depending on the tastes of buyers and the objectives of sellers, and they

also vary in complexity. The simplest and most straightforward are simply term

contracts in which the price and volumes are negotiated on a cargo-by-cargo

basis. Russia and Iran have traditionally been among the most regular users of

this type of hybrid term/spot contract, together with other, smaller producers, main-ly in Africa. This kind of pricing is also typical of test cargoes of new crude oils. Someproducers such as Iran also offer spot volumes to customers over and above term-con-tract commitments. Saudi Arabia does this as well, but it usually limits these to existingterm customers and insists on the prevailing delivered term-contract price rather thannegotiating a special spot price. A variation on this is called a �framework� contract,which can vary almost infinitely. At their simplest, they may grant a particular buyer theright of first refusal on a particular volume. More elaborately, the contract may specifyparticular pricing mechanisms. Such contracts are particularly popular for Russian Uralscrude oil (see pH221). The volume of crude oil sold under these quasi-spot contractsseems to have grown in the 1990s, and it could expand further with increased competi-tion among producers as Iraq returns to the international market.

Venezuela is also an active user of cargo-by-cargo sales, and the country has


employed them quite effectively to expand its US market share since 1993, while

abandoning its old, rigid system of posted prices. From 1992 to 1995, Venezuela�s

crude oil exports to the US jumped from 828,000 b/d to 1.26-million b/d, a jump

of about 50%, which is due to its marketing flexibility and its US downstream

investments. State PDV essentially allows buyers to use whatever type of pricing theyprefer. Customers opt for a wide variety of pricing terms, which they can renegotiatewith the Venezuelans pretty much at will. PDV usually builds in a time element thatadjusts the price according to an agreed-upon linkage to the spot market so that thebuyer is assured of an attractive price at the time of delivery. Prices can be based on spotcrude oil or product benchmarks, or on a fixed price. This has made it hard to discerna typical or average price for Venezuelan crude oil.

Prefinancing And Barter

There are other alternative sales mechanisms that are designed primarily to

lock in customers and maintain stable offtake by linking the contract volume to

some other financial or commercial transaction. Known as either prefinancing

deals or barter deals, they have become less popular than they were in the 1980s

even though pricing is at times highly advantageous to buyers. While they are

essentially term contracts, they are a special kind that binds the buyer and sell-

er more closely together because there is always an incentive on both sides to

keep the oil flowing in order to cover the cost of the loan or the barter arrange-

ment. Barter deals became especially popular in the early 1980s, when the Opec offi-cial pricing system was breaking down. They typically involve the exchange of a fixedflow of oil over time for a certain agreed-upon set of goods and services. Under currentdeals, such as the well-known Saudi purchase of military jets and equipment from theUK, the oil is priced at standard term-contract levels and the cash is used to pay for thegoods. The advantage of this to the purchaser over other contracts is that the producerdedicates a stream of sales to a deal and cannot cut back this volume without jeopar-dizing a separate commercial relationship that it values highly. Similarly, in prefinancingdeals, the producer usually receives money in advance for a set value of crude oil overa period of time that is discounted in price to allow for interest payments. This gives theproducer access to credit that it might otherwise have difficulty obtaining, and it providesthe buyer with attractively priced supplies with no fear of being cut back due to Opecquota reductions or other circumstances. In the case of Iran, buyers were also giventremendous freedom about when they can opt to lift their crude oil entitlements. In 1996,prefinancing deals have enjoyed something of a renaissance among cash-strappedRussian exporters and with some Latin American countries such as Ecuador.

Processing And Product Swaps

Closely related to barter deals are crude-for-product swaps and processing

arrangements, which, in some cases, can look a lot like netback sales. These

deals can be used to move hard-to-sell crude oil or to disguise heavy price dis-

counting, but they are also an attractive way for an oil exporter to meet domes-

tic needs for refined products that it is unable to satisfy itself. Iran, Indonesia,Nigeria, Malaysia, China, Saudi Arabia, and Kuwait have all actively used these mecha-nisms at different times. Under a crude-for-product exchange, a certain agreed-upon vol-ume of crude oil is swapped for a special slate of products that the producing country


wants to import. A processing deal usually involves the refining of a given amount ofcrude oil at someone else�s plant in return for an agreed-upon product yield, with someof the products taken back and the rest sold to the refiner or on the spot market.

Some producing countries also utilize marketing agents to sell crude oil on

their behalf, usually into the spot market on a cargo-by-cargo basis or to a spe-

cific set of buyers or a specific region. These sales usually involve some kind of feeor other profit opportunity for the intermediary, and they are a useful way for a producerto move a fixed volume of oil. Indonesian state Pertamina, for example, has joint-ven-ture marketing firms with Japanese and South Korean companies that sell its crude oil tothese countries. One problem with this approach is that aggressive sales by the agentscan undermine other term-sales contracts from the same exporting country as Iran�sNIOC found in the early 1990s.

Triggers, Futures, Strips, And Swaps

Beyond the marketing methods of the producer countries themselves, there

are also a number of derivatives market tools that are increasingly being used by

crude oil buyers and sellers worldwide to provide the equivalent kinds of pro-

tection from market risks as available from term contracts. These techniques are

especially popular in the North Sea and US markets, arenas that are heavily ori-

ented toward spot deals. In addition to direct hedging through futures contracts

for WTI and Brent, which is quite significant (see pB13), other common forms of

such sales deals are trigger pricing and strips. Oil-price swaps and options can

also provide similar benefits to buyers or sellers. In a trigger deal, the seller or mar-ket intermediary � generally a Wall Street firm, trader, or major oil company with expe-rience in the futures and derivatives markets � usually agrees to sell a certain amountof oil at a price that is linked by a formula to a specific marker. The buyer then has theoption to trigger the price at any point of its choosing during a set period before deliv-ery. Sometimes the buyer is allowed to break up the pricing of the cargo in order to trig-ger the price of different parcels at different times. The seller covers the risk associatedwith this in the futures market or elsewhere, essentially allowing the buyer to pick themoment for the purchase when it feels that market conditions are most advantageous.

A key advantage for the seller is that involvement in a number of trigger deals pro-vides broader insight into market trends and a position to both hedge and trade against.In theory, the intermediary roles of setting up the trigger can be played by the buyer orseller, but in practice it is usually the seller that provides the trigger to the buyer.

Strips are most common in the US domestic crude oil market. The seller

agrees to provide a certain volume of oil to the buyer over a period of months

with the price for each month tied to the New York Mercantile Exchange futures

price. This allows both buyer and seller to manage their different price-risk

exposures for the entire period as they see fit, while also providing the predictabil-ity of term supplies at a price that tracks market levels. Strips can extend from a periodof a few months to over a year, but they are less popular for crude oils that do not trackWTI with a fairly clear and predictable differential.

On a broader scale, oil-price swaps and options provide many of the benefits

of an old-fashioned fixed-price term contract, but since they don�t involve phys-

ical deliveries of oil, they are simply a financial proxy. Unlike futures, they do

allow the hedging vehicle to be tailored to the exact needs of the individual buyer


or seller. The essence of an oil price swap is the parceling and transfer of risk

from an oil buyer or seller to a financial intermediary. Although no physical oilchanges hands, the user is assured a fixed price for a predetermined volume of oil bymeans of a set of purely �paper� transactions. In return for being assured of a fixed price,the buyer or seller agrees to give the swaps provider all or part of any further potentialgain from a swing in the oil market in their favor during the period of the swap.

Swaps are used in short-term applications such as contracts for differences or

CFDs in the Brent and Dubai markets, as well as to lock in the value of a partic-

ular volume of crude oil for just about any period, ranging from a single loading

to multiple years. An example of a typical swap for an oil buyer would work like this.An oil buyer seeking a fixed price of say, $18, would agree to pay the swaps providerthe difference between that fixed price and any lower market price that may occur dur-ing the period of the swap in return for payments from the swaps provider of the dif-ference between the fixed price and any higher market price. This effectively locks inthe $18 price for the buyer, transferring all the risk of higher prices to the swaps provider.The oil buyer would buy physical supplies in the usual way, but if market prices exceed-ed the fixed price it would receive an offsetting payment from the swaps provider. Inreturn, if physical prices were lower, the oil buyer would pay the swaps provider the dif-ference between the market price and the fixed price.

The Hierarchy Of Term Sellers

One of the main reasons for the wide variety of alternative marketing meth-

ods described above is the constant competition among sellers to lock in sales

volumes. Due to the past performance and perceived competitiveness and relia-

bility of various producers, there is a hierarchy of sorts among them, with some

being preferred over others as baseload suppliers in different regions. While

preferences vary among regions and with the purchasing needs of companies,

Saudi Arabia stands out as a core supplier to the widest group of refiners around

the world. One clear indication of this is in the much larger average size of most Saudisales contracts. While somewhat smaller than in the early 1990s, they still averaged over110,000 b/d in 1995 and were more than twice the size of those of most other produc-ers (see Chapter G: Trade). The extremely large contracts of the international majors withRiyadh are a further indication of its baseload supply role as well as an operational con-venience for Saudi Aramco. Saudi Arabia�s attractiveness as a baseload supplier extendsbeyond the majors to most European and Japanese companies that rely on Mideast crudeoils. The large volumes and range of grades, the past record of competitive and uniformpricing in each region, the flexibility of delivered sales in the US and Europe, and thewillingness to allow over-lifting of contract volumes all combine to make Saudi Arabia apreferred supplier and a source of stable, predictable baseload feedstock supplies formore companies than any other producer.

On almost the same level as Saudi Arabia as priority sources of baseload sup-

ply are Mexico, Venezuela, and Abu Dhabi. Their geographic focus, however, is

not as broad. Mexico and Venezuela are viewed by most of their US customers as

core suppliers, while Abu Dhabi has the same status among Japanese customers.

But this status does not extend much further than those regions. As with theSaudis, the customer base for these countries in their core markets is extremely loyal,and neither of them needs to rely on traders or alternative marketing mechanisms in


order to move crude oil regularly and reliably. For Japanese companies, several othercountries, such as Indonesia, China, and Qatar, also play core supply roles, but this part-ly reflects a preference for predictable supplies and a diversity of sources.

For some customers, Nigeria and Libya are clearly core suppliers, but this usu-

ally reflects some special circumstance relating to crude oil quality or financial

interrelationships. As a result, they are regarded as baseload suppliers by a small-

er group of companies. Libya is in a core supply position with its downstream affili-ates in Europe and with key equity producers, such as Italian Agip and Austrian OMV.Nigeria can be viewed as a baseload supplier to a few sweet-crude-oriented refiners inthe US, such as Sun, BP, and Hess, but the large number of traders among its term cus-tomers belies its status as a secondary supplier in most cases.

Although Iran is the largest term-contract supplier after Saudi Arabia, it is gen-

erally not viewed as a baseload supplier by the vast majority of crude oil buyers.

Even Japanese companies, which are well-represented on Iran�s customer list,

regard these supplies as among the most expendable. This status seems to reflect

both Iran�s past record of aggressive marketing as well as the political uncer-

tainties that surround its oil exports, as was illustrated by the broadening of the

US boycott on all purchases of Iranian crude oil in 1995. Although they limited thescope of Iran�s sales outlets, these political measures did not inhibit its oil exports or sig-nificantly undermine the prices it receives for its crude oils on the international market.Tehran�s secondary status is also partly the result of its own marketing methods, whichincluded a heavy reliance on spot sales and other alternative methods in the early 1990s.But since 1994, Iran has not been under pressure to boost sales volumes, and its term-contract-sales policies have become steadier and more stable, which has helped it bothto survive intense market competition in Southern Europe from Russian exports as wellas to cope with the loss of its US customers in 1995 due to sanctions.

Among other major exporters, Norway has started to emerge as a baseload sup-

plier in the US and Europe through Statoil. Although large volumes of Norwegiancrude oils are handled by equity producers, as in the UK, Statoil has by far the largest sharebecause it markets crude oil on behalf of the government. To cope with these large vol-umes from the world�s second-largest oil exporter, it has established a growing number ofterm deals. It is regarded as such a reliable supplier that refiners such as Ultramar havegone so far as to modify their refineries to handle new supplies of Statoil�s Heidrun grade.

Most other term-contract suppliers are viewed as second-tier, or non-base-

load, sources of supply. This is reflected in the diversity and variability of their cus-tomer lists and the relatively small average contract volumes that they market. Countriesfalling into this category include Syria, Egypt, Angola, Ecuador, and Oman. However,producers serving the Asia-Pacific region such as Malaysia, Indonesia, Yemen, and Qatarhave generally benefited from the preference of Japanese crude oil buyers for stableterm-contract relationships. In these second-tier countries, equity producers also play acore role in absorbing their own output and also other production from the government.

The Varying Strategies Of Buyers

While the concept of baseload supply is central to the purchasing patterns of

most oil companies and is at the heart of successful term-supply relationships,

few firms other than some high-risk traders are willing to put all of their eggs in

one basket. Even the overseas downstream affiliates of Saudi Aramco,


Venezuela�s PDV, and Kuwait Petroleum Corp. seek out other term crude oil sup-

plies, if only for quality and operational reasons. In this sense, a company�sapproach to term crude oil purchasing can be viewed as a portfolio, with different con-tracts having a mix of different attributes. The grouping of crude oils varies dependingon the position, needs, and objectives of the company. Some firms have access to moreequity supply or have locational or quality preferences that outweigh other concerns.Term-contract supply strategies can range from heavy reliance on a small number of sup-pliers to several smaller contracts with a range of suppliers.

Politics and particularly the use of embargoes and economic sanctions by the

US government have become some of the more important considerations for

crude oil buyers. With the US imposing unilateral restrictions on crude oil pur-

chases from both Libya and Iran in addition to the UN restrictions on Iraq, a large

range of commercial relationships has been affected and these kinds of measures

may be expanded. US companies in particular must consider the risks of term-

contract supply arrangements with countries that may later be singled out for

sanctions. While lost investments represent a much more serious problem, the shiftingin supply deals for large US buyers of Iranian crude oil, such as Exxon in 1995, was noteasy and made them vulnerable to demands for stiff terms from other suppliers. In thecase of Exxon, significant increases in Saudi supplies and forays into the Russian Uralsspot market helped ease the strain.

The supply strategies of major oil companies, such as Exxon and Royal

Dutch/Shell typify the approaches of large international oil companies, albeit

with some variation. While both depend on Saudi Arabia for more than half of theirterm-contract crude oil needs, Exxon turns to a smaller range of producers for its othersupplies, while Shell seems to put more emphasis on diversity (see Chapter G: Trade).

European majors such as Elf, Agip, and Total don�t seem to lean as heavily on

Saudi Arabia and often prefer to turn for term crude oil supplies to countries

where they already have strong equity crude oil supply relationships. Libya,Nigeria, and Iran tend to loom larger in their supply arrangements than they do for theinternational majors.

Japanese and South Korean firms have a unique pattern of term crude oil

purchasing that reflects their highly risk-averse approach. Due to relatively low

volumes of equity crude oil production and an abiding concern for supply secu-

rity, they don�t rely on any one source too heavily, but they also seem to view a

wider group of producers as baseload suppliers. Each company has many sourcesof supply, but contracts of more than 25,000 b/d are unusual and those over 50,000 b/dare extremely rare, except for the biggest buyers. Saudi supply contracts are usuallyabout the same size as those with other producers, such as Abu Dhabi, Qatar, Kuwait,or Iran. Japanese buyers also buy jointly from Indonesia, China, and Mexico, reducingthe volumes and risks for individual refiners. Other large Asian crude oil buyers suchas Indian Oil Corp. or Pakistan tend to have more dominant relationships with a small-er group of suppliers.

As one might expect, the crude oil-supply patterns of oil traders show the

least concern for reliable baseload volumes and are mostly oriented toward riski-

er non-core suppliers. They also lean heavily on just a few sources. Traders withrefineries, such as Phibro, and some refiners, such as Coastal and Petrofina, also followthe same pattern. Iran, Nigeria, and Ecuador stand out as primary suppliers to these trad-


ing firms. Some highly spot-oriented sellers, such as the Russians, are also an importantsource of supplies to trading companies. A greater willingness to switch between supplysources also characterizes the approach of traders and other similar firms.

Who�s Who Of Term Contracts

A greater level of detail on the crude oil marketing techniques of some 35 key

exporters can be found in the reference section of this report (see Chapter F:

Country Profiles). It expands on many of the points made in this chapter on term

contracts and in the preceding one on spot crude oil markets.

The tables on crude oil sales volumes in the reference section of this book (see

Chapter G: Trade) present a wide range of useful but hard-to-find data on term

contracts. The first set covers PIW�s annual surveys of term crude oil contracts

for 1995, 1993, 1992, and 1989, broken down by both country and company.

Next is a profile of US crude oil imports by company for the last five years. ThePIW surveys give the best available overview of the structure of term crude oil suppliesand their evolution from both the perspective of supply sources and company purchas-es. The US imports data display comprehensive details for individual countries and com-panies, but they lack a complete breakdown between spot sales, term contracts, andequity supplies or other arrangements.

The next chapter takes a closer look at the particular difficulties of of trans-

porting and storing crude oil, which have a critical impact on oil markets. Notonly are transportation and storage costs an important variable in the total cost of crudeoil, the smooth operation of transport systems and pipelines is critical to the effectivefunctioning of oil markets.

CRUDE OIL HANDBOOK PIW © D1

LLOOGGIISSTTIICCSS ��

TTaannkkeerrss,, PPiippeelliinneess,, AAnndd SSttoocckkss

The physical process that ties markets, refiners, traders, and producers together

is the sometimes-complex and difficult business of transporting and storing

crude oil. While it�s easy to view these operational activities as secondary and take

them for granted during periods of smooth market operations, logistics have a

tremendous impact, and they are of critical importance in periods of crisis or dis-

location. These basic transport and storage functions also have their own inter-

nal economics and dynamics that can impinge on oil markets in major ways. Oilhas been described by some economists as a �flow� commodity, in contrast to metals oragricultural commodities, which traditionally involve much higher inventories. Most ofthe world�s oil inventories are used for operating the huge global supply system and canbe thought of as an enormous pipeline stretching from the wellhead to the retail pump.Only the equivalent of a small 10-15 days of forward demand cover is discretionary, orfreely usable by oil companies. And the trend of the mid-1990s has been toward tightermanagement of these operational stocks, bringing them down to minimum operating lev-els at times. Thus, the smoothness of transport and storage systems is increasingly criti-cal to ensure that supplies are adequate. This chapter outlines the basic elements oftanker and pipeline transportation of crude oil and the global inventory system.

The Tanker Dilemma

World oil markets are enjoying a surplus of tankers that has lasted for over 20

years and has kept the cost of moving crude oil relatively low, especially on the

largest crude oil carriers, which are the backbone of global oil trade. The basic

dilemma that has been confronting

the tanker industry for years is the

need to replace an aging fleet, cou-

pled with the inability to achieve

high enough returns to justify the big

capital investments that would be

required to do so. Another obstacle

has been added by growing public

concern over and legal liabilities for

oil spills. These difficulties have createda harsh business environment for tankerowners, and they have also promptedmajor international oil companies toreduce their own fleets over the years.Some oil-producing countries, such asSaudi Arabia and Iran, have increasedtheir fleets with the growth of deliveredcrude oil sales and formula pricing. Saudi Aramco�s Vela oil tanker unit now has 23 verylarge crude carrier (VLCC) sized ships, and is scheduled to receive five new 300,000

CCrruuddee OOiill TTaannkkeerr FFlleeeettCrude oil alone makes up about one-third oftotal worldwide seaborne trade. There was afleet of some 3,100 tankers above 1,000 dead-weight tons, with combined capacity of 275-million deadweight tons at the end of 1995. Ofthese, 220-million dwt were for crude oil.Deadweight tons are approximately equal tocarrying capacity. Standard size classificationsof crude carriers follow:

FleetClass Size (dwt) (million dwt)Aframax 60,000-100,000 48.8Suezmax 100,000-200,000 46.8VLCC* 200,000 and over 124.5Total 220.1

*Very and ultra large crude carriers.

D2 PIW © CRUDE OIL HANDBOOK

deadweight ton ships in 1996-97. Iran is also taking delivery of five big ships in 1996,and Kuwait is expected to place new orders. Nevertheless, independent owners stillaccount for about 60% of the total tanker fleet, with the rest owned by international oilcompanies and producing countries.

The average age of the biggest ships � the very large crude carriers (VLCCs)

and ultra large crude carriers (ULCCs), with capacities of over 200,000 dead-

weight tons � is about 15 years, but many of them were built before 1978 and

are due to soon reach the end of their assumed operating lives of 20 to 25 years.

The VLCCs and ULCCs make up about 45% of total tanker tonnage. They trans-

port 90% of Mideast Gulf crude oil exports and sail to all of the main world mar-

kets, making them critical to global crude oil commerce. Oslo-based Intertanko, theinternational association of independent tanker owners, estimated that in 1995 therewere 33 surplus VLCCs, or about 7% of the fleet of 449 vessels. The origins of this long-running surplus lie in the period of extremely high freight rates and rapidly rising oildemand in the late 1960s and early 1970s, which triggered massive overbuilding of thefirst generation of VLCC- and ULCC-sized vessels. The total tonnage of ships over 200,000tons has declined from more than 140-million tons in the early 1980s to about 125-mil-lion in the mid-1990s. And with rising international oil trade, the surplus has diminishedfrom as much as 20% of the fleet in the early 1990s. The movement toward a more evenbalance has resulted in a slight firming in freight rates in 1995 and early 1996, but ratesare still not high enough to justify construction of new tankers, especially the higher-costdouble-hull vessels that are expected to become the norm.

In anticipation of the retiring of old surplus tankers, and in response to the

higher freight rates that prevailed during the Gulf war period, many new ships

of over 200,000 tons were ordered in the early 1990s. But the flurry of new orders

was a bit premature, and these new ships are now extremely unprofitable, pro-

viding little incentive for further new orders except from the bravest of owners.

According to Intertanko, average spot freight rates in 1995 covered only about one-halfof the $40,000 per day operating and capital costs of a new tanker. Meanwhile, older,pre-1975, second-hand VLCCs almost broke even. Given increasing concerns about thesafety of tankers and requirements by both the US and international organizations fordouble-hull tankers, a two-tiered market has begun to develop, with better ships gettinghigher rates. This premium, which is taken into account by Intertanko, is not yet largeenough to make the new ships remotely profitable. Only during the Gulf war period,when the world VLCC fleet was almost fully utilized with large Saudi and Iranian float-ing stocks, did freight rates reach the kind of returns that could encourage significantbuilding of new vessels.

Double-hull tankers currently account for about 14% of the entire fleet, and

only about 7% of VLCC and larger tankers, while over 22% of the smaller

Aframax class are double-hulled. This larger share reflects the more recent tim-

ing of new orders in response to new regulations such as the US Oil Pollution Act of1990 (OPA �90). The relatively low percentage of double-hull tankers in the VLCC fleetmeans that a significant tightening of that market would likely to lead to a much morepronounced two-tier market. However, as of now there are plenty of single-hull VLCCsthat still qualify to call at US ports under OPA �90. Reliance on more modern ships couldget a significant push in the future from stricter regulations on the part of both importersand oil producing countries.


No obvious solution exists yet to the dilemma facing the tanker industry:

namely, the need to rebuild, but the weak incentives to do so. The risk of a seri-

ous crunch that would drive freight rates up sharply is genuine and could be con-

fronted by world oil markets as soon as the late 1990s. As in other areas of the

oil industry, the long lead times needed for building new capacity tend to encour-

age boom-and-bust cycles, which are likely to be exacerbated in the case of VLCCs

by the age of the fleet and the heavy reliance on spot chartering. The exact cir-cumstances of such a squeeze on shipping capacity are hard to predict, but the financialrewards are not yet in place for the smooth replacement of the large number of oldtankers in the fleet. While the Suez Canal and expanded pipelines across Egypt and Israelfrom the Red Sea to the Mediterranean could help to ease some of the potential pres-sures, the risk is that there could be a period of months or years of extremely high freightrates that would add significantly to the delivered cost of crude oil. Such high returnswould encourage aggressive shipbuilding that would eventually bring on another bust,but not until after the freight component of delivered crude oil costs had been driven toan extremely high level � perhaps two or three times current levels. Adding to uncer-tainty about when a squeeze might occur is the capability of older VLCCs to extend theiroperational lives to up to 30 years by installing segregated balast tanks.

The Tanker Market

Like the crude oil market itself, the tanker market operates on both a spot and

a term basis, with the latter referred to as the time-charter or period market. Spot

charters account for a great deal of tanker usage � as much as 50% � especial-

ly for the long-haul VLCC trade. But dependence on spot chartering has declined

somewhat from peak levels of over 80%. The drop in spot movements reflects

the growth of producer country fleets as well as the preference of Japanese and

other buyers for period chartering of safe, modern vessels. The still heavy spot

chartering reflects the continuing surplus in the market and also increases its

vulnerability to squeezes in the future. Many oil companies also have their ownships, but unless the company has dedicated them to serving a particular route for oper-ational reasons, these vessels are usually released into the spot market. Because it is hardto make sure that an individual ship is in the right place at the right time to load a cargo,oil companies tend to opt for the flexibility of the spot market, which, aside from lowcost, is its main attraction. Time chartering may continue to increase as buyers becomemore selective about the safety of their ships, but this is still likely to leave the spot mar-ket dominated by older, lower-cost single-hulled ships, which will act as a depressant onoverall freight rates.

In a typical spot charter, the cost is determined by a number of variables,

including the particular voyage, the availability of appropriate ships in relation

to demand, the condition of the vessel being chartered, and other factors. The

cost is usually assessed as a percentage of the Worldscale system of base or flat

rates, which are updated annually by an international panel. A lump sum is some-times charged, but this is more typical of short voyages or the shipping of refined prod-ucts. Illustrating a standard spot charter, an oil company wanting to load a cargo of crudeoil from a particular port on a particular day in the near future contacts a tanker brokerto line up a vessel. The broker negotiates rates with the owners of the available vessels.These are calculated as a percentage of the Worldscale flat rate, which is based on a stan-


dardized assessment of the costs of sailing a certain type of ship on that particular voy-age. A rate of Worldscale 40 simply means 40% of the established flat rate for the spe-cific voyage in question. A host of operational considerations in addition to the price playa part in a company�s final decision on which ship to charter.

Other factors that loom large in determining freight costs are insurance,

demurrage, and environmental issues. With greater public concern about oil

spills and stiffer legal liabilities, the costs of operating tankers are rising. Oil

companies in particular face difficult choices because of the potential public rela-

tions damage from a spill, even if they own only the cargo, not the vessel, and

therefore are not directly responsible. Under the US Oil Pollution Act of 1990, boththe vessel and cargo owner are potentially exposed to unlimited liabilities for a spill,depending on the requirements of state law. As a result of these kinds of laws and newinternational rules that stipulate the construction of double-hulled or equivalent vesselsfrom 1996 onward, costlier double-hulled ships are the norm for new construction. Theadded environmental burdens for tanker owners and their clients have mainly appearedso far in insurance costs, but as charterers become more selective, freight rates for dou-ble-hulled ships are also starting to feel added pressure too.

Insurance rates can soar due to war risks, as they did during the attacks on ship-ping during the Iraq-Iran war. There are two basic types of tanker insurance: cargo insur-ance, which covers the value of the oil being transported and is usually the responsibili-ty of the owner of the oil; and hull insurance, which covers the ship and is usually paidfor by the shipowner or time-charterer.

Demurrage is unpredictable and potentially costly. It refers to the extra costs

of keeping a tanker waiting in port, which can be quite significant if the ship

faces unexpected delays that last for a period of several days. This might occur if anexporter is unable to follow the planned loading schedule or if a cargo is unable to beunloaded promptly due to a storm or other disruption. Usually, the party deemedresponsible for the delay must pay the shipowner or time-charterer for the demurrage ata set rate, depending on the size of the vessel.

Choosing A Ship

The crude oil tanker-chartering business is divided into three broad markets,

depending on ship size. The reason for this is that efficiencies of scale, logistical

constraints on vessel size, and customer needs usually mean that tankers of a cer-

tain type are best suited to and tend to dominate specific trade routes. Crude oil

buyers generally cannot easily substitute one class of ship for another. Whileeconomies of scale usually make larger tankers more cost-effective, there are any num-ber of reasons that VLCC-class vessels cannot be used for all voyages. A crude oil buyer�sterm contract is likely to be based on a certain volume that can be best handled by amonthly or quarterly loading of a single cargo of a certain size. Some discharge ports �for example, all of those in the US except the deep-water Louisiana Offshore Oil Port,or Loop � require the use of smaller, shallower draft ships. Similarly, the limitations ofloading ports can also constrain the type of vessel that is used. Specific size restrictionsfor individual loading ports are provided for all of the crude oils that are covered in thesecond section of this handbook.

The largest market in terms of tonnage, distances, and ships is the VLCC trade,

which has been covered in part above and which dominates shipments both east


and west from the Mideast. The economies of scale in using these big vessels of 200,000dwt or more for the large volumes produced from the Mideast and the longer distancesthat the crude oil must travel are obvious. The difficulties for both buyer and seller comemainly in the oil-market risks during the long time period of the voyages, but these riskshave been largely overcome through geographically specific formula pricing. For US cus-tomers, the extra cost of lightering these vessels, or transshipping the crude oil to get theoil into shallow-draft US ports, must also be taken into account as part of the total ship-ping cost, but even so, it is still cheaper to ship crude oil from the Mideast to the US inVLCCs. A separate complication for oil shipments on sized tankers between US ports arespecial cabotage restrictions that require the use of US flagged ships, which are signifi-cantly more expensive to operate than those on the international market.

There are also some other secondary uses for VLCCs outside of the Mideast

trade. They are sometimes utilized for voyages from West Africa to Europe and the USor trips from Europe to the US. VLCCs in westbound trade from the Mideast can at timesbenefit from a partial backhaul when they take crude oil from West Africa to East Asia� covering part of the voyage that they would normally have to make anyway � in bal-last on their return from the US or Europe to the Mideast. In addition, VLCC-class tankersare preferred for usage in floating storage. This involves both temporary storage and ded-icated vessels that are in permanent use at loading terminals, particularly those for off-shore production.

The Aframax class of tankers � those from 60,000-100,000 dwt � represents

the smallest of the regular oceangoing crude oil carriers. They are used primari-

ly for short-haul trades in the Caribbean, Mediterranean, North Sea, and Far East.

Some work the shorter voyages from the Mideast as well. These ships are also the classused in most spot crude oil market transactions. The smaller size of the cargo, 450,000-750,000 barrels, provides flexibility and allows the ships to easily load and unload atalmost any terminal. Many ships in this class also meet the Panamax size restriction of106 feet beam, which in practice means an upper limit of 60,000-70,000 dwt and is themaximum size that can pass through the Panama Canal. Some vessels of this size havebeen specially configured to serve offshore loading platforms in the North Sea or else-where, while others have been fitted for the lightering of larger vessels. Tankers of thissize are also regularly used for carrying dirty refined products such as residual fuel oil.Unlike the larger tankers, the Aframax fleet is not heavily dominated by older ships, andthus it is less vulnerable to the kind of squeeze that could occur if an adequate incen-tive to replace those aging fleets does not emerge.

Suezmax vessels of 100,000-200,000 dwt are the intermediate class of crude oil

tankers. They also dominate particular trade routes, but they generally have

more overlap with the other two categories, and they sometimes trade along

their main routes. Suezmax tankers trade primarily from the Eastern

Mediterranean, Red Sea, and West Africa to the US and Europe. They are also usedfor some longer shipments in Asian markets, and they sometimes take crude oil from theNorth Sea to the US or the Mediterranean. The embargo on Iraqi exports and the earli-er restrictions on Libyan crude oil sales to the US have been especially hard blows forSuezmax ships, which played an important role in those trades. While all of these ves-sels can use the Suez Canal, only those that are 180,000 dwt or less can pass throughfully laden. This restriction is due to rise to 200,000 dwt by the late 1990s. Suezmax shipsmust often be lightered in order to use shallow draft ports such as those in the US. The


age profile of the Suezmax fleet is similar to that of VLCCs, with most of the ships grow-ing old and in need of replacement by the end of the 1990s.

A Profile Of Key Shipping Routes

To provide a comparative picture of the most common voyages in the inter-

national crude oil trade, the table on page D7 gives basic data on distances and

average voyage time. Use of the Suez Canal is a key consideration in voyages from

the Mideast to the Atlantic Basin. Fully laden VLCCs are too big for the canal and

often take the longer route around the Cape of Good Hope. The distances shownin the table are nautical miles, and the times are based on an average speed of 12.5knots, typical of the slow speed often used to conserve fuel on older, less fuel-efficienttankers. VLCCs are capable of speeds in excess of 16 knots, and newer vessels usuallyoperate at this speed. In addition to the travel times, it takes at least one to two days ateach end to load and discharge the vessel.

Pipelines: Long Hauls And Shortcuts

Pipelines are secondary to tankers in terms of the volume of crude oil that

they transport for international trade, but they are no less crucial. They provide

vital outlets for many landlocked crude oils and critical links within large conti-

nental markets. They also complement tanker transport at key geographical

points, such as Suez and Panama. The main economic justification for pipelines istheir sheer efficiency. In addition to extremely low-cost, efficient transportation, they pro-vide shortcuts at key points on the earth and provide vital links to key inland markets.Alternatives to pipelines for overland transport, such as railroads and tank trucks, lackthe scale to meet the needs of large refining centers or oil-producing regions, and, in anycase, would normally be far more expensive. The big drawback to pipelines is their lackof flexibility. They can only move oil along their designated route and major new con-struction is required if markets shift or trade dries up.

The clear efficiencies of pipelines stand in sharp contrast to their vulnerabil-

ities, particularly in international trade when they must cross borders. In addi-

tion, basic operational difficulties can also cause huge problems, with a stoppage

at one point holding back large supplies from further up the line. One importantexample of this was the problems with the UK Brent system in 1989-90, when the shut-down of some main platforms choked off supplies from satellite fields. Examples of thepolitical vulnerabilities range from the persistent guerrilla attacks on Colombia�s CanoLimon line to the many idle pipes that stretch across the Mideast.

For oil-producing countries with limited or no access to the sea � such as

Iraq, Azerbaijan, and Kazakstan � pipelines are always a key strategic asset. Overthe years, Iraq has built four different pipeline export routes, of which only one, theTurkish line, seems to have much chance of being used when the United Nations embar-go against Iraqi exports is lifted. Even producers with adequate ports have built majorpipelines in order to provide alternative outlets. An obvious example of this is SaudiArabia�s Petroline outlet at the Red Sea port of Yanbu, which provides an alternative tothe politically troubled Mideast Gulf and Strait of Hormuz.

The construction of export pipelines from Central Asia has become a key bottle-

neck in the development of the Kazak and Azeri oil industries that finally started to

(Please turn to pD8)

CR

UD

E O

IL HA

ND

BO

OK

PIW

©D

7

SHIPPING DISTANCES AND TIMES FOR KEY TANKER ROUTES (Nautical Miles / Days)

From:To: Ras Tanura, Bonny, Ardjuna, Sullom Voe, Sidi Kerir, Amuay Bay,

Americas � Route Saudi Arabia Nigeria Indonesia UK Egypt VenezuelaCuracao, Netherlands Antilles via Cape 10,729 / 35.8 4,560 / 15.2 ... ... 5,502 / 18.3 ...Curacao, Netherlands Antilles via Suez 8,700 / 30 ... ... ... ... ...Corpus Christi, Texas, USA via Cape 12,546 / 41.8 6,220 / 20.7 ... 4,875 / 16.2 6,618 / 22 1,802 / 6Corpus Christi, Texas, USA via Suez 9,816 / 33.7 ... ... ... ... ...Philadelphia, Pennsylvania, USA ... ... 5,182 / 17.3 ... ... ... ...Rio de Janeiro, Brazil ... ... 3,392 / 11.3 ... ... ... ...Los Angeles, California, USA ... ... ... 7,899 / 26.3 ... ... ...New York, New York, USA ... ... ... ... 3,174 / 10.6 ... 1,802 / 6St. Croix, Virgin Islands, USA ... ... ... ... 3,727 / 12.4 ... ...

Europe �Fos/Lavera, France via Cape 10,783 / 35.9 3,994 / 13.3 ... 2,649 / 8.8 1,400 / 4.7 ...Fos/Lavera, France via Suez 4,684 / 16.6 ... ... ... ... ...Rotterdam, Netherlands via Cape 11,169 / 37.2 4,386 / 14.6 8,525 / 29.4 600 / 2 3,152 / 10.5 4,318 / 14.4Rotterdam, Netherlands via Suez 6,350 / 22.2 ... 11,390 / 38 ... ... ...Le Havre, France ... ... 4,181 / 13.9 ... ... ... ...Trieste, Italy ... ... 4,957 / 16.5 ... ... ... ...

Africa �Durban, South Africa ... 4,280 / 14.3 ... ... ... ... ...

Asia/Pacific �Singapore ... 3,701 / 12.3 ... ... ... ... ...Yokohama, Japan via Malacca 6,593 / 22 ... 3,209 / 10.7 ... ... ...Yokohama, Japan via Sunda, Indonesia ... 10,740 / 35.8 ... ... ... ...Ulsan, South Korea ... 6,253 / 20.8 ... ... ... ... ...Singapore ... ... 8,000 / 26.6 513 / 1.7 ... ... 11,423 / 38


make some steps toward resolution in 1996. But the future of these lines remains in

doubt, illustrating the intense political struggles that pipelines can generate as well

as their vulnerability to such pressures. While it was clear from the start that the mostviable route in the short term for both Kazak and Azeri crude oil exports to the West wasthrough Russia, the powerful northern neighbor has been able to extract some benefits fromits favored position. Following much hard bargaining, partners in the $2-billion CaspianPipeline Consortium are Kazakstan, Russia, Oman, Chevron, Mobil, Agip, British Gas,Lukoil, Rosneft, and Kazak state Munaigas. This 1,500-kilometer line is to be built in twophases and will run from the Tengiz field in western Kazakstan to the Black Sea, with capac-ity rising from about 300,000 barrels a day to over 1-million b/d. The Azeri export line callsfor two routes to the Black Sea, one via Russia, which would tie into the CPC system, andone via Georgia, which is also likely to involve the Russians. A line through Turkey, or atleast to bypass the crowded Bosporous shipping lanes, is also a distinct possibility.

Continental Pipeline Systems

The world�s two major continental crude oil pipeline systems have been built

over the last century in North America and the former Soviet Union. Pipelines

provide the key, and sometimes the only export outlet for Russian and Canadian

crude oils. These pipeline export volumes of about 2.5-million b/d amounted to some10% of the international crude oil trade in 1995. Long periods of political stability, well-developed oil industries, and the benefits of huge integrated systems spanning long dis-tances all contributed to the growth of these networks.

Russia�s primary export network � the Druzhba, or Friendship, line � is an

artifact of the old Soviet Empire that serves almost all of Eastern Europe. Itextends from the main refining center of Kuybyshev in the Volga-Urals region into west-ern Russia and Belarus, where it splits into three branches: one taking crude oil north tothe Baltic export outlet of Ventspils, one to Poland and Germany, and one further southto Hungary, Slovakia, and the Czech Republic. Another long-haul pipeline system trans-ports export crude oil from Kuybyshev to the Black Sea for loading mainly at the Russianport of Novorossiysk. This system also serves the Ukrainian port of Odessa. Russia�s abil-ity to export crude oil is sometimes constrained by the size of its pipelines and termi-nals, which leads to competition for pipeline space in monthly awards of capacity to pro-ducers. As part of the new CPC line from Kazakstan, the pipeline capacity servingNovorossiysk is to be expanded significantly by 1998.

Western Europe�s crude oil pipelines are modest compared to the size of its oil

industry. But with the end of the Cold War, the first link from west to east has now

been forged, and others may follow. The 340-km Mero pipeline from Ingolstadt inGermany to the refineries of Kralupy and Litvinov in the Czech Republic opened in 1996,giving these refineries an alternative to Russian crude oil. Like the Adria pipeline furthersouth, the 200,000 b/d line brings Mediterranean crude oil into Eastern Europe. In addi-tion to the subsea lines serving North Sea production areas, Europe�s largest crude oilpipelines were built mainly to link refiners in southern Germany, Austria, Switzerland, andcentral France to Mediterranean ports (see map on the opposite page). However, not allof this capacity is needed due to reductions in refining capacity in Germany, and thenorthern section of the CEL line, which runs across Switzerland and into Germany, wasclosed in 1995. Western Europe�s extensive barge network and reliance on coastal refiner-ies has tended to reduce its need for long-haul pipelines.

CR

UD

E O

IL HA

ND

BO

OK

PIW

©D

9

LEGEND: NORTH SEA LINESTERMINAL/LANDING POINT CRUDESullom Voe, UK BrentFlotta, UK FlottaCruden Bay, UK FortiesTeeside, UK EkosfiskStrue, Norway Oseberg

LEGEND: CONTINENTAL LINESAdriaCEL � Central European LineDruzhbaSPSE � Southern European LineTAL � Trans Alpine LineMeroBlack Sea Line

Key European Crude Oil Pipelines


North AmericanCrude Oil Pipelines

TransMountain

Edmonton

The huge North American pipeline grid serves two basic purposes. It brings

landlocked crude oils in Alberta, Alaska, West Texas, and elsewhere to the main

refining centers through such pipelines as the Trans-Alaska Pipeline System and

the Interprovincial-Lakehead system. It also pulls in imported crude oils to

inland US refineries through systems such as Capline. With the exception of theTrans-Alaska Pipeline System, which is just one link in the long supply chain from theNorth Slope to refiners, the North American crude oil pipeline network feeds bothdomestic and international oils directly to refiners. The operation of all of the major long-distance pipelines is fairly similar, with well-established government regulations in boththe US and Canada. While access is open to all, pro-rationing of capacity occurs amongusers if there is not enough space in a line to handle all of the volume that needs to beshipped. Flexibility is provided by storage at terminals, pipeline hubs, and refineries.Capacity is usually allocated on a monthly basis, and pipeline users typically face a dead-line for nominating their volumes of about five working days before the end of themonth to ensure smooth scheduling.

A key bottleneck in the US pipeline system in the early 1990s has been the

route from the Gulf Coast to the key Midcontinent hub of Cushing, Oklahoma, the

US crude oil futures market delivery point. As domestic production has declined,

dependence on international crude oils has increased, requiring additional capac-

ity in periods of market tightness. A major addition in 1996 more than doubled

capacity to some 500,000 barrels a day through three different pipes: the 70,000 b/dTexaco line that runs from Houston via Wichita Falls; the 160,000 b/d Arco Seaway linefrom Texas City; and the latest addition, the 270,000 b/d Arco Seaway line from Freeport,Texas. (See discussion of the West Texas Intermediate market, pB15.) While this eases thepressure on Cushing, the need for expanded lines into the Midwest is likely to grow asdomestic output falls and US demand rises in the years ahead.

The pipelines shown in the map above are just the primary links in the system,

reflecting the largest-volume shipments. These are mainly targeted at the Midwest,


converging on the Chicago area. They bring in Canadian crude oil from Alberta, domes-tically produced crude oil from the Southwest, and international supplies from the GulfCoast. The Four Corners Pipe Line and All-American line provide an outlet for extra crudeoil on the West Coast, but they are relatively small in volume. The Trans Mountain PipeLine in Canada provides a similar West Coast outlet for Alberta production.

A pipeline across the Isthmus of Panama has provided a valuable shortcut

for shipments of Alaskan crude oil from the Pacific to the Caribbean, feeding

US refiners on the Gulf and East Coasts. But with the lifting of the US ban on

exports of Alaskan North Slope crude oil, its future came into doubt in 1996.

The advantage of the line is that it allows the crude oil to bypass the canal and movemore easily to market, but the need for such shipments had declined significantly evenbefore the US ban on ANS exports was lifted. The greatest potential for the line in thefuture may lie in reversing it to allow Venezuelan and Mexican crude oil to be export-ed west to Asia more easily.

The Key Suez Nexus

Suez has long been a critical nexus for the oil industry, linking the dominant

Mideast producing area with European markets. Two pipeline systems link the

Red Sea to the Mediterranean, supplementing the Suez Canal, which cannot han-

dle fully laden VLCC-sized tankers, and shortening the long voyage from the

Mideast to Europe and the Americas. These lines, which run through Egypt and

Israel, were both expanded in the early 1990s to a combined capacity of 3.6-mil-

lion b/d. The main Sumed line was used at or near capacity in 1992-93 due to attrac-tive tariffs and growing sales of Mideast crude oil into the Mediterranean. The long-underused Israeli Tipline has also been revived for international use with the improving

Major Mideast Crude Pipelines

Turkish Export Line


political situation in the region. Both lines can handle VLCC-sized cargoes easily, over-coming the draft restrictions of the Suez Canal, and large ships also have the flexibilityof discharging some of their cargo in one of the pipelines and then using the canal tocarry a partial load (see map,p11). With the growth of delivered crude oil sales by pro-ducers in the Mideast, the northern terminal of the Sumed line at Sidi Kerir has becomean important sales outlet for Saudi and Iranian grades.

Operational Peculiarities Of Pipelines

Pipelines, like tankers, have their own operational peculiarities. While they

can be tremendously efficient, pipeline use also results in some inevitable mixing

of crude oil grades. The barrels that a company puts into a line at one end are

often not the exact same ones that it gets out at the other end. The resulting changesin quality are of little consequence when a line is dedicated to one crude oil stream, suchas ANS or Arabian Light. But when a wide range of crude oils is used, the variation canbe significant. A system of quality adjustment is generally used to offset these variations,and adequate storage allows for varying streams to be more easily segregated. USpipelines have developed sophisticated quality-banking systems, which compensatepipeline users for changes in gravity and sulfur when its crude oil is moved through apipeline. Terms are specified, and the pipeline user knows before shipping exactly whatkind of value adjustment will be made for changes in quality. Russian pipelines are onlyjust beginning to develop the flexibility to deal with such variations in quality.

Advance scheduling and the trading of ratable volumes over a period of a

month or longer are also key examples of how pipeline crude oils contrast with

the international cargo trade. Trading commitments in pipelines are generally firmedup in advance, with little latitude after that for further trading. By contrast, crude oil car-goes can be traded even after they are on the water.

Major Pipeline Links

The table on page D13 profiles the major pipelines that are used in interna-

tional crude oil trade. There are also comprehensive gathering systems in all of themain producing regions, and much more extensive internal networks in North Americaand the former Soviet Union. Most of these domestically oriented lines have beenexcluded since they lack direct involvement in international trade. Distances are shownin both kilometers and miles, with capacity in 1,000 b/d.

Inventories: The Swing In The System

Global crude oil inventories are both an integral part of the supply system and

a key shock absorber to that system � able to offset both large and small supply

deficits. Crude oil inventories perform such mundane operational tasks as pro-

viding pipeline fill, tank bottoms, and oil in transit at sea, allowing smooth logis-

tical operations. Although these operational oil inventories are large, usually

accounting for over 80% of global oil stocks, they are far less important to the

immediate direction of oil prices than the much smaller volume of discretionary

stocks. Companies can use the latter at will, and this has a direct impact on mar-

kets and prices. Although oil stocks are notoriously difficult to measure, all market par-ticipants implicitly take a view on the level of discretionary oil-company stocks and theirlikely trend up or down when they make judgments about the future direction of oil

CR

UD

E O

IL HA

ND

BO

OK

PIW

©D

13

MAJOR PIPELINE LINKS IN WORLD CRUDE OIL TRADERegion/Pipeline Length CapacityMideast Country Operator/Owner From / To km (miles) 1,000 b/dPetroline Saudi Arabia Saudi Aramco Abqaiq / Yanbu (Red Sea) 1,270 (789) 4,800Turkish Export Line Iraq, Turkey INOC-Botas Kirkuk (Iraq) / Ceyhan (Turkey) 1,049 (652) 1,600Sumed Egypt Arab Petroleum Pipeline Co., Egypt Ain Sukhna (Red Sea) / Sidi Kerir (Med.) 320 (199) 2,400

(50%), Saudi, UAE, Kuwait, QatarTipline Israel EAPC Eilat (Red Sea) / Ashkelon (Med.) 241 (150) 1,200

Europe Country Operator/Owner From / To km (miles) 1,000 b/dDruzhba (Friendship) Russia, Belarus, Ukraine, Transneft and others Kuybyshev (Russia) / Mozyr (Belarus), then 1,380 (861) 1,400

Hungary, Slovakia, Czech north to Schwedt (Germany), south to 1,100 (683) 700Republic, Poland, Germany Litvinov (Czech Republic) 1,475 (916) 700

TAL Italy, Austria, Germany Trans-Alpine Line Trieste (Italy) / Ingolstadt (Germany) 450 (280) 720SPSE France, Germany Societe Du Pipeline Sud-Europeen Fos/Lavera (France) / Karlsruhe (Germany) 782 (486) 656CEL Italy, Switzerland, Germany Central European Line Genoa (Italy) / Ingolstaat (Germany) 753 (468) 180Adria Croatia, Hungary, Slovakia State-owned Omisalj (Croatia) / Bratislava (Slovakia) 663 (412) 200Mero Germany, Czech Republic Mero/Chemopetrol Ingolstadt (Germany) / Kralupy (Czech Republic) 340 (212) 200

Americas Country Operator/Owner From / To km (miles) 1,000 b/dTaps (Trans-Alaska) USA Alyeska (British Petroleum, Arco, Prudhoe Bay / Valdez 1,226 (762) 2,000

Exxon, Mobil, Phillips, Unocal, Hess)IPL-Lakehead Canada, USA Interprovincial Pipe Line Edmonton (Canada) / Duluth (USA), then 1,826 (1,135) 1,470

south via Chicago or 1,183 (735) 730north via Bay City, Michigan (USA) 909 (565) 470to Montreal (Canada) 1,006 (625) 550

Loop-Capline USA Louisiana Offshore Oil Port and Shell Loop, St. James / Patoka, Illinois 1,094 (680) 1,200Trans-Panama Panama Petroterminal De Panama Puerto Armuelles / Chiriqui Grande 130 (81) 860Cano Limon Colombia Occidental Cano Limon / Covenas 788 (490) 220


prices. The strategies that companies take as a group toward these discretionary stocksdetermine much of the incremental oil volume that reaches the market, and in turn dri-ves price levels.

A key development on the inventory front in the mid-1990s has been the

effort to operate on reduced inventories, which brought stocks in the US and

other key areas to record low levels in the spring and summer of 1996. This drive

toward lower inventories reflects both structural and temporary factors, and it

can be expected to add to the overall volatility of oil prices as the market is

forced to cope with the imbalances through changes in prices. Among the struc-tural reasons for the decline in stocks are cost reductions by oil companies, streamliningof operations, and rationalization of facilities � requiring less in operating stocks andperhaps greater reliance on futures markets and derivatives. Among the temporary fac-tors that contributed to the further decline in stocks in early 1996 were a cold winter,supply disruptions, and expectations that a return of Iraq to the market would add sig-nificantly to global supplies later in the year.

Worldwide crude oil stores can be divided up into a number of different cat-

egories that are almost all far easier to define than to measure accurately.

Because of crude oil�s use as a feedstock, virtually all crude oil stocks are part

of primary inventories, with secondary and tertiary stocks devoted to refined

product distribution and consumption. Of these primary crude oil stocks, there

are two basic groups: commercial, or industry stocks; and strategic, or govern-

ment-held stocks. The discretionary, or usable commercial stores that have such a bigmarket impact are generally in the hands of the oil companies. The stocks held in over-seas storage by producer governments such as Saudi Arabia, Iran, and Kuwait some-times blur the traditional distinctions between commercial and strategic stocks becausethey are used operationally for delivered crude oil sales, but they also have been builtup at times for strategic reasons.

At the end of 1995, total global oil inventories outside the former Soviet Union

and China amounted to some 5.785-billion barrels, or 87 days of forward demand

cover, according to PIW�s Oil Market Intelligence. That compares with over 90

days of forward demand cover a year earlier, indicating the trend toward hold-

ing lower inventories. Of the total, about 1-billion barrels were strategic stocks heldby consumer country governments, and around 4.73-billion barrels, or 71 days of for-ward demand cover, were commercial stocks held by companies. Of those commercialstocks, only about 730-million barrels, or 11 days of forward demand cover, were usablecommercial stocks, in the sense that companies could draw on them without disruptingtheir operations or cutting into the volumes that they are required to hold by some gov-ernments for security reasons.

Movements in discretionary inventory can influence the market as both a

source of extra supply and extra demand, with companies choosing either to

draw down or build up their stores, depending on market circumstances.

Forward prices themselves also send definite economic signals to companies

about building or drawing their stocks. This interaction between stocks and pricesreflects a perpetual balancing act that has become much more efficient in oil marketswith the development of forward and futures trading. When futures prices are higherthan prompt levels, markets are in contango, and if the gap between the two is wideenough to cover storage costs and interest, there is a strong incentive for companies to


build stocks. The reverse relationship, with high prompt prices, is a backwardation, andit creates an incentive to destock.

Commercial Inventories

The world�s commercial crude oil stocks are held mainly at production facili-

ties and in pipelines, on tankers at sea, and at refineries. These inventories are

somewhat seasonal, depending on refinery needs, but they vary less over the

year than they used to. Commercial crude oil stocks have usually fluctuated

much less than refined product inventories, which are more sensitive to final

demand. There are obviously minimum lev-els of stocks at all of these points in the sup-ply chain that are required to keep the sys-tem moving smoothly. That minimum levelwas fairly constant in the past, changing onlyslowly over time, but efforts to cut back onstocks may allow the system to operate effi-ciently at a significantly lower level of stocks.In addition, many countries in Europe andelsewhere do not hold segregated strategicstocks but require companies to hold a min-imum obligatory level of extra stocks. Therequirements are usually measured in termsof a firm�s sales volume, and are in effect partof the minimum base level. Discretionary orusable commercial stocks are any inventoriesabove these levels. In practice, despite thepolicy of oil companies in recent years to operate with the lowest possible level ofstocks, usable commercial stocks have rarely dropped below 10 days of forward demandcover, according to PIW�s Oil Market Intelligence.

Independent storage terminals provide tankage that is rented commercially to

third parties, and thus these volumes can be a key indicator of trends in discre-

tionary, or usable commercial stocks. While some of the oil held in independent

storage is for operational purposes, these facilities are designed to be used by

traders and others needing temporary storage beyond their usual operational

requirements. About 26-million barrels of crude oil storage at terminals in theCaribbean is open to third parties, with about double that volume held at other facilitiesthere that is committed on a more exclusive basis to specific term customers, consistingmainly of producer governments (see table above). The US Gulf Coast and Rotterdamareas also have significant independent storage capacity. Rotterdam has about 25- to 30-million barrels of crude oil storage that is specially dedicated to in-transit bonded stor-age outside of European Union customs.

Strategic Stocks: Seldom Seen

Over 1-billion barrels of crude oil is now held by governments around the

world as a strategic buffer against supply disruptions so serious that industry

stocks alone can�t handle them. These stores undoubtedly provide a measure of

psychological security for the oil markets and reduce the need for oil companies

CARIBBEAN CRUDE OIL STORAGE TERMINALS

(Crude Capacity In Million Bbls)

IndependentName Location CapacityBorco (PDV) Bahamas 6.5S. Riding Point Bahamas 5.2Wickland Aruba 10.0Statia Terminals St. Eustatius 5.0Total 26.5

Other*Bonaire (PDV) Bonaire 8.3Curacao (PDV) Curacao 10.0Hess US Virgin Islands 16.0Petrotrin Trinidad 8.0Total 42.3

*Not usually open to third-party storage.


to carry extra inventories as insurance against a loss of supplies. But the central

unresolved question that has existed almost since the inception of strategic

stocks remains: When should they be used? The largest stockpile is the US StrategicPetroleum Reserve, which is held in underground salt caverns on the US Gulf Coast. Itholds about 575-million barrels, and it has been drawn down slightly to pay for opera-tional improvements. The next-largest reserve at the end of 1993 was Japan�s almost 300-million barrels, held in onshore tanks by state JNOC. Germany and some other Europeangovernments also hold small stockpiles themselves in addition to compulsory stockingrequirements for their companies. Among non-OECD countries, South Africa has beencutting back its stockpile, which once stood at some 48-million barrels. South Korea alsohas a government-held strategic stockpile.

The International Energy Agency, which coordinates the efforts of OECD

countries to respond to oil-supply emergencies, has drawn up specific plans for

the withdrawal of strategic and compulsory stocks. In practice, however, the

decisions to use these stocks are mainly determined politically. The only

instance of a release of OECD strategic stocks due to an emergency was during

the 1990-91 Gulf conflict. The US and the IEA initially resisted releasing strategic stocksduring the autumn of 1990, when anxiety was greatest about the future availability of oilsupplies and prices were soaring. They argued that since there was no visible shortageof supplies, it was premature to draw down these stocks, despite rocketing prices. Asmall test of the US stockpile release system was conducted that autumn, and a coordi-nated sale was announced immediately after the start of the air offensive against Iraq.This was quite successful in helping to ease market fears of potential supply disruptionsand spurred an immediate drop in prices. However, the actual release of stocks was con-fined to the US SPR and was much smaller in volume terms than the oil made availableat the same time from floating stocks by Saudi Arabia and Iran.

Governments also face temptations to use strategic stocks for other purposes,

something they have succumbed to in the US, South Korea, and South Africa in

recent years. For example, in the spring of 1996, the US accelerated a planned opera-tional release of SPR inventories in order to control a politically unpopular rise in gasolineprices. In South Korea, the government has lent inventories to refiners during cold win-ters in order to allow them to supply additional products locally without being forced topay high prices on the international market, thereby putting pressure on the balance ofpayments and the currency. In South Africa, the lifting of UN sanctions has prompted asteady drawdown of strategic stocks that has been geared to coincide with periods of rel-ative market strength. However, these drawdowns seem to have been largely completed.

The stocks of the former Soviet republics and China cannot yet be tracked in

a systematic way due to a lack of available data, but they can have a significant

impact on world markets. In both cases the swings seem to reflect imbalances creat-ed by controls on trade and artificial internal pressures. These should decline to theextent that these countries move toward more open free-market systems.

Into The Refinery

The storage and transportation systems described above are all designed for the

smooth delivery of crude oil to refineries, where the feedstock can be turned into

usable products. It is this process that determines the ultimate value of a crude oil

and is the subject of the next and final chapter of the first section of the handbook.

CRUDE OIL HANDBOOK PIW © E1

RREEFFIINNIINNGG ��

WWhhaatt��ss AA CCrruuddee OOiill WWoorrtthh??

Regardless of the day-to-day vagaries of crude oil markets, the values of all

grades, and hence the prices reflected in markets, ultimately depend on the

refined products that can be made from individual grades. Crude oils have little

value in and of themselves except that they can produce refined products that

can be used by final consumers. Each refined product that can be produced from

a barrel of crude oil has its own separate markets, which are driven by their own

complex interactions of supply and demand. Thus, each grade represents a com-

posite of all of these markets, a composite that is unique to each grade because

of the variation in the mix of products that each grade yields. Unlike most othercommodities, there is no dominant end use for oil. Rather, there are a host of compet-ing co-product uses. The refining process is the technical means by which crude oil out-put is reshaped to fit the final product needs of oil consumers, and it has developed con-siderable flexibility since the late 19th century, when it was focused almost exclusivelyon kerosine production. The individual refined product markets are driven by a widerange of factors, including local product demand trends, interfuel competition, environ-mental regulations, inventory levels, weather, and refinery capabilities. A full analysis ofthis interaction goes beyond the scope of this book. In this chapter, the focus is morenarrowly on the basic characteristics of crude oil and how they relate to refining and thevaluation of grades.

Refinery technology offers a broad spectrum of tools for breaking down crude

oil into the products that consumers want. With various markets requiring dis-

tinct mixes of products from different combinations of crude oil feedstocks, a

wide variety of refinery configurations has developed over time. The most basic

distinction that is often drawn between types of refineries relates to their com-

plexity. A simple refinery involves only the distillation or boiling of the crude oil

and relatively few other processes, yielding large volumes of residual fuel oil,

especially from heavier grades. More complex refineries use various upgrading

processes and yield larger volumes of higher-value light products such as gaso-

line. The distinction between simple and complex refining is a relative term, with noexact specification for each category. However, the oil industry usually thinks in termsof three basic levels of complexity. A simple refinery today involves distillation of thecrude oil plus some common secondary processes that enhance the output of gasolineand diesel. A complex refinery takes the secondary processes a step further by using thegas oil and residue from the refining process as feedstock to make more light productssuch as gasoline and gas oil. These additional secondary processes include cracking andalkylation. A highly complex refinery simply adds more sophistication to these process-es, eating up even more of the heavy products through coking and other technologies.Some highly complex refineries are integrated with sophisticated petrochemical plants orlubricants plants that can also significantly enhance the value of a crude oil.

Due to regional differences in oil demand, the complexity of refineries tends

to vary around the world. Most of the simple refineries are in Asia, the former

E2 PIW © CRUDE OIL HANDBOOK

Soviet Union, and developing countries, where demand for light products is not

great and where significant volumes of residual fuel are still used for power gen-

eration. The most complex refineries tend to be in markets such as the US, where

gasoline demand accounts for almost one-half of all oil consumption. Western

Europe generally has complex refineries, but most are not as sophisticated as

those in the US, and product output is weighted more heavily toward gas oil than

in the US. There are, of course, important exceptions to these broad generalizations,particularly in the developing world, where oil-producing countries such as Venezuela,Saudi Arabia, and Kuwait have made extensive investments in highly sophisticatedrefineries in order to add value to their own crude oil flows by exporting large volumesof higher-value light products. Although Japan is an advanced industrial economy, it hasrelatively simple refineries. This is due mainly to the structure of domestic productdemand and the past protectionist government policies toward the country�s refiningindustry. In Asia in particular, many of the most rapidly developing countries are mov-ing toward greater refinery sophistication in an effort to keep up with quickly expand-ing demand for light products, especially middle distillates.

To illustrate the regional variation in refining capabilities, the chart and table

show various yields for Arab Light grade (see pH227). These range from simple

distillation to a highly

complex configuration.

The simple yield is fol-

lowed by representative

incremental yields for

Rotterdam, which is

somewhat complex, and

the US Gulf Coast, which

is the most complex of

the main regions. Theoutput of residual fueldeclines progressively asthe sophistication of therefinery increases. Theyield of higher-value lightproducts grows, but thecost of the additionalprocesses needed to makethem is also higher. Thisbasic trade-off lies at theheart of most major refinery investment decisions. The regional yields shown here weredeveloped by PIW to track refinery profitability in the main product markets around theworld by calculating the incremental product output of individual crude oils from repre-sentative regional refinery configurations.

A Look At The Refining Process

All of the various upgrading technologies are designed to maximize the prod-

uct output from a barrel of crude oil, but the starting point of the process is always

the same at every refinery: the distillation of the crude oil. This simply involves

Simple Rotterdam US Gulf Highly

Complex

0%

25%

50%

75%

100%

Light Ends

Mid-Distillates

Residue

COMPARING YIELDS FOR ARAB LIGHT

Products Simple Rotterdam US Gulf Highly ComplexLight Ends 11.7% 28.1% 51.6% 59.0%Mid-Distillates 32.8 33.0 18.4 28.0Residue 45.0 33.4 27.5 6.0

*Plus 4.9% coke.


heating the crude oil to gradually higher temperatures, which allows various

types of hydrocarbons to boil off at different points, thus breaking the crude oil

into purer products with similar chemical properties. At each temperature level, orcut point, a fraction of the crude oil reaches its boiling point, and these vapors are dis-tilled into a specific category of refined products. The determination of the cut pointsdepends both on the characteristics of the crude oil and the quality of the product beingproduced, which means that in practice there can be considerable variation. For example,kerosine, which is produced mainly from straight distillation and is prized for its puritywhen used as aircraft fuel, has cut points that range from an initial boiling point of 320-350 degrees Fahrenheit (160-176 centigrade) to a final cut point of 450-600 degreesFahrenheit (232-315 centigrade). At these temperatures, kerosine boils off and is segre-gated from the other oil products. The products with the lowest boiling points are lique-fied petroleum gases, which vaporize at normal atmospheric temperatures, followed atprogressively higher temperatures by gasoline, naphtha, kerosine, gas oil, and finallyunboiled residue � which, in a simple refinery, usually ends up as residual fuel oil.

Beyond the primary distillation level, some of the resulting products are used

as feedstocks for secondary processes, while others, such as kerosine, are sim-

ply used as they are or blended with still other products to provide the right qual-

ity supply for the market. Some of the simplest secondary processes are reform-

ing, which converts certain types of naphtha into gasoline, and hydrotreating,

which removes sulfur from gas oil and residual fuel. There are several variations tothese technologies, which are all fairly common in the simple refineries described above.Reforming in particular is widely used because of the importance of gasoline in manymarkets. Types of naphtha with relatively high content of hydrocarbons known as naph-thenes, which are readily broken down into high-octane aromatic compounds by thereforming process, are best-suited for reforming into gasoline. In contrast, highly paraf-finic naphthas are usually preferred as feedstocks for petrochemical manufacturing.Naphtha with 40% or more naphthenes and aromatics is usually defined as naphthenicor N+A naphtha, while naphtha with less than this amount is considered paraffinic.

Cracking is a more complex process that can involve several stages, which

together are designed to break lighter gasoline and gas oil fractions out of heavy

gas oil and certain kinds of residue. The two main cracking technologies are cat-

alytic cracking, or cat cracking, and hydrocracking. Both produce gasoline and

gas oil, but hydrocracking is more sophisticated and is sometimes preferred for

making middle distillates because it can produce kerosine as well as gas oil. Inboth, the residue and sometimes heavy gas oil from the distillation process, known as�straight-run� gas oil or resid, must be put through a vacuum distillation unit to prepareit for cracking. This unit simply distills the residue again at a lower atmospheric pressure,creating feedstock that is suitable for cracking, and that is known as vacuum gas oil, orVGO, and residue or vacuum bottoms that must go to the residual fuel oil pool. In a cat-alytic cracker, or cat cracker, the VGO feedstock and straight-run gas oil are combinedat high temperatures with a chemical catalyst that helps release the lighter hydrocarbons,leaving heavy, cracked residual fuel as a by-product. In a hydrocracker, much the samething happens, but hydrogen is also mixed in, which allows the creation of even morelight hydrocarbons and eliminates the cracked residue that is left over in cat cracking.

In both cracking technologies, the refiner has scope to alter the range of the

end products to tilt toward gasoline or gas oil. By changing the intensity or severity


of cracking, the refiner can shift a sophisticated unit�s output, adding flexibility to the refin-ing process. The output of these crackers often requires some special further processingat alkylation, isomerization, or reforming units to help maximize the output of gasoline.

The most sophisticated form of upgrading is coking, which involves the

destruction or complete transformation of the residue. Coking relies on intense

heating of residue � usually the cracked residue that is already left over from the

cat cracker � and rapid movement of the oil through a special coking drum

where the solid petroleum coke that is produced can be managed and removed,

while the lighter gasoline, naphtha, and gas oil fractions boil off. The processrequires high heat and spe-cial technologies but nocatalysts, and the coke,which is used mainly inindustrial processes, iseffectively the only residue.Thermal cracking and vis-breaking are similar tech-nologies, but they are lesssevere and still leave con-siderable volumes ofresidue. Thermal crackingis an earlier, more primitiveform of the coking processthat is mainly geared toward gasoline production from residue, while visbreaking is aless severe form of thermal cracking that extracts a small volume of gas oil from thecracked residue feedstock.

The feedstocks that are used in the upgrading units have become increasing-

ly important in refinery operations as the amount of upgrading capacity has

grown. These feedstocks now trade in active markets of their own. When the val-ues of key feedstocks such as vacuum gas oil and straight-run residue are relativelydepressed, the economics of operating upgrading units are good. But when supplies aretight, as they have been in recent years, upgrading economics become problematic.

Selecting And Valuing Crude Oils

Depending on the hardware that a refiner has available and the needs of the

downstream market that is being supplied, certain types of crude oils will be more

or less attractive depending on their individual characteristics. Obviously, the

grades that provide the highest profit margin are likely to find the most favor, but

as described in earlier sections of this book, some companies have term-contract

supply arrangements or equity crude oil production that tends to tilt their down-

stream refining systems toward certain grades. These are often considered baseloadcrude oil supplies, and refineries are usually designed with a specific grade or mix ofgrades in mind. Thus, there are plants that are geared toward light, sweet grades andplants geared toward heavy, sour oils. The latter contain the best upgrading units to dealwith the specific characteristics of those grades and maximize their product output.

While most refiners can count on certain baseload volumes, many are also

constantly evaluating their crude oil supply mix and the options available to

AN OVERVIEW OF KEY UPGRADING TECHNIQUES

Process Feedstock(s) OutputReforming Naphtha GasolineVacuum Distillation Straight-Run Residue Vacuum Gas Oil, ResidueCatalytic Cracking Vacuum Gas Oil, Gasoline, Gas Oil,

Straight-Run Gas Oil Cracked ResidueHydrocracking Vacuum Gas Oil, Gasoline, Kerosine

Straight-Run Gas Oil Gas OilVisbreaking Cracked Residue Some Gas Oil

and ResidueThermal Cracking Cracked Residue Light Products (Mainly

Gasoline) and ResidueCoking Cracked Residue Light Products and Coke


them to squeeze an extra bit of profit out of their plants. Their decisions to refine

these extra incremental volumes are driven by signals from the spot markets for

crude oil and refined products, and they can in turn have a big impact on these

markets. The incremental refining economics for each refiner are a bit different becauseof the varying configurations of their plants and their differing abilities to handle specif-ic grades. But in all cases, the incremental barrels face lower costs, because it is assumedthat the basic costs of owning and operating the plant are covered by the baseload vol-umes. In addition, the refinery generally cannot take full advantage of its upgradingpotential with incremental grades because some of its units are already fully loaded withbaseload crude oil supply volumes.

PIW�s system for tracking refined crude oil values, or �netbacks,� provides a

good example of the incremental refinery economics that are so crucial to spot

markets, and it also illustrates the kind of calculation that a refiner goes through

to determine whether it is profitable to refine incremental crude oil supplies. Arefinery netback is an oil industry term for the value of a specific crude oil based on theproducts that can be produced from it, less the cost of refining it and transporting it fromits port of loading. The netback value can be compared with the price of the crude oil inthe spot market or, for term-contract supplies, to determine the trend in refinery profitmargins. These netback values for selected grades appear in every issue of Petroleum

Intelligence Weekly and monthly in Oil Market Intelligence, and they are based on repre-sentative regional yields developed by PIW for individual grades. Unlike the incrementalyield of an individual refinery, they represent a composite for a key refining center suchas Rotterdam or the US Gulf Coast. These yields have been updated over the years toreflect the changing technical capabilities of refineries and shifts in the qualities of crudeoils. The table on page pE6 shows the latest yields, which were updated in 1996.

Calculating A Netback

Here�s how the PIW netback calculation works. The first step in assessing oil

market economics is to compute the weighted average value of all refined prod-

uct components from a barrel of crude oil at the refinery gate. In trade jargon, thisis known as the gross product worth, or GPW. This is determined by multiplying the pre-vailing spot price for each product by its percentage share in the yield of the total bar-rel of crude oil.

Following is a sample calculation of the gross product worth of a barrel of

Arabian Light crude oil refined at the US Gulf Coast, with the resulting products soldat spot market prices. The value of the fuel oil portion of the yield is partly determinedby its sulfur content. Therefore, an adjustment must be made when the sulfur level ofthe fuel oil produced from a given crude oil differs from the prevailing quality of fuelsold in the spot market. Generally, a refiner will blend fuels of various qualities to meetmarket needs. And higher-quality, low-sulfur residues have become particularly attrac-tive because they can be used as feedstock for upgrading units. In order to reflect this,the PIW netback calculation assumes that for higher-sulfur grades refiners receive ablending credit or debit of 50% of the value of each percentage point of sulfur, while forlow-sulfur fuel oil the credit or debit is 200%. The actual octane produced by a crudeoil�s gasoline cut also differs from spot market grades, and a credit or debit is applied toreflect this difference. This octane adjustment is only used in the US because of theimportance of gasoline yields, and it is based on the cost of natural gasoline.


To make com-

parisons between

the value of prod-

ucts that can be

processed from a

barrel of crude oil

at the US Gulf Coast

or another major

refining center and

the price of that

grade at the pro-

ducer�s loading

port, the costs of

transporting and

refining the oil

must be deducted.

In the case of crudeoils that are sold on adelivered basis, such as Russian Urals in Europe (see pH221), only refining costs needbe deducted. In some cases special tariffs, duties, and port charges and other fees mustalso be deducted. These are particularly significant in the US.

Since the PIW netback

model is attempting to assess

the economics of refining

the incremental rather than

the average barrel of crude

oil, transport and refining

costs also are figured on a

marginal basis. For crude oil

transport, this represents the

cost of chartering an appro-

priately sized tanker on the

spot market for a single voy-

age, as opposed to the cost of

operating refiner-owned vessels or chartering ships for an extended period. Theyardstick used to calculate the freight cost for a single voyage is known as the flat rate andis set by Worldscale, a trade association that publishes a base or �100� rate for voyagesbetween each oil loading and receiving port. Daily tanker market fluctuations are measuredin Worldscale �points,� whichare a percentage of the stan-dard flat rate. The cost of acharter at Worldscale 60would be 60% of the flat rate.For US Gulf deliveries, othercosts of transshipment or ligh-tering as well as tariffs andfees must also be deducted.

CALCULATING THE PRODUCT YIELDArabian Light Crude Oil At Typical US Gulf Coast Refinery, October 1996

US Gulf Coast Spot Prices Product Yield Value OfProduct Cents Per Gallon Per Barrel (Volume %) YieldRegular Unleaded Gasoline* 64.49 27.09 39.90% 10.81Jet Kerosine 70.26 29.51 8.20 2.42Gas Oil / No.2 Heating Oil 69.37 29.14 24.70 7.20Fuel Oil1% Sulfur 19.47 0.00 0.003% Sulfur 19.26 23.70 4.56

Actual Sulfur Content, 3.49%Fuel Oil Adjustment -0.10Actual Octane, 85.63Octane Adjustment -0.14Total Value Of Arabian Light�s Product Yield (GPW) 24.75

*87 octane. Note: Fuel oil adjustment based on a debit from 3% spot grade based on 50%of the slope between the 1% and 3% prices. Octane adjustment based on a debit thatreflects the extra cost of raising the octane to that of unleaded regular, based on the aver-age octane differential between unleaded regular and natural gasoline on the Gulf Coast.

CALCULATING FREIGHT & DELIVERY COSTVoyage Ras Tanura, Saudi Arabia to Beaumont, Texas

Flate Rate Per Metric Ton $18.08converted at 7.38 bbls per ton Per Barrel Of Arab Lt. $2.45

Spot Freight Rate Worldscale Points 53Spot Freight Cost

53% of flat rate Per Barrel $1.30Transshipment/Lightering Costs Per Barrel 0.34Other Costs Per Barrel 0.28Total Costs Per Barrel 1.92

Note: Other costs include US customs tariff of 11¢, Super Fund fee of10¢, and other state and local fees of 7¢.

THE NETBACK VALUETotal Refined Value Of Arabian Light (GPW) $24.75Less:

Incremental Refining Cost -0.35Freight & delivery Costs -1.92

Implied f.o.b. Value Of A Refined Barrel Of Arabian Light $22.48

Note: Incremental refining cost represents additional out of pocket operatingcost to refiner of running an additional barrel on top of baseload volumes.


Marginal refining costs are defined to include only running costs, with no

allowance for depreciation of the original capital in-vestment in the plant. ThePIW model assumes that they are 35¢ a barrel for a US or European refinery and 25¢elsewhere. A portion of the crude oil yield is assumed to be refinery fuel, and anothersmall amount is assumed to be lost during the refining process.

The entire netback calculation now comes into focus: Upon subtraction of

freight and refining costs, spot product prices are translated into an equivalent

crude oil value at the loading port of origin, known as the �f.o.b. netback.� It pro-vides a gauge of what a crude oil is worth at the point of sale to a typical refiner in aspecific downstream center.

The Profitability Of A Grade Of Crude Oil

The implied profit or loss for the refiner can easily be derived by comparing

the price of the crude oil in the spot market with its netback value (see bottom boxon pE6). If the netback value exceeds the cost of the crude oil under PIW�s yield and

(Please turn to pE9)

PIW PACESETTER CRUDE OIL YIELDS BY VOLUME

US GULF COAST � INCREMENTAL YIELDS AT TYPICAL REFINERIES

Winter Yields Quality AdjustmentsRegular Jet Gas Oil Low-Sulfur High-Sulfur Fuel Oil Gasoline

Crude Oil Unleaded Kerosine No.2 Fuel Oil Fuel Oil % Sulfur OctaneArab Light 39.9% 8.2% 24.7% ... 23.7% 3.49% 85.63Arab Heavy 36.8 6.7 9.7 ... 41.6 4.20 85.59Dubai 38.4 8.5 22.7 ... 26.9 3.50 86.81Kuwait 39.8 7.5 20.1 ... 28.8 4.56 86.24Bonny Light 44.9 7.8 39.6 4.5% ... 0.39 87.27Forcados 34.6 10.3 41.8 11.3 ... 0.40 88.10Brent 46.7 8.0 29.8 11.6 ... 0.83 86.45West Texas Intermediate 48.1 8.1 30.9 9.8 ... 0.89 86.96West Texas Sour 45.5 7.8 23.0 ... 20.1 3.23 87.16Maya 33.2 ... 7.0 ... 54.7 4.19 85.35Isthmus 42.4 8.2 21.0 ... 25.0 3.06 87.54Saharan 48.8 9.4 31.8 5.3 ... 0.41 86.10Louisiana Light Sweet 44.7 7.8 35.6 10.9 ... 1.40 87.02Cusiana 47.9 8.6 34.4 7.3 ... 0.80 86.92

Summer Yields Quality AdjustmentsRegular Jet Gas Oil Low-Sulfur High-Sulfur Fuel Oil Gasoline

Crude Oil Unleaded Kerosine No.2 Fuel Oil Fuel Oil % Sulfur OctaneArab Light 48.8% 5.6% 17.1% ... 24.5% 3.49% 85.63Arab Heavy 40.1 5.5 6.4 ... 42.7 4.20 85.59Dubai 46.6 7.2 15.6 ... 27.8 3.50 86.81Kuwait 47.3 6.4 13.9 ... 29.8 4.56 86.24Bonny Light 53.0 6.3 32.0 5.0% ... 0.39 87.27Forcados 46.4 7.7 31.0 12.6 ... 0.40 88.10Brent 56.5 6.0 22.1 12.9 ... 0.83 86.45West Texas Intermediate 57.5 5.9 22.2 10.5 ... 0.89 86.96West Texas Sour 51.5 6.2 18.4 ... 20.8 3.23 87.16Maya 35.7 ... 4.3 ... 55.3 4.19 85.35Isthmus 49.7 5.8 14.9 ... 25.9 3.06 87.54Saharan 55.7 7.5 25.4 5.6 ... 0.41 86.10Louisiana Light Sweet 51.3 6.2 28.4 11.6 ... 1.40 87.02Cusiana 55.0 6.8 27.4 7.7 ... 0.80 86.92


PIW PACESETTER CRUDE OIL YIELDS (Cont.)

NORTHWEST EUROPE/MEDITERRANEAN � INCREMENTAL YIELDS AT TYPICAL REFINERIES

Winter YieldsPremium Regular Jet Low-Sulfur High-Sulfur Fuel Oil

Crude Oil Unleaded Unleaded Naphtha Kerosine Gas Oil Fuel Oil Fuel Oil % SulfurArab Light 12.7% 8.7% 4.4% 7.7% 35.9% ... 24.3% 3.80%Arab Medium 11.5 8.4 4.4 5.0 31.6 ... 31.0 4.36Arab Heavy 11.1 8.0 4.4 7.5 23.5 ... 38.2 4.77Brent 18.6 12.4 4.4 8.0 37.0 12.7% ... 1.37Kuwait 9.4 11.9 4.3 7.5 28.0 ... 31.0 4.55Iran Heavy 13.7 9.3 4.3 7.5 28.0 ... 29.2 2.92Urals 13.8 9.3 5.0 7.5 36.2 ... 21.8 2.99

Summer YieldsPremium Regular Jet Low-Sulfur High-Sulfur Fuel Oil

Crude Oil Unleaded Unleaded Naphtha Kerosine Gas Oil Fuel Oil Fuel Oil % SulfurArab Light 16.6% 11.3% 5.6% 6.3% 29.4% ... 24.7% 3.80%Arab Medium 15.0 10.9 5.6 4.0 25.0 ... 31.6 4.36Arab Heavy 14.3 10.1 5.6 6.5 16.5 ... 39.0 4.77Brent 23.1 15.4 5.6 6.0 30.6 13.0% ... 1.37Kuwait 12.4 15.9 5.7 6.5 20.0 ... 31.7 4.55Iran Heavy 18.2 12.4 5.7 6.5 20.0 ... 29.9 2.92Urals 18.5 12.5 5.0 6.5 29.4 ... 22.0 2.99

SINGAPORE � INCREMENTAL YIELDS AT TYPICAL REFINERIES

Winter & Summer Yields Fuel OilCrude Oil Naphtha Kerosine Gas Oil Fuel Oil % SulfurArab Light 16.5% 23.2% 16.5% 40.0% 3.03%Arab Heavy 14.1 ... 25.1 56.7 4.37Dubai 16.2 22.8 14.5 42.7 3.13Iran Heavy 16.5 21.6 15.0 42.6 2.62Kuwait 16.7 20.2 13.3 45.8 4.20Oman 15.1 23.3 17.7 40.6 1.30Minas 10.0 17.2 26.6 43.5 LSWR

EXPORT REFINERIES

All Seasons Premium Jet- Gas Fuel Fuel OilCountry/Refinery/Crude Oil Naphtha Gasoline Kero Oil Oil % SulfurSaudi ArabiaYanbu/Arab Lt.-34 5.0 27.0 13.0 30.0 26.0 3.50%Jubail/Arab Lt.-34 17.0 4.0 18.0 33.0 26.0 3.50Rabigh/Arab Lt.-34 24.0 ... 11.0 14.5 48.0 3.50

BahrainBahrain/Arab Lt.-34 10.0 10.0 17.0 26.0 33.0 3.50

Abu DhabiRuwais/Murban-39 10.0 20.0 17.0 43.0 4.0 3.50

AlgeriaSkikda/Saharan-44 25.0 10.0 12.5 21.0 28.0 0.38

LibyaRas Lanuf/Es Sider/Zueitina 19.0 ... 7.0 29.0 40.0 0.57

VenezuelaAmuay/Bach.-17 6.0 27.0 ... 50.0 17.0 3.00Cardon TJ Lt.-31 2.5 33.5 ... 33.0 31.0 2.00Curacao TJ Lt.-31 ... 25.0 ... 30.0 36.0 2.00


cost assumptions, a refiner should be able to generate a profit by buying that particulargrade and selling the resulting products in the spot market. Clearly, this applies only ina generalized sense for each market, and it is not intended as a guide to assessing theprofitability of any individual plant or refiner. More important than the absolute level ofprofits is the trend in margins: If they are rising, refiners will be tempted to run morecrude oil, and spot market demand is likely to increase.

The dynamics of refining profitability at the margin create the underlying

trends that are most important in determining crude oil and product prices. Forexample, if a crude oil�s netback value falls below its price, refiners will tend to shy awayfrom it. This reduced demand will eventually bring the grade�s price down, or the reduc-tion in crude oil runs by refiners will tighten downstream markets and bring productprices up.

Types Of Crude Oils And Their Characteristics

In order to determine the attractiveness of an individual crude oil for refining

and compare it effectively with other grades, refiners and oil market participants

rely on detailed assays of actual cargoes. These crude oil tests are performed

using similar kinds of standardized techniques and scales of measurement, and

through repeated testing

they can also show how

an individual crude oil

stream is changing over

time. As part of the

descriptions of each of

the main grades in inter-

national trade in the fol-

lowing section, repre-

sentative assays are also

provided. While not ascomplete as a full test,these assays give the maincharacteristics that refinersand traders tend to refer toin evaluating the quality ofa crude oil. The assayscome from a wide range ofindustry sources includingmajor oil companies, refin-ers, and producing countrygovernments. They gener-ally provide good approxi-mations of the characteris-tics of the individual crudeoil streams, and if the quality of a grade is known to have changed significantly sincethe test that is shown, this is usually noted in the profile of the crude oil.

As an introduction to the following discussion of specific crude oil character-

istics, all grades can be defined in terms of a handful of broad categories, depend-

BROAD QUALITY CLASSIFICATIONS FOR CRUDE OILS

SulfurSweet Medium Sour Sour

(0.0-0.5%) (0.5-1.5%) (1.5-3.0+%)Gravity Naphthennic High PourLight Saharan40 API Ekofisk Sarir Murban

Brent OlmecaEs Sider Berri

Bonny Lt.Oseberg Oman

Medium Minas Flotta Isthmus33 API Cabinda Arab Light

Djeno DubaiGullfaks C. Limon Arab MediumForcados Oriente Iran Heavy

Bonny Med. ANS Arab Heavy

DuriShengli

Heavy Belayim22 API Maya

BachaqueroBoscan


ing mainly on their gravity and sulfur content. Crude oils are usually thought of

as ranging from light to heavy in gravity and sweet or low-sulfur to sour or high-

sulfur. These two continuums or parameters define the broad categories into

which all crude oils tend to fall. The gravity of crude oils is typically measured interms of a scale set by the American Petroleum Institute, in which lighter grades are des-ignated by higher values. Sulfur content is usually measured in the percent by weightthat occurs in the oil, with higher values indicating more sulfur. Other key characteris-tics for sweet grades include their pour point, or the temperature at which they begin toflow readily. High naphthenic content, which is most important in the naphtha fractions,is a critical determinant of the gasoline-manufacturing capability of a crude oil. Similarly,high paraffinic content is critical for use of naphtha in petrochemical manufacturing.

The matrix above shows the broad categories of crude oil types and repre-

sentative grades within each category. There are no extremely light, high-sulfur

grades, and relatively few heavy, low-sulfur grades. Thus, Arab Light is only

described as a light crude oil in reference to other sour grades, not in reference

to the much lighter low-sulfur or medium-sulfur grades. These broad categories

provide useful boundaries or groupings for comparing streams. Comparisons ofspecific crude oil characteristics between individual grades that fall in different categoriesare generally less useful than comparisons between more similar supplies within thesame general group. Refiners are also in practice more likely to evaluate the relative mer-its of similar types of crude oils because of the basic preferences of their plants for sweetor sour grades or light or heavy grades.

How To Read A Crude Oil Assay

Beyond the broad distinctions provided by measures of crude oil gravity and

sulfur content, there are a host of other tests that apply to both the raw or whole

crude oil and to the various cuts of refined product that can be separated through

straight atmospheric distillation. The characteristics of these various refined fractionsprovide good indications of their suitability for use as finished products or as feedstocksfor secondary refining processes.

Among the most important tests of the raw crude oil are those for pour point

and viscosity. Both provide indications of how easy the crude oil is to handle and

refine. As mentioned above, the pour point is the temperature at which the grade pourseasily. Grades that are high in wax, such as Libyan Sarir, Angolan Cabinda, andIndonesian Minas (see pH155,H33,H125), have relatively high pour points because thewax in them tends to solidify at atmospheric temperatures, making them more difficultto handle both in pipelines and on ships. Viscosity is a measure of how well an oil flowsabove its pour point. At higher temperatures, crude oils tend to flow more easily, andhence their viscosity declines. There are two basic parameters in measuring viscosity: thetemperature of the measurement, and the viscosity index. There are five main scales formeasuring viscosity: the kinematic scale used in most of the following assays, which usesunits known as centistokes and is the most universally recognized, and the Redwood(UK), Engler (Europe), and two Saybolt (US) scales. In all cases, higher viscosity read-ings indicate more resistance to flow.

Other important specifications of the raw crude oil include its volatility, mea-

sured by a test known as Reid vapor pressure; its acidity and toxicity, which can

be measured by hydrogen sulfide content; total acid number; and other tests.


These characteristics also have a direct effect on the handling and refining char-

acteristics of the crude oil. RVP is usually measured in pounds per square inch at 100degrees Fahrenheit, with higher values indicating greater volatility or a greater tendencyto vaporize. RVP tends to be relatively low in most crude oils except the lightest ones orsome condensates. Hydrogen sulfide is typically measured in parts per million, and it canbe extremely dangerous at higher levels because it is poisonous to humans and its acid-ity makes it highly corrosive, requiring special handling procedures and equipment.

The most important test of a crude oil beyond the measuring of its gravity and

sulfur content is atmospheric distillation, which indicates the yields of various

refined products at specific temperature ranges or cut points. Lighter-gravity

grades always produce larger shares of light products, but the atmospheric dis-

tillation test indicates the specific shares of individual light products that a crude

oil yields. It also allows further testing of the characteristics of the individual productsthat can be generated from a specific crude oil, which is a key part of the assay. Theyield of products can be measured in terms of volume or weight, which provide slight-ly different results. As the heat increases, the lighter products boil off, with liquefiedpetroleum gases vaporizing at the lowest temperatures, followed by gasoline, naphthas,kerosine, and gas oils, which are the heaviest distillates. The oil that remains after thedistillation process, usually at temperatures above 350-380 degrees centigrade, is knownas residue. The cut points for these various products can vary depending on the specif-ic test, and there may be more fractions broken off, but they still usually fall into thesesame general categories.

Gasoline

Each of the individual products broken out through distillation has key spec-

ifications that determine its potential value as a finished product or a feedstock.

Distillation rarely produces much product that can be considered finished gaso-

line because further processing through reformers and other units is usually

needed. But the lightest naphtha fractions of most grades are often used directly

in the gasoline pool. For these gasoline fractions, the most important character-

istic is octane, which measures the tendency of the fuel to ignite prematurely in thecombustion process, causing the engine of the vehicle that is burning the fuel to knockand operate inefficiently. The higher the octane number, the less the fuel is prone toknocking. Two scales are usually used: research octane and motor octane. The researchoctane number (RON) of most of the atmospheric gasoline or light naphtha fractions inthe crude oil assays are generally somewhat below the usual commercial standard of 80-100 octane, and thus require the blending in of octane-boosters to meet these standards.Refining processes, such as naphtha reforming and alkylation, and additives, such as leadand MTBE, are commonly used to raise octane levels.

Naphtha

The key characteristics of naphtha that determine its suitability for either

gasoline manufacturing or for use as a petrochemical feedstock are the relative

quantities of three basic types of hydrocarbons: paraffins, naphthenes, and aro-

matics. Aromatics generally have high octane values and are good for making gasoline,and naphthenes can be readily converted to aromatics through reforming. Naphthas thatare rich in these two hydrocarbons, with a combined content of 40% or more, are usu-


ally good for making gasoline and are sometimes referred to as high N+A naphtha. Forexample, the naphtha cut from a gasoline-rich grade such as Bonny Light has anextremely high N+A of 67% by weight (see pH183). Paraffins can also be converted tohigher-octane hydrocarbons through reforming, but less efficiently than naphthenes.Naphthas that are highly paraffinic are often more desirable as feedstocks for petro-chemical manufacturing, where they are used for cracking into ethylene, a basic build-ing block for more specialized petrochemicals.

Kerosine

Kerosine is the lightest of the middle distillates, and it plays a dual role as a

blendstock for heavier gas oil fractions and as a fuel in its own right. As jet fuel,its key characteristics are its sulfur content, smoke point, and freezing point. Due to theextreme cold of high altitudes, commercial jet fuel requires kerosines that have freezingpoints of -40 degrees centigrade or lower. The sulfur content is usually 0.3% or lessdepending on the specific commercial specification. These same characteristics are alsovaluable when it is used as a blendstock to enhance the cold-weather properties of gasoil. As a fuel for home heating or cooking, which is its most common use in Asia, it doesnot need to meet such high specifications.

Gas Oil

For gas oil, key characteristics include its cetane index, sulfur content, and

viscosity. Cetane, like octane, is a measure of the efficiency of gas oil as a fuel for

diesel engines. It measures the ability of the fuel to self-ignite under pressure, withhigher values indicating better quality. Most commercial diesel fuels require a cetaneindex of at least 40-45, with the best-quality fuels at 50 or above. Kerosines used forblending into diesel are usually at 50 or more.

Sulfur content is a critical environmental specification for gas oil, and specifi-

cations are being tightened by new regulations in many markets. Thus, standards

for sulfur content vary regionally. Typical specifications range from 0.3% or more inmany developing countries to as low as 0.05% for diesel fuel in the US and the EuropeanUnion. Japan is moving to a similarly tight specification in 1997, and some other Asiancountries are not far behind. As described above in relation to the characteristics of wholecrude oil, viscosity measures the ability of the fuel to flow at different temperatures,which is critical both for its handling and as an indication of how suitable it is for upgrad-ing or how easily it can burn. Cloud point is another key characteristic of middle distil-lates, and it is especially critical for diesel fuel because it indicates the temperature atwhich paraffins begin to crystalize in the fuel, potentially clogging engine filters. Dieselfuel�s usual commercial maximum cloud point is about 10 degrees Fahrenheit.

Residue

Viscosity and sulfur content are among the most important specifications for

atmospheric residue. To be used as fuel, most residue must be heated and some-

times blended with other oils to improve its handling characteristics. Viscositystandards for high-sulfur residual fuel vary from 380-420 centistokes in Europe and theMideast to 180 centistokes in Singapore. Some grades, such as Asian low-sulfur waxyresidual fuel, have extremely high pour points in excess of 100 degrees Fahrenheit (37.8degrees centigrade). Sulfur content also varies regionally, with high-sulfur fuels in the US


starting above 1%, while in Europe, the low-sulfur fuel grade is 1%, and high-sulfur is3.5%. As indicated in the earlier section on netback calculations, blending is oftenrequired to meet the commercial fuel oil specifications for sulfur content.

Other characteristics also help a refiner to determine whether the residue is

suitable for upgrading, asphalt manufacturing, or other uses. High asphaltene con-tent is an indication that the residue is likely to be a good feedstock for making asphaltbecause it has good binding characteristics, but an abundance of asphaltene can makefor an undesirable fuel. For example, Mexican Maya produces residue with a highasphaltene content of 13.8% (see pH173). Metals content is a key obstacle to upgradingprocesses, especially to cracking technologies that rely on catalysts. In addition, residueswith relatively high levels of the metals vanadium and nickel can pose problems as boil-er fuels. The Conradson carbon residue test provides an indication of how much coke aresidue produces in the coking process, with lower values generally considered moreattractive because they imply a higher yield of light products. The aniline point is anoth-er measure of cracking capabilities, with a higher value indicating greater potential forproducing light products.

Choosing A Crude Oil

In taking this wide range of quality considerations into account, a refiner

must also evaluate transportation alternatives and the price dynamics of the mar-

ket before deciding the best grades for making the slate of products that are

required downstream. With over 100 crude oils in international trade, the choic-

es can be quite daunting, as indicated by the section on crude oil profiles (see

Chapter H). In practice, though, refiners can often be quite conservative in their

choices of crude oil feedstocks. This caution derives from a combination of factors.Refineries generally use a few particular grades of crude oil, which creates a natural biasin favor of these grades. The complex quality of the grades and the refining process alsomeans that a new grade can produce unexpected results. Logistical considerations canalso create serious obstacles. It is often safer, then, to stick with familiar grades ratherthan experiment. The tables in Chapter G of the reference section outlining crude oilcontracts by company and US crude oil imports by company show that refiners vary con-siderably in terms of the diversity of crude oils that they rely upon. However, refinerswith greater upgrading capability can generally handle a wider variety of grades becauseof their greater flexibility. Simple refineries tend to be biased in favor of light, sweetgrades, while more complex plants can handle heavier, sour oils as well as the higher-quality grades.


API gravity. A measure of the weight of hydrocarbons according to a scale establishedby the American Petroleum Institute. Crudes with higher values are lighter and tendto produce larger volumes of high-value lighter products in atmospheric distillation,which makes them relatively more valuable. Crudes that are lower on the API scaletend conversely to be less highly valued because they produce smaller yields oflighter products.

assay. A laboratory assessment of the characteristics of a crude oil that help determineits market value and refining capabilities. Assays of some kind are usually required aspart of all crude oil sales.

atmospheric distillation. The primary phase of all refining in which crude oil or otherraw feedstock is boiled and the vapors are collected and condensed to create basicpetroleum products.

backwardation. A relationship between prices in which the cost of prompt, immediatelyavailable supplies exceeds the price of volumes available in the future. Oil marketshave been in backwardation for much of 1995 and 1996.

benchmark crude. A crude that is traded regularly enough in the spot market that itsprice quotes are relied upon by sellers of other crudes as a reference point for set-ting term or spot prices. Brent, West Texas Intermediate, and Dubai are all bench-mark crudes.

Brent market. A widely traded group of spot, forward, and futures markets in North SeaBrent crude that emerged in the early 1980s. They are used as a key source of inter-national oil price risk management and as a benchmark for crude oil pricing underboth term and spot transactions. Forward trading extends several months ahead withsupplies becoming �wet� at least 15 days prior to loading. A parallel futures marketin Brent also exists on London�s International Petroleum Exchange.

bunker fuel. Oil consumed as fuel by ships � usually residual fuel oil but sometimesdiesel.

CFD. See contract for differences.

catalytic cracking (cat cracking). A secondary refinery upgrading process that convertsheavy processed feedstocks such as vacuum gas oil into lighter products such asgasoline by passing the feedstock over a heated catalyst in order to break down, orcrack, the heavy hydrocarbons into lighter ones.

cetane number. A measure of the ignition quality of diesel fuel that indicates the ten-dency of the oil to ignite spontaneously under pressure, which is a desired charac-teristic for diesel engines but not for gasoline engines.

c.i.f. (cost, insurance, and freight). A price that covers delivery to a specified destination andinsurance for that transportation. If insurance is not included it is referred to as C&F.

GGlloossssaarryy OOff TTeerrmmss


coker. A deep-conversion refinery unit that cracks feedstock severely at high tempera-tures. It takes low-quality residue and transforms it into light products and petroleumcoke, completely destroying the resid.

con-carbon number (conradson carbon or CCR). A measure of the amount of unwant-ed carbon produced in the refining process, with higher values indicating a less desir-able feedstock.

condensates. Liquid hydrocarbons that are produced in conjunction with natural gas.They are chemically more complex than liquefied petroleum gases and are sometimessimilar to crude oil or naphtha.

contango. The reverse of backwardation. A relationship between prices in whichprompt, immediately available oil sells at discount to future supplies. Oil marketswere in contango during most of the first half of 1990.

contract for differences (CFD). A financial arrangement used in swaps and otherfinancial dealings in which the arithmetic difference between two similar but oppo-site transactions is exchanged rather than the total amounts involved. The term CFDis used especially in oil to refer to these types of price swaps in the short-term Brentcrude market, which provide a way to hedge the difference in price between spotsupplies known as �dated� and first-month forward supplies known as �15-day.�

cracked residue. The residual oil that is left over after the cracking process. Usuallyonly suitable for use as residual fuel oil or as feed for a coker. (See cracker.)

cracker. An upgrading unit that converts heavier oils into light products by means of acatalyst (a catalytic or cat cracker) or by means of adding hydrogen in the presenceof a catalyst (a hydro-cracker).

crack spread. A set of futures market transactions that attempts to simulate the com-mercial position of a refiner as a buyer of crude and a seller of refined products. Thepurpose is to duplicate the profit margin that exists in refining. The most popularcrack spread on Nymex is known as the �3-2-1,� or the purchase of three crude con-tracts against the sale of two gasoline contracts and one heating oil contract. This rela-tionship may be reversed in winter when heating oil is in greatest demand.

crude oil. Petroleum in its raw state as it emerges from the ground with only minor pro-cessing to remove associated natural gas and gas liquids. This processing is usuallydone at or near the production site. Some synthetic oils that are produced from tarsands, extra heavy oils, or types of shale are refined like crude oil. Condensates arealso very similar to crude oil, but usually lighter, and they are often refined like them.

deadweight tonnage. A rough measure of the carrying capacity of a tanker.

demurrage. An extra payment due to a ship owner if a tanker is forced to wait beforeloading or discharging.

derivatives market. A market where the value of the contract being traded is derivedfrom an underlying commodity such as crude oil. These markets typically involve for-ward purchases or sales and can take the form of futures markets or over-the-counterswaps and options.


Dubai market. A widely traded international forward market in Mideast Dubai crudethat emerged in the mid-1980s and is used as both a risk-management tool and abenchmark for crude oil pricing East of Suez. Forward trading usually extends for twoor three months. Formal futures trading contracts have been attempted unsuccessful-ly by Singapore�s Simex and London�s IPE (see entries).

f.o.b. (free on board). A price that only covers the cost of the material and the loadingof it onto a ship or into a pipeline prior to transportation. Transportation and insur-ance are the responsibility of the buyer.

formula price. A price for crude oil, usually in a term contract, that is determined by aspecified relationship to a benchmark crude or a group of benchmark crudes or prod-ucts. The formula also usually specifies the time lag from the point of loading atwhich the price is determined, the exact average to be used, and other variables.

forward market. An informal market that trades in the future delivery of a specific typeof oil, with only some transactions resulting in physical delivery. Unlike a futures mar-ket, regulation is much less strict, and there is no clearinghouse or margin payments.These conditions tend to restrict trading to large oil companies and financial entities.(See �Brent market� and �Dubai market.�)

futures market. A formal exchange that trades contracts for the delivery of a specifictype of oil in future months. Only a very small volume results in physical delivery,and in some markets, there is only cash settlement. The presence of a clearinghouseand regular daily margin payments on all positions ensures the financial integrity ofthe operation at all times. The market is open to all participants.

gas oil. A heavier middle-distillate product that is produced at higher temperatures thankerosine and lower temperatures than residual fuel. Usually used as diesel fuel orhome heating oil.

gasoline. A light distillate product that is usually produced through the reforming ofnaphtha, cracking of heavier products, and blending. It is the goal of most secondaryrefinery upgrading technologies. Used for internal combustion engines.

hedge. A position in a derivatives market that is designed to reduce price risk from aphysical transaction. For example, the sale of a derivative in anticipation of futuresales of physical supplies of oil or gas provides protection against possible declinesin the price of the physical commodity.

hydro-cracking. A secondary refinery upgrading process similar to catalytic crackingthat converts heavy processed feedstocks such as vacuum gas oil into lighter prod-ucts such as gas oil, kerosine, and gasoline by passing the feedstock over a heatedcatalyst in the presence of hydrogen in order to break down, or crack, the heavyhydrocarbons into lighter ones and add carbon molecules to make the output lighter.

IPE. International Petroleum Exchange. A London oil futures market trading gas oil andBrent crude as well as options.

kerosine. A middle-distillate fraction that is produced at higher temperatures than naph-tha and lower temperatures than gas oil. It is usually used as jet turbine fuel andsometimes for domestic cooking, heating, and lighting.


light naphtha. A category of naphtha that can be rich in paraffins and is used for eth-ylene cracking to make petrochemicals. However, if it is rich in aromatics and naph-thenes it is used for reforming into gasoline or as blendstock for making gasoline.

liquefied petroleum gas (LPG). A class of light hydrocarbons that are gaseous atatmospheric pressure but can be liquefied easily under pressure. They are producedas part of the refining process and also in conjunction with the production of crudeoil and natural gas. They can be used both as a fuel and as feedstocks for makingpetrochemicals and other products. The two types are propane and butane.

LPG. See liquefied petroleum gas.

liquidity. In the oil market context, this refers to the volume of trading activity anddiversity of participants in a particular arena. Greater liquidity allows trades to be exe-cuted quickly and easily at a uniform price; a lack of liquidity tends to prevent someinterested participants from finding a buyer or seller at a given time. High-volume oilfutures markets are the most liquid.

margin. For a refiner, the operating profit as measured by the difference betweenrefined product prices and crude feedstock costs.

marker crude. A widely traded crude that is used as a reference point for setting theprices of other crudes (see �benchmark crude�).

metals content. A measure of the content of nickel, vanadium, iron, or other metals.High metals content can affect the fuel curning or upgrading characteristics of a crudeor residue.

naphtha. One of the lightest cuts of the atmospheric distillation process that is vapor-ized at a temperature range of 5-165 degrees centigrade. Naphtha can be used as afeedstock for both gasoline manufacturing and petrochemicals depending on its qual-ity, with light or paraffinic naphtha usually used in petrochemical plants and heavyor N+A naphtha usually used in reformers at refineries to make gasoline.

natural gas. Naturally occurring hydrocarbon gas that is predominantly methane and isproduced both in conduction with crude oil or separately. The methane, or dry gas,can occur with varying amounts of natural gas liquids, mainly ethane, pentane, andLPG, as well as condensates. These liquids are typically stripped from the methane aspart of the production process. While methane is a highly desirable fuel, natural gasliquids can also be used as feedstocks for petrochemicals and other refining process-es as well as for fuels.

natural gas liquids (NGLs). The slightly heavier hydrocarbons produced with naturalgas such as ethane, propane, butane, and pentane, or natural gasoline. These hydro-carbons are usually liquid or can be easily turned into liquids under moderate pres-sure. They can be used both as fuels and feedstocks. LPG is one of the main cate-gories of NGLs.

netback. A calculation of the value obtained from the processing of a crude oil. It isderived from the yield of the refined products, prevailing refined product prices, andcrude oil processing and transportation costs. It allows the comparison of the valueof a crude to a refiner with the market price for the crude oil.


NGLs. See natural gas liquids.

Nymex. New York Mercantile Exchange. Futures market trading light crude oil (WestTexas Intermediate), unleaded gasoline, heating oil, propane, natural gas, andoptions.

octane rating. A quality specification for gasoline that measures its tendency to ignitespontaneously creating engine knock and causing the engine to operate less effi-ciently. Two basic rating systems exist: the research octane number, or RON, and themotor octane number, or MON. In both cases a higher number means better quality.Lead has traditionally been used as a low-cost additive to raise the octane number ofgasoline, but it has been banned in many countries for health reasons, requiring theuse of other high-octane additives.

option. A derivative instrument that provides the right to buy or sell a commodity at agiven price sometime in the future. The buyer then can choose whether or not toexercise the option depending on market conditions and investment strategy.

over-the-counter instrument. A derivative or other financial instrument that is cus-tomized for the individual buyer as opposed to being traded on a uniform basis inan organized exchange such as a futures market.

pour point. The temperature at which a crude oil or refined product such as residualfuel flows. Some crudes and residual fuels must be heated in order to remain liquid,which is expressed as a high pour point, meaning that they can be difficult to han-dle and may require heated storage or tankers.

paper barrels. A generic term for oil that is bought and sold in forward or futures mar-kets; thus, it involves commitments to make future deliveries rather than exchange ofactual physical supplies (see �wet barrels�).

reformer, reforming. In refining this usually refers to the process of catalytic reform-ing in a reformer unit, which uses heat and pressure in the presence of catalysts toconvert naphtha feedstock into higher octane gasoline blending components or refor-mate. This is done mainly by converting lower-octane naphthenes into higher-octanearomatics.

Reid vapor pressure (RVP). A measure of the volatility of petroleum products that isdone by testing vapor pressure at 100 degrees Fahrenheit in pounds/square inch.

Simex. Singapore International Monetary Exchange. A futures market that trades oil con-tracts in high-sulfur residual fuel as well as the IPE Brent contract.

sour crude. Usually a crude oil that has a sulfur content that is greater than 0.5%. Thishigher sulfur content affects the quality of the resulting refined products and some-times means extra processing is required. It is referred to as sour because of theunpleasant smell of the sulfur.

spot market. A market for immediately available single cargoes or other small lots ofphysical crude oil or refined petroleum products.

spread. A relationship between two prices, either for the same grade of oil at differenttime periods or for different grades of oil. These price relationships lie at the heart of


much current oil trading since they tend to be less volatile than absolute movementsin prices. Spreads also define the relative trends of prices between different marketsand over time. (See �backwardation� and �contango.�)

straight-run. A term used to describe any refined product that emerges from the initialrefinery distillation of crude oil.

straight-run gas oil. A middle distillate that is produced from refinery distillation attemperatures usually ranging from 200-350 degrees centigrade. It usually is used forheating oil or diesel fuel.

straight-run residual oil or residue. The remaining portion of the crude oil feedstockthat does not vaporize in the refinery distillation process. This product can be useddirectly as a boiler fuel, or it can be used as feedstock for vacuum distillation units.

sulfur content. A measure of the presence of sulfur in crude oil, which is a key deter-minant of quality. Sulfur content is measured as the percent of sulfur by weight in thecrude. Crudes that are high in sulfur are referred to as sour crudes, and those that arelow in sulfur are referred to as sweet crudes.

swap. A financial risk-management tool in which two parties exchange differing marketrisk exposures in order to be assured of a fixed or predictable price, usually for anextended period of years. It may also involve short-term instruments in which risk ismanaged by the swaps provider rather than absorbed by a counterpart.

sweet crude. Usually a crude oil that has a sulfur content that is 0.5% or less by weight.Lower sulfur content improves the quality of the resulting refined products, and sweetcrudes does not require as much processing as sour crudes. They are referred to assweet because of the absence of an unpleasant sulfur smell.

term contract. A sales contract that specifies set price terms for the purchase of sever-al cargoes of oil over a particular period in contrast to a spot transaction, whichinvolves only a single cargo. Pricing, volume, and timing can all be quite flexible,with the essence being a continuing, regularized commercial relationship.

transparency. In relation to a market, this refers to the tendency for price signals andother market information to be easily visible to all participants and for market pres-sures to be quickly reflected in price levels.

ullage. The unoccupied space in a storage tank that is still available for use.

vacuum distillation. A secondary refining process in which straight-run residue is dis-tilled in a vacuum in order to separate more light hydrocarbons than through atmos-pheric distillation. The output of the process is vacuum gas oil, which can be used asfeedstock for cracking units, and vacuum bottoms or residue, which are usually usedas boiler fuel.

vacuum gas oil (VGO). The lighter product manufactured from the secondary refiningprocess known as vacuum distillation. Vacuum gas oil is a preferred feedstock for usein cracking units to produce gasoline and gas oil.

viscosity. A measure of the ability of a liquid such as crude oil to flow. Viscosity is mea-sured at a wide range of temperatures according to several different scales. The main


scales are Kinematic, Redwood, Engler, and Saybolt. This is a critical characteristic ofcrude oil and residual fuel because it affects its handling.

VLCC (very large crude carrier). A class of tanker with deadweight tonnage, or carryingcapacity, of 200,000 tons or more. This is the usual size of tanker used to carryMideast and other grades on long-haul voyages. Some ports and key canals such asPanama and Suez cannot handle these ships when fully laden.

West Texas Intermediate market. The US spot crude oil market for West TexasIntermediate crude, which provides the foundation for the actively traded New YorkMercantile Exchange light sweet crude futures contract. The main delivery points forspot trading are Cushing, Oklahoma, the base for the Nymex crude contract, andMidland, Texas.

wet barrels. A term that distinguishes the trading of physical oil supplies from the for-ward or futures transactions. Spot markets typically involve �wet barrel� transactionsthat result in the delivery of oil.

RReeffeerreennccee SSeeccttiioonn::PPrrooffiilleess,, TTrraaddee,, AAnndd PPrriicceess


F. Country Profiles � How Countries Market Their Crude Oil . . . . . . . . . . . .F1

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F1

Country Profiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F2

G. Term Contracts And Trade Flows By Country And Company . . . . . . . . .G1

PIW�s Term Deals By Producing Nation . . . . . . . . . . . . . . . . . . . . . . . . .G3

PIW�s Term Deals By Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G15

US Crude Oil Imports By Company And Country Of Origin, 1991-95 . . .G33

US Crude Oil Imports By Country Of Origin And Company, 1991-95 . . .G40

H. Crude Oil Profiles � A View Of the Market Through Each Grade . . . . . .H1

The Crude Oils And Their Key Characteristics . . . . . . . . . . . . . . . . . . . .H3

Crude Oil Streams Ranked And Indexed By Gravity . . . . . . . . . . . . . . . .H7

Crude Oil Streams Ranked And Indexed By Sulfur Content . . . . . . . . . . .H8

Crude Oil Streams Ranked And Indexed By Volume . . . . . . . . . . . . . . . .H9

Crude Oil Streams Indexed By Name . . . . . . . . . . . . . . . . . . . . . . . . . .H11

Crude Oil Profiles (Alphabetical By Country) . . . . . . . . . . . . . . . . . . . . .H13

I. Prices � Spot And Term Contract Prices For Key Grades . . . . . . . . . . . .I1

Key Crude Oil Benchmarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .I3

Spot Assessments For Various Crude Oil Grades . . . . . . . . . . . . . . . . . . .I5

PIW Scorecard � Costs To Refiners Of Key Formula Priced Crude Oils

In Primary World Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .I11

PIW Scorecard � Term Contract Prices At Port Of Loading . . . . . . . . . .I17

CCoouunnttrryy PPrrooffiilleess


How Countries Market Their Crude Oil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F1

Country Profiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F2

Abu Dhabi . . . . . . . . . . . . . . . . . . .F2

Algeria . . . . . . . . . . . . . . . . . . . . . .F3

Angola . . . . . . . . . . . . . . . . . . . . . .F4

Argentina . . . . . . . . . . . . . . . . . . . .F5

Australia . . . . . . . . . . . . . . . . . . . .F5

Brunei . . . . . . . . . . . . . . . . . . . . . .F6

Cameroon . . . . . . . . . . . . . . . . . . .F7

Canada . . . . . . . . . . . . . . . . . . . . .F7

China . . . . . . . . . . . . . . . . . . . . . . .F9

Colombia . . . . . . . . . . . . . . . . . . .F10

Congo . . . . . . . . . . . . . . . . . . . . .F11

Dubai . . . . . . . . . . . . . . . . . . . . . .F12

Ecuador . . . . . . . . . . . . . . . . . . . .F13

Egypt . . . . . . . . . . . . . . . . . . . . . .F14

Gabon . . . . . . . . . . . . . . . . . . . . .F15

Indonesia . . . . . . . . . . . . . . . . . . .F15

Iran . . . . . . . . . . . . . . . . . . . . . . .F17

Iraq . . . . . . . . . . . . . . . . . . . . . . .F18

Kuwait . . . . . . . . . . . . . . . . . . . . .F19

Libya . . . . . . . . . . . . . . . . . . . . . .F20

Malaysia . . . . . . . . . . . . . . . . . . .F21

Mexico . . . . . . . . . . . . . . . . . . . . .F22

Neutral Zone . . . . . . . . . . . . . . . .F23

Nigeria . . . . . . . . . . . . . . . . . . . . .F24

Norway . . . . . . . . . . . . . . . . . . . .F25

Oman . . . . . . . . . . . . . . . . . . . . . .F26

Papua New Guinea . . . . . . . . . . .F27

Qatar . . . . . . . . . . . . . . . . . . . . . .F28

Russia . . . . . . . . . . . . . . . . . . . . .F28

Saudi Arabia . . . . . . . . . . . . . . . .F30

Syria . . . . . . . . . . . . . . . . . . . . . .F32

United Kingdom . . . . . . . . . . . . . .F33

United States . . . . . . . . . . . . . . . .F34

Venezuela . . . . . . . . . . . . . . . . . .F35

Vietnam . . . . . . . . . . . . . . . . . . . .F37

Yemen . . . . . . . . . . . . . . . . . . . . .F37

CRUDE OIL HANDBOOK PIW © F1

CCOOUUNNTTRRYY PPRROOFFIILLEESS ��

HHooww CCoouunnttrriieess MMaarrkkeett TThheeiirr CCrruuddee OOiill

The world�s crude oil exporting countries are a broad and diverse group, each

with its own unique market circumstances and objectives. Of the almost a dozen

countries in the group that exported 1-million barrels a day or more of crude oil

in 1996, only seven are Opec members, and a few are advanced industrial

nations. This chapter delves into the complex factors that lie behind these wide-

ly differing individual circumstances and the impact that they have had on gov-

ernment sales strategies. The chapter is broken down into profiles of the 36 most

important crude oil exporting countries in the world, organized alphabetically forquick reference. Specific details are provided that go beyond the earlier discussions ofinternational spot and term-contract markets, but the descriptions have been kept brief,in part because of the wealth of further information that is available on individual crudeoils (see Chapter H).

Export data for 1995 indicate some important shifts in the relative volume

positions of the world�s crude oil exporters. Both Norway and Venezuela

advanced in the rankings, and Russia recaptured some lost ground in its exportsto countries outside of the ex-USSR. The UK and Canada also rose strongly. But theUnited Arab Emirates fell behind due to sagging Dubai field flows, and Libya slipped inthe rankings despite relatively stable exports. Saudi Arabia continues to stand head andshoulders above the rest of the field.

0 1,500 3,000 4,500 6,000 7,500 9,000

Output

Exports

TOP 10 CRUDE OIL EXPORTING COUNTRIES IN 1996

(In 1,000 b/d)

Saudi Arabia

Norway

Iran

Russia �

Venezuela

UAE

Nigeria

UK

Mexico

Canada

� Russian exports to other former Soviet Republics and elsewhere.

F2 PIW © CRUDE OIL HANDBOOK

The table below shows the crude oil exports and production in 1996 and 1995

for the 30 largest exporting nations. It provides a useful backdrop for the dis-

cussions of the individual countries that follow.

ABU DHABI

The emirate of Abu Dhabi is the largest oil producer in the United Arab Emirates

confederation, and it has one of the widest ranges of crude oil grades among

Mideast exporters. Characteristics common to all of the crudes are their medium-to-

light weight for regional oils and their relatively low sul-

fur content, at least by Mideast standards. The highest-

quality grades, onshore Murban and offshore Lower

Zakum and Umm Shaif, are especially prized among

Asian buyers because of their high yields of top-quality

middle distillates (see pH13-H26). Far East markets havebecome so reliant on Abu Dhabi crude oil that less then30,000 b/d heads elsewhere for a sustained period. Back in

1994, over 100,000 b/d consistently flowed to Mediterranean refiners. The high kerosineyields of Abu Dhabi grades are especially valuable in autumn and early winter for Japaneseand South Korean refiners, when they are building up stocks for the winter heating season.

Marketing is handled by state Abu Dhabi National Oil Co., which controls 60%

of Abu Dhabi�s crude oil production, and by a mix of foreign equity producers,

which hold the remaining 40%. Adnoc moves most barrels on either a govern-

ment-to-government or term-contract basis, while the equity companies tend to

sell more spot barrels. Major oil companies, Japanese consortium Jodco, and SouthKorean refiners dominate the purchase of Upper and Lower Zakum, Murban, and UmmShaif exports, while France�s Total shares marketing of Abu Bukhoosh with JapanIndonesia Petroleum. Besides a long list of Japanese and Korean buyers, other pur-chasers include Bangladesh, India, Thailand, Sri Lanka, Pakistan, and Taiwan. Jodco,

Exports* OutputRank Country 1996 1995 1996 1995

1 Saudi Arabia 6,520 6,550 7,975 8,0182 Norway 2,825 2,525 3,082 2,7813 Iran 2,700 2,670 3,666 3,6084 Russia � 2,425 2,420 5,985 5,9815 Venezuela 2,000 1,818 2,980 2,7106 UAE 1,950 1,965 2,201 2,1937 Nigeria 1,800 1,750 2,030 1,8768 UK 1,600 1,618 2,445 2,4179 Mexico 1,540 1,350 2,857 2,617

10 Canada 1,200 1,163 2,035 1,99211 Libya 1,125 1,115 1,400 1,39012 Kuwait 975 1000 1,820 1,85013 Indonesia 870 805 1,363 1,35814 Oman 815 785 882 85515 Algeria 660 625 809 766

Exports* OutputRank Country 1996 1995 1996 199516 Angola 650 610 679 64017 Neutral Zone 480 425 480 42518 Qatar 450 400 473 44919 Egypt 435 450 893 92320 China 375 300 3,174 2,99621 Syria 360 370 585 59822 Colombia 355 320 623 58623 Gabon 340 315 365 34124 Argentina 300 200 770 71225 Yemen 295 275 350 33526 Malaysia 250 250 655 66027 Ecuador 250 250 395 39528 Australia 200 180 551 54529 Brunei 170 170 175 17530 Congo 165 170 180 185

TOP 30 CRUDE OIL EXPORTERS, 1995-96 (In 1,000 b/d)

Note: Data for 1996 based on first 10 months. *Includes condensates for Algeria and Indonesia. � Russian exports toother former Soviet republics and elsewhere.


Kanematsu, Mobil, Exxon, Royal Dutch/Shell, and British Petroleum also market AbuDhabi grades to Japanese buyers.

Pricing for Adnoc�s term contracts is on a monthly retroactive basis, and indi-

vidual crude oil streams are loosely aligned with spot Dubai quotes from the pre-

vious month, with a premium over the Mideast benchmark grade that reflects the high-er quality of the Abu Dhabi oils. The term-contract sales of equity producers are usual-ly tied directly to the Adnoc prices, as are most spot sales.

Destinations of exports vary according to competing grades and time of year,

but Japan has come to dominate purchases. Refiners from South Korea, Taiwan, andSingapore are also active buyers. Japan�s thirst for Abu Dhabi grades has picked up withhigher runs at its relatively unsophisticated refineries in recent years and the country�sgrowing demand for light products.

ALGERIA

Unlike most other Opec oil producers, Algeria�s crude oil marketing is not the

primary source of its petroleum export revenue, but it is likely to regain some of

its past importance with growing domestic production. Algeria also exports large

volumes of oil products, condensates, liq-

uefied petroleum gas, and natural gas. In

fact, the country�s foreign sales of con-

densates and refined products, both at

about 300,000-400,000 barrels a day each,

exceed its international crude oil sales,

which typically run at 300,000-350,000

b/d and are mainly of light, sweet Saharan

Blend (see pH27-H32). The high quality ofthe crude oil and its large gasoline yield makeit popular among refiners, especially duringthe summer. The main markets lie across theMediterranean in Italy, France, and southernGermany, where it competes with Libyan,Syrian, Tunisian, and Nigerian grades. Small volumes have also found their way to SouthKorea and China in recent years. In contrast, Algerian condensate is popular in both theAmericas and Europe for gasoline and petrochemical manufacturing, with US imports forpetrochemical purposes running at over 200,000 b/d.

Despite concerns over potential political upheaval, Algeria has managed to

bring several international oil companies back in, which have been highly suc-

cessful in finding new reserves. This opening has lead to a quiet revolution in the

way Algerian crude oil will be marketed in the future. While most current crude

oil exports are still handled by state Sonatrach, Italy�s Agip began exporting

50,000 b/d of Saharan Blend on its own account in October 1995 and became the

first foreign producer to do so in over two decades. Next on line, Petro-Canada andSpanish Cepsa were scheduled to begin selling equity crude oil in mid-1996, while USindependent Anadarko expected to bring 40,000 b/d on stream by December 1996.Exports tied to Anadarko�s 1.5-billion barrel east Algerian fields could climb as high as300,000 b/d by 1998, which would push crude oil exports back up over 500,000 b/d.The addition of all this extra Saharan Blend is likely to create an active spot market in


the Mediterranean, and it could possibly emerge as a regional sweet crude oil bench-mark independent of Brent or Forties.

Algerian crude oil is sold on the basis of formulas that vary slightly among

customers but are all tied to North Sea Brent grade. Saharan Blend prices are usu-

ally at a premium of 50¢ a barrel or so above Brent. Algerian condensate sales areusually priced on the basis of refined product levels in the US Gulf Coast and Rotterdam.For both crude oil and condensate, the pricing is usually determined on a cargo-by-cargobasis even for regular term-contract customers.

ANGOLA

Angola�s roughly 650,000 barrels a day in crude oil exports are primarily shipped

to refineries in the Atlantic Basin, although the pull of Asia-Pacific markets has

grown stronger in the early 1990s. Angolan grades enjoy wide popularity

because their quality places them between conventional sweet and sour cate-

gories. Grades such as Cabinda, which encompasses over 50% of Angola�s

exports, are used for blending with higher- and lower-quality grades, makingthese grades popular for both simple and com-plex refining systems despite high wax con-tent. Since 1992, Angola has found an increas-ingly wide market in the Far East, as Cabindahas become popular there because of its highmiddle-distillate yield. The low sulfur contentof Angolan grades has also made them attrac-tive for direct burning as boiler fuel byJapanese utilities. Angola�s two other mainexport grades are Palanca and Soyo. Molongoand Takula, sometimes referred to as separatestreams, are simply terminals in the Cabindasystem (see pH33-H38).

Exports, which have risen by about

200,000 b/d since 1993 and are set to climb

further, are handled by both state Sonangol and equity producers � mainly

Chevron, Elf Aquitaine, Agip, and Texaco. The crude oils are priced exclusively

off dated Brent, with differentials fluctuating at a discount of between $1 and

$1.75 a barrel under the North Sea marker grade. Aside from barrels that stay

within the downstream systems of equity producers, much of the rest of the oil

finds its way into the spot market, through the equity producers, Sonangol, or

term customers. In fact, Angolan crude oils are some of the world�s most actively trad-ed spot barrels other than the international benchmarks and Nigerian grades. Reflectingthe popularity of Angolan crude oil and its wide spot trade, almost 15 US companiesimported it in 1995 � a list that rivals in length the lists of much larger suppliers suchas Canada, Saudi Arabia, and Venezuela. Some of the larger US buyers in 1995, whenimports totalled 365,000 b/d, include Sun, Coastal, and Phibro.

Sonangol is the single largest marketer of Angola�s crude oil, maintaining an

average term customer base of eight to 12 buyers. However, with much of the

increased production being handled by equity producers, regional diversifica-

tion in the marketing of Angolan grades is only likely to intensify. After a one-year


shutdown due to civil war, onshore operator Petrofina has begun marketing up to 30,000b/d of Soyo crude oil in 1996. Brazil�s Petrobras also buys 20,000 b/d under a barterarrangement to pay down debt. Production has managed to increase despite intermittentflashes of civil unrest tied to the last vestiges of the 21-year-old civil war.

ARGENTINA

Argentina has begun to emerge as a small but increasingly visible exporter to the

Latin American and US markets. Argentine crude oil exports to the US topped

45,000 barrels a day in 1995, although they should

begin to drop back as producers there focus on

nearby developing markets in the southern cone of

South America. Overall crude oil exports were up

over 250,000 b/d in 1995 and were expected to

exceed 300,000 b/d in 1996, as greater use of natur-

al gas within Argentina has made domestic oil

demand grow at a slower pace than new produc-

tion. Far and away its biggest customer, Brazil is pur-chasing 120,000 b/d, almost 40% of Argentina�s exports,under a series of term-contract and spot purchases. Chilebuys 100,000 b/d mostly through the newly opened100,000 b/d Transandean pipeline from the prolific Neuquen Basin to the Chilean portof Concepcion. US imports climbed slightly in 1995 to 47,000 b/d and could hit 60,000b/d in 1996, with Exxon alone purchasing half the total.

As the country�s production rises, further exports to Chile and beyond are

expected. Far East, US West Coast, and European destinations have already been

broached and could be a precursor to further diversification. Cargoes of Argentinecrude oil have found their way to Spain, Italy, Japan, South Africa, Taiwan, and Canada.The only possibility of a cut in exports could come from higher domestic refining runs,as existing capacity exceeds throughputs by almost 200,000 b/d. Grades are purchasedbased on a formula tied to either US West Texas Intermediate at Cushing, Oklahoma, orto dated Brent. Some Brazilian sales contracts are on a dated Brent formula.

The growing domestic role of private oil companies is evident in the output

and export numbers, with over 10 firms producing a total of over 725,000 b/d.

Argentina�s privatization of state YPF has created a mini drilling boom and ush-

ered in a host of new potential exporters. Argentina refines less than two-thirds

of its crude oil, and that percentage is dropping. Newly privatized YPF and Argentineconglomerate Perez Companc produce over 50% of the country�s crude oil and are thelargest exporters of Argentina�s four main export grades, Canadon Seco, Escalante,Medanito, and Rincon. All of these grades are low in sulfur, with Canadon Seco andEscalante roughly 25-gravity and Medanito and Rincon around 36-gravity (see pH39-H46).

AUSTRALIA

Australia produces roughly 560,000 barrels a day of crude oil and 60,000 b/d of

condensate, but only about 30% of this oil is exported. All sales are by equity pro-

ducers, with Exxon and domestic BHP the dominant sellers. Despite gradual pro-

duction declines since the late 1980s, the offshore Gippsland field and adjacent

Bass Straits fields remain the largest sources of domestic crude oil and account


for about 40% of total output. The high-quality Gippsland grade is sought by

refiners in Japan, the US, and Singapore, as well as in Australia itself (see pH47-H54). Due to its high light-product yield, it is among the most expensive grades on theworld market, and it is generally more costly than competing grades from Malaysia and

Indonesia. The two equity holders, Exxon and BHP, selloccasional cargoes of about 650,000 barrels each on theinternational market, mostly on a spot basis. The twocompanies are spending heavily to increase reservesthrough enhanced recovery and bringing on smallersatellite fields, which are expected to keep output near200,000 b/d into the next century.

Most of the country�s oil exports come from

expanding output from the Northwest Shelf and

Timor Sea areas, which has helped to offset the

decline of the Bass Straits fields. The Timor Sea fields � the older Challis, Jabiru, andCassini, along with Skua � produce about 65,000 b/d, mostly for export, with BHP adominant equity producer.

New fields coming are scheduled to raise Australian production to a peak of

615,000 b/d in 1996, when exports should top the 200,000 b/d mark. The

planned development of the offshore Wanaea/Cossack field on the Northwest

Shelf paid dividends in late 1995, with new production adding 130,000 b/d of

extra-light, low-sulfur crude oil to Australia�s export menu. Flows from Griffin, alsoon the Northwest Shelf, started in 1994, with an expected peak rate of almost 80,000 b/d,also providing a boost to exports. Beyond 1996, production is likely to drop steadily overthe next decade, except for one more brief uptick in 1999, when the Laminaria fieldcould add around 75,000 b/d of new output.

Condensate output has not risen as quickly as expected, although the

Northwest Shelf liquefied natural gas project has provided a stable baseload. TheGoodwyn gas/condensate field on the Northwest Shelf started up by 1995 with flows of60,000 b/d, doubling Northwest Shelf condensate output. Much of this condensate isbeing exported to markets in the Far East.

Australia is also a significant petroleum importer, averaging about 360,000

b/d of crude oil, mainly from the Mideast and Indonesia. This complements domes-tic supplies of light, sweet crude oil and condensate, which are the baseload supply toAustralia�s sophisticated, gasoline-oriented refining system.

BRUNEI

Brunei�s crude oil-marketing policy is clear and uncomplicated. Joint-venture

company Brunei Shell, owned 50/50 by the Shell group and the government,

handles all oil exports. The tiny Southeast Asian sultanate has loosened its pre-

viously strict production ceiling of 150,000 barrels a day for both crude oil and

condensates after temporarily increasing flows during the Gulf war and adding

to its reserve base. Output was about 175,000 b/d in 1995, with Japanese and SouthKorean firms the main buyers. Output peaked at over 180,000 b/d during the Gulf crisisin 1990-91. Japanese and Korean term-contract customers look to the crude oils as securebaseload supplies outside of the Mideast. Both countries also have increasing needs forlow-sulfur grades, and since slightly more than half of Brunei�s production is either light,


low-sulfur crude oil or condensate, customers are usually willing to pay a premium overother Asian supplies (see pH55-H62).

Brunei sells three grades of crude oil and one of condensate, with prices set

monthly on a retroactive basis, generally in line with top-quality Malaysian pric-

ing levels. Term sales are emphasized over spot

deals, although an increasing level of pricing and

marketing flexibility has been apparent since the

mid-1980s. Brunei Light and Seria Light Export Blendare the lighter grades, while Champion is the heavyexport crude oil. SLEB is actually just a blend of BruneiLight and Champion, and a large volume of it goes toJapan for use as boiler fuel at power plants. Nearly20,000 b/d of Brunei condensate, mainly from the sul-tanate�s liquefied natural gas plant, is sold separately. Exports account for all but about5,000 b/d of total crude oil and condensate production, with more than 80% sold on aterm-contract basis. Japan, South Korea, Singapore, and Thailand account for over 90%of all term contract purchases. Spot cargoes also sell into other neighboring countriessuch as the Philippines and Taiwan.

CAMEROON

Like most of the smaller West African producers, Cameroon relies heavily on equi-

ty partners to market its crude oil output, which was about 130,000 barrels a day

in 1995. All of the crude oil is produced by

Elf and Shell, with Kole Blend accounting

for the bulk of exports from its output of

110,000 b/d. At 32.5-gravity, Kole is relativelyheavy but low in sulfur, and as a result, saleshave broadened away from past reliance onUS Gulf Coast refiners and toward Far Eastoutlets. For those refiners that can handle it,Kole is prized for its wide middle-distillate cut.The other main grade is heavier 20-gravityLokele, which is also low in sulfur and some-times used for direct burning in power plants(see pH63-H66).

Prices for Cameroon�s exports are typ-

ically linked to dated Brent, with Kole hav-

ing increased in value in the past few years due to a worldwide shortage of heavier

low-sulfur grades. Through the first quarter of 1996, spot prices were running at

dated Brent minus 75¢ a barrel. Prices for Lokele are also higher than earlier this decade,running fairly often at around dated Brent minus $1.45. Pricing is determined on a cargo-by-cargo basis, and a significant share of exports end up in spot trade. State SNH sells mostof its share under term contracts, but these barrels are often resold into the spot market.

CANADA

The Canadian crude oil-supply system is primarily pipeline-oriented, so its oil

exports are directed almost exclusively at the big US market to the south. The


existing pipeline network has allowed crude oil producers in Western Canada to

export significant volumes to US refiners in the northern states, stretching from

the Great Lakes region to the Pacific. Canada supplied about 1-million barrels a

day of crude oil to the US market in 1995, but

serious pipeline capacity constraints on

most lines are causing diplacements of sales,

and several expansion plans are under con-

sideration. With Canadian supplies available forexport expected to rise in the years ahead andUS requirements growing, there is little doubtabout the need to expand capacity. The keyquestion is: Which regional markets in the USshould the Canadian producers focus on? Thechoices are complex, involving uncertainty overUS and Canadian regional output, imports, and demand. The 1.47-million b/dInterprovincial Pipe Line, the primary route for exports to the US, has had to frequentlydeny access to 20%-40% of requested volumes due to a lack of space. IPL is currentlyraising capacity by another 120,000 b/d after quickly using up all of a 170,000 b/d expan-sion completed in 1995. This latest addition should be completed by late 1996.

The only remaining escape valve for surplus Canadian crude oil is the 290,000

b/d TransMountain Pipeline, which services US Pacific Coast refiners in the Puget

Sound area near Seattle, Washington. These US refiners had been taking as much

as 110,000 b/d of Canadian crude oil in 1995, up sharply from the 80,000 b/d pur-

chased back in 1993. The US West Coast is clearly a last gasp option for most sellers,as relatively lower crude oil prices there make it an unattractive market for Canadian pro-ducers. However, the lifting of the ban on US Alaskan North Slope exports in 1996should help to raise prices for Canadian producers, as ANS will no longer be a captive,cheap purchase for US West Coast refiners. When Canadian prices have been extremelylow, crude oil has sometimes been exported from Vancouver to the Far East.

Crude oil-short Eastern Canada relies on a combination of pipeline supplies

from the west and imports of about 500,000 b/d from the international market.

But its import dependence should ease by 1998, when crude oil starts flowing

from Newfoundland�s Hibernia field. Hibernia is expected to plateau at 125,000 b/din 2000, followed soon after by 100,000 b/d of output from nearby Terra Nova. It is notyet clear if any of this new production will be exported (see pH67-H72).

The refiners in the US Great Lakes region are key importers of Canada�s heavy

grades, which Canadian refiners have significant difficulty absorbing them-

selves. About 500,000 b/d of heavy Canadian crude oil is imported by the US, and GreatLakes refiners Koch, Amoco, and Mobil are among the largest users. The US absorbsroughly two-thirds of Canada�s heavy crude oil output. The country�s higher-quality,light, sweet grades amount to a little over 400,000 b/d, while light, sour, and syntheticgrades provide about 100,000 b/d each of imports.

While heavy crude oil production holds the greatest potential for growth, US

imports of lighter Canadian grades should also grow when part of a key pipeline

to Eastern Canada is reversed as expected in the last half of the 1990s, allowing

refiners in Ontario to increase their reliance on cheaper international or future

Eastern Canadian supplies at the expense of light, sweet domestic crude oil.


Canada was producing over 2.1-million b/d of crude oil in 1996, and output is likely tostay at that level or even rise slightly as more pipeline outlets are built to the US. Whileexports to the US amounted to 900,000 b/d, Canada also imports about 600,000 b/d fromoverseas, with about half of that total coming from the North Sea. This includes volumesimported for third-party processing in Newfoundland, and also a trickle of 3,000 b/d orso of imports from the US.

The Canadian crude oil market is similar to the US domestic market, with a

myriad of sellers. Refiners post prices for the various grades, which are sold on aratable basis in the pipeline systems. Export prices are often quoted on a Chicago deliv-ered basis in US dollars. Most crude oil moves under term contracts, but spot trade hasgrown despite the limitations of pipeline capacity. Prices are tied to US West TexasIntermediate and West Texas Sour grades.

CHINA

Chinese oil-marketing policy reflects a complex web of pressures, which include

such factors as Beijing�s need to earn hard currency, attempts by state companies

to integrate vertically, and the central government�s fight with provincial and

municipal authorities to control the nation�s oil supply, including exports and

imports. Beijing�s campaign to maximize oil exports while limiting imports has

had mixed success: It has kept crude oil exports at about 400,000 barrels a day,

but the country is still slipping into net importer status due to surging domestic

demand and static production of just over 3-million b/d. State Sinochem, which pre-viously had its trading monopoly broken, haspartially reasserted its role in overseeing exportsin the last couple of years. Attempts to central-ize and curb products and crude oil importshave had only sporadic success, as other statecompanies have moved into new activities in thepetroleum sector. In general, crude oil is export-ed from onshore and offshore fields in northernChina, while crude oil imports are mainly torefiners in the south and near the coast.

Two grades dominate export sales:

medium-gravity Daqing and heavy Shengli,

which together account for nearly two-

thirds of total Chinese output of just over 3-

million b/d. Both are relatively high in wax content, but the heavier weight and

higher sulfur content of Shengli as compared to other Asian grades makes it

unattractive and hard to sell. Like similar Asian grades from Indonesia and

Vietnam, these grades are used both as refinery feedstock and as boiler fuel at

power plants. Daqing accounts for most exports, which are influenced by Japaneseneeds for crude oil for direct burning at power plants during peak electricity-use sea-sons, as well as by the availability of similar grades such as Indonesian Minas andVietnamese Bach Ho. Japan imports about 200,000 b/d of Daqing for refinery use andas much as another 100,000 b/d for power plant fuel. Lower-quality Shengli is generallyused more in domestic refining, and Japan takes about 25,000 b/d (see pH73-H76).

Growing sales from offshore fields are handled by foreign partners for state


CNOOC and move to Singapore, the US West Coast, or Japan. Shell and Phillips

are two of the newest marketers of Chinese crude oil, selling roughly 100,000 b/d

of low-sulfur, waxy Xiiang along with partner CNOOC since November 1995.

Sales have been made to Indonesia, Hawaii, and Singapore so far. In general, Japan isChina�s primary customer, taking some 300,000 b/d in 1995. US refiners still take around50,000 b/d, with the US West Coast operations of Chevron and Tosco the dominant buy-ers. Smaller volumes of up to 40,000 b/d are bought by South Korean refiners.

Pricing systems vary for Chinese exports, but contracts are all tied in some

way to the official price of Indonesian Minas grade or spot Oman and Dubai.

Japan�s 180,000 b/d government-to-government deal with China is priced on a

retroactive monthly basis, tied loosely to the average Minas quote. Buyers try totake advantage of the price lags of Minas � which is set on a complicated five-graderolling average linked to the Asian Petroleum Price Index � by increasing purchaseswhen prices are low. But Sinochem attempts to push more volume across to Tokyo andbuy cheaper replacement barrels for refineries in southern China when prices are high.Spot sales are increasingly rare, but they also use Minas as a benchmark.

COLOMBIA

Of the world�s major crude oil exporters, Colombia�s position is changing more

dynamically than most of its rivals. While still the third-largest crude oil exporter

in South America and far behind front-runners Venezuela and Mexico, several new

grades including Cusiana and Cupiagua should make

Colombia a major force in crude oil markets in the

coming years. Although export volumes of its Cano

Limon grade are relatively small at 240,000 barrels a

day, the grade can be an influential trendsetter in US

markets because it is a popular spot barrel for sweet

and sour crude oil refiners alike and is heavily traded

on the US Gulf Coast. Similar in quality to US AlaskanNorth Slope grade, it is a medium-to-heavy 30-gravity oil

with a relatively low 0.5% sulfur content. Plans for developing the Cusiana field and itssatellites call for marketing the new 36-gravity, 0.25% sulfur crude oil as a separate stream.Through early 1996, Cusiana production was up to nearly 200,000 b/d, with exports over100,000 b/d. Total Colombian crude oil exports are expected to rise from close to 400,000b/d at present to over 600,000 b/d by 1998 (see pH77-H82).

While volatile because of sporadic guerrilla attacks on the main export pipeline,

Colombia�s crude oil production runs in the neighborhood of 630,000 b/d, with

output expected to rise to more than 900,000 b/d by 1998. Several new pipeline

projects are under way to increase export capacity. Plans include a new and improved$2.5-billion crude oil export pipeline system. In addition to other expansions, the so-calledOcensa pipeline consortium � which groups Cusiana partners BP, Total, Triton Energy,and Ecopetrol with Canadian pipeline firms IPL and TransCanada � is counting on run-ning the pipeline at 85% of its 500,000 b/d capacity on average. Crude oil shipments to theCovenas export terminal are often disrupted by attacks on the existing 225,000 b/d CanoLimon and 75,000 b/d Llanos Central pipelines. Monthly production has dropped as lowas 300,000 b/d at times, and cargoes have often been rolled over into future months, whichis why many US refiners shy away from committing to term contracts.


Colombia�s four main crude oil producers are state Ecopetrol, British

Petroleum, Shell, and Occidental. Cano Limon exports are divided among three

producing companies, with Ecopetrol selling 50% and Shell and Occidental divid-

ing the rest. Cusiana exports are divided among equity producers Ecopetrol

(50%), BP (19%), Total (19%), and Triton Energy (12%). Ecopetrol offers its shareon a term-contract basis in most cases. The Cano Limon contracts last from three to sixmonths and are awarded on an open-tender basis with linkage to West TexasIntermediate. Cusiana term contracts have been signed with Tosco and Fina for 1996,with several more deals expected as output continues to rise toward 500,000 b/d by theend of 1997. From the Covenas loading terminal in the Caribbean, term buyers lift oneor two 75,000-deadweight-ton cargoes per month, which is the preferred size for deliv-ery to the US Gulf Coast. Shell also exports 45,000 b/d of heavier Vasconia grade, whichis a 25-gravity, 0.8% sulfur grade.

Cano Limon�s ambiguous status in the middle ground between sweet and sour

grades makes its pricing a confusing affair. Term and spot buyers take cargoes

on a formula basis tied to any one or a combination of US marker grades �

Alaskan North Slope, West Texas Intermediate, and West Texas Sour. Cusiana, a

low-sulfur, sweet grade, is priced versus WTI and has traded anywhere between

20¢ and 75¢ a barrel under the US benchmark. Equity producers BP, Total, andTriton Energy were selling their cumulative 45,000 b/d on a spot basis in 1996. Shell andOccidental sell most of each of their three monthly cargoes of Cano Limon on a spotbasis on the US Gulf Coast. Meanwhile, Ecopetrol normally juggles four to six term cus-tomers at any one time.

CONGO

Congo�s current exports of about 180,000 barrels a day are handled mainly by Elf

Aquitaine and Agip, which are the equity producers of Djeno crude oil, the coun-

try�s primary export grade. Elf holds 60% and Agip 40% of the 175,000 b/d Djeno

crude oil stream, which is relatively

heavy, at 27-gravity, but low in sulfur like

other West African oils. As for other, small-er West African producers, the US Gulf Coasthas traditionally been a primary outlet forCongo�s Djeno grade, but the interest of Asiancustomers in heavy, sweet grades has pulledvolumes in that direction in recent years. Thepricing of Djeno is tied to dated Brent, andthe grade appears regularly in spot trade.Djeno is usually priced at a discount of about$2-$3 a barrel off dated Brent, but the gap hassometimes been as wide as $5-$6. Recent US buyers include Exxon, Amerada Hess, andPhibro, with Italy�s Agip and Spain�s Repsol also occasional buyers. Yombo, Congo�sother main crude oil stream, is a sweet but heavy 20-gravity grade produced by Amoco,Kuwait�s Kufpec, and state Hydro Congo. Most of this grade is sold directly into the USEast Coast electric utility market, where it is used as a substitute for residual fuel oil.

Even though production from the Djeno field is in decline, a sizable boost in

exports is expected over the next few years, as Chevron and operator Elf bring


the 130,000 b/d N�Kossa project on stream at an initial rate of 90,000 b/d in mid-

1996. Overall Congo production peaked at 215,000 b/d in 1994 and has been decliningever since. The inclusion of N�Kossa output should help output steadily rise to 250,000b/d by 1998. Further successes with Elf�s sizable offshore exploration program could verywell send production even higher (see pH83-H86).

DUBAI

The emirate of Dubai is a distant second among producers in the United Arab

Emirates after Abu Dhabi. But despite its small and declining output of about

275,000 barrels a day in 1996, it holds a disproportionately important role in

Mideast pricing and world oil trade. Its spot market serves as the pricing bench-

mark for the entire region, affecting either directly or indirectly most spot and

term-contract crude oil transactions in the Gulf (see pH87-H90). Because it is pro-duced by a handful of Western oil companieswith little direct role by the state, the Arab Light-quality grade has developed into a leading spotmarket crude oil that casts a long shadow onworld markets, despite its limited production. Anumber of international equity producers, led byUS Conoco and French Total, market most of thegrade, with the vast majority of cargoes usuallymoving through the forward market into spottransactions. The ruler plays a passive role thathas been instrumental in allowing the market to develop. The government�s physicalshare of production is usually resold on a spot or term basis to international oil compa-nies. (Dubai�s extensive benchmark role is dealt with in detail beginning on pB19).

The Dubai forward market went through a confidence crisis in 1993 that

reduced trading in the second half of the year and caused operator Conoco to

revise the general terms and conditions of its trading contract. However, with

the emergence of swaps trade to complement forward markets, trade figures

are back up and can run as high as 2-million b/d in paper transactions. During

quieter periods, as little as 200,000 b/d can change hands. Declining productionand the heavy dependence of the forward market on spread trading against Brent havecalled into question the durability of Dubai as a marker grade. However, with fewalternatives available and a general reluctance by Mideast producers to encouragedirect spot trading, Dubai could well endure as the key regional benchmark gradedespite its limitations.

Currently, US traders Phibro and Morgan Stanley are the largest players in

the Dubai market, which is also dominated by equity producers Conoco,

Repsol, and British Petroleum. However, since Conoco tightened up the nomi-

nations procedures, trade has been bustling with new players and some old

ones that are only now reemerging. Trades of full 500,000 barrel cargoes and par-tial cargoes as small as 50,000 barrels are actively exchanged in forward and swapsmarkets. Elf, Koch, Vitol, Kanematsu, and Itochu have been joined by Glencore,Arcadia, and Coastal in returning Dubai crude oil trade to the center of prominence inMideast and Asian markets. Statoil and other Atlantic Basin producers also use theDubai market to hedge sales to the Asia-Pacific region.


Dubai looks both east and west, with trading activity and pricing closely

linked to Atlantic Basin markets and UK Brent crude oil trading, while most of

the oil is shipped to Japan, India, Singapore, and South Africa. Japan alone

imports about 25%, or some 75,000 b/d. Volumes only occasionally move west whenarbitrage opportunities are strong, and this is often through the internal downstream sys-tem of one of the equity producers. In 1995, Koch imported one cargo of Dubai and wasthe only US refiner to do so. Dubai also exports about 25,000 b/d of MarghamCondensate, which heads exclusively to Asian markets.

ECUADOR

Ecuador�s upward of 250,000 barrels a day of sour crude oil exports have been

marketed primarily on the US Gulf Coast by a slew of trading companies, with

Quito-based Tripetrol and Glencore the most prominent among them. Ecuador�s

benchmark grade Oriente acts as a key price indicator for US sour crude oil mar-

kets. Some oil is also sold to East Asia, mainly to refiners in South Korea, with the

US West Coast and Brazil serving as secondary outlets as well. Volumes have been

growing, and the country�s decision to leave Opec

back in 1993 only enhanced its ability to push

ahead its full-throttle export strategy. Oriente gradeis Ecuador�s main export grade, and it is becoming pro-gressively heavier as new streams are added to the base-load output of the mature Shushufindi field (see pH91).Exports have increased from 180,000 b/d in the early1990s to almost 250,000 b/d at present as a result of newproduction and lower domestic refinery runs. Orientegrade is exported from the Balao terminal in 50,000 ton ships, the maximum size that canpass through the Panama Canal. It is similar in quality to US Alaskan North Slope, and itis sold on an f.o.b. basis. Once it is waterborne, the grade is actively traded, despiteEcuadoran laws that prohibit the sale of crude oil to traders, which are honored more intheir breach than in their observance. All shipments to the primary market on the US GulfCoast move through the Panama Canal.

All Oriente crude oil is sold initially by Petroecuador, and it is priced off spot

market quotes of US West Texas Intermediate, with a freight ceiling built in to

make the grade attractive to buyers on the US Gulf Coast. Oriente was the last for-mula priced crude oil to abandon Alaskan North Slope as a market grade in early 1996.Tenders for term contracts are awarded on a yearly basis, usually in increments of 12,000b/d, but they can be as much as twice that level. Petroecuador would like to contract allof its crude oil on a term basis, but it has been forced to sell on the spot market duringpricing spats with some of its larger customers.

Petroecuador�s biggest problem has been the high concentration of its sales

among a relatively small number of customers. Traders such as Tripetrol and

Glencore continue to maintain a stranglehold on the Oriente term-contract mar-

ket through a variety of subsidiaries and shell companies such as Tevier, Oil Tex,

Anglo Energy, and others. However, South Korean buyers Yukong and Lucky Goldstarhave managed to break the grip somewhat and now make up one-sixth of all contractholders, with over 50,000 b/d of volume. Customers also include former equity produc-er Texaco, Argentine trader Interpetrol, and US Tosco. Petroecuador has occasionally


pursued crude oil-processing deals in the US, Venezuela, and Puerto Rico, but so far ithas only been able to strike up intermittent deals with Venezuela�s Corpoven.

EGYPT

Egypt�s roughly 350,000-400,000 barrels a day of crude oil exports are generally

made up of benchmark Suez Blend and a handful of smaller-volume, heavier

grades, including Belayim, Ras Budran, and Ras Gharib. However, much of this oil

is handled by equity producers that sell only about 175,000 b/d to third parties out-

side of their own systems. State Egyptian General Petroleum Corp. markets anoth-

er 170,000 b/d of crude oil under term contracts. Besides EGPC, US Amoco is thecountry�s biggest crude oil exporter, marketing just over100,000 b/d, primarily in the Mediterranean. Some of theseSuez Blend cargoes appear on the spot market. Italy�s Agipis the next biggest seller among equity producers at some75,000 b/d, or about four cargoes a month from its 230,000b/d Belayim field. Beginning in 1996, the grade is going tobe jointly marketed by Agip and state EGPC on the

Mediterranean spot market, since the Italian firm found it difficult to market the grade atposted prices set by the state. Shell, British Petroleum, German Deminex, and US Phillipsall produce equity crude oil, but they usually do not market it to third parties. Egyptiangrades are high in sulfur and range from 34-gravity Suez Blend to much heavier oils.

After numerous customer complaints, EGPC has simplified its unusually com-

plex crude oil-pricing formula system for its term-contract sales to a simple link

with dated Brent. From 1992 through 1995, Egypt had used a basket of three bench-mark grades: UK Brent, Iran Heavy, and spot quotes for Suez Blend. These three gradeswere used to determine a value for Suez Blend, which accounts for 80% of Egypt�s950,000 b/d of crude oil production, with other grades priced off it. However, lack ofliquidity in the spot market for Iran Heavy and Suez Blend forced EGPC to drop theseelements, which accounted for 40% of the overall formula (see pH93-H102).

On the marketing front, EGPC�s former 45,000 b/d term contract with Israel,

which was its largest, has been reduced to less than half this amount in 1996,

with Israel opting to play the market now that other Arab producers have

dropped their �second degree� boycott. EGPC has a score of other, smaller con-

tracts, primarily with traders and European refiners. Along with Israel, Egypt�smain customers continue to be Mobil and Star Enterprise in the US, along with two ofSouth Africa�s four main refineries. Sales to the US are on the rise, with over 50,000 b/dexpected in 1996, up from just over 30,000 b/d in 1995. New production of heavy gradesZaafarana, Gharib, and Geisum is popular among sophisticated refiners in the US.

Egypt�s most important asset is not necessarily its crude oil, but probably its

location, which makes it a key intermediary between Mideast producers and

Western markets. The Sumed pipeline from Ain Sukhna on the Red Sea to Sidi

Kerir on the Mediterranean regularly carries 1.6- to 1.8-million b/d of Mideast

crude oil into Europe, while volumes through the Suez Canal, which are limited

to fully laden 150,000 deadweight ton ships, average 1.2-million b/d. Other thanEgypt itself, the chief clients of Sumed are Saudi Arabia, Iran, Kuwait, and some of theircustomers. Sumed and the Suez Canal save 10 days of travel time to Europe, and SidiKerir is used in the market as an f.o.b. sales point for Saudi and Iranian grades. The


Sumed pipeline has been expanded, with the ability to carry up to 2.34-million b/d, butit has operated at just under 2-million b/d.

GABON

Gabon�s roughly 340,000 barrels a day of crude oil exports are dominated by

Royal Dutch/Shell and Elf Aquitaine, which have substantial equity production

that has been steadily increasing since 1987. Its rising flows prompted it to fol-

low Ecuador in leaving Opec in 1996. Gabon exports three main types of crude

oil: Rabi Export Blend, Rabi Light, and Mandji. Rabi production � from a con-

glomeration of mid-gravity, low-sulfur producing fields � has reached its plateau

output level of some 200,000 b/d, and it will probably stay there well into the

next century (see pH103-H108). Rabi is sold in two forms. The first, Rabi Export Blend,is a combination of Rabi and Gamba crude oil,which makes up a 100,000 b/d export streamsold by Royal Dutch/Shell. Gamba was origi-nally sold separately, but it was incorporatedinto Rabi when the latter, a much largerstream, began production in 1989. Elf markets100,000 b/d of the second type, Rabi Light,which is not blended with Gamba and is there-fore slightly higher in quality. The 90,000 b/doffshore Mandji crude oil is Gabon�s main sourgrade, and it is marketed by Elf as a slightlyhigher-quality equivalent to US Alaskan NorthSlope. Three other grades, Lucina, M�Baya, andOguendjo make up the balance of exports.Shell sells one 350,000 barrel cargo a month ofLucina, which is Gabon�s lightest-gravity, low-sulfur export oil. M�Baya and Oguendjo areboth sold in single cargoes on a quarterly basis by producers Elf and Kelt Energy.

In the 1990s, Gabon has established a wider market for its grades. Although

they were once just Atlantic Basin grades, Mandji and Rabi have gained wide-

spread acceptance in Far East markets. Japanese utilities have found Rabi to be an

excellent substitute for medium and heavy Indonesian grades that are used in

direct burning under boilers. Japanese imports of Gabonese grades ran as high as40,000 b/d in 1993, but they have since tailed off due to competition from new Australianlight sweet grades. South Korean, Singapore, and Chinese refiners have also dabbled withspot cargoes. Gabonese grades are sold almost exclusively on a spot basis, with pricesrelated to dated Brent and sometimes Alaskan North Slope or West Texas Intermediatewhen they are headed toward the US. While Europe was once Gabon�s key market, saleshave been growing to US buyers, which are now a primary destination. US imports havetripled since 1991 to around 250,000 b/d in 1995. Key buyers include British Petroleum,Tosco, Coastal, and Phibro. In Europe, Elf still lifts 30,000-40,000 b/d of equity produc-tion, with Portugal being the next largest buyer at less than 10,000 b/d in 1995.

INDONESIA

Indonesia�s oil export-sales system is among the least transparent in East Asia

because it is divided up among state Pertamina, its marketing affiliates, and a score


of international companies with equity production. It also involves a score of dif-

ferent grades, although its main Minas and Duri fields account for the bulk of

international sales. With domestic demand cutting into exports, marketing opera-

tions are being consolidated, but they remain complex. State Pertamina and its

affiliates only handle about 45% of total exports of about 800,000 barrels a day,

with the foreign partners moving the rest. The state firm forms the nucleus of the sys-tem, with its unusual term-contract pricing mechanism used as the basis for almost all

export sales and for the division of costs andprofits in the upstream production-sharingdeals that account for most of the output. Theexport activities of the international equityproducers vary considerably, with somekeeping almost all of the oil in their own sys-tems and others selling most of their crude oilto third parties. One feature of the Indonesianexport market is the relatively small volume

of spot transactions in any single grade. This is partly due to the fragmentation of exportsales volumes and the preference of most parties for term contracts (see pH109-H128).

Indonesia exports about 55% of its crude oil and condensate production of

around 1.5-million b/d. State Pertamina has fought off the spectre of declining

exports by increasing imports from Iran, Saudi Arabia, and sometimes Libya to

meet annual domestic demand growth of 6%-8%. While Japanese sales are less

than they were five years ago, Tokyo remains Indonesia�s largest customer, tak-

ing 600,000 b/d. Other customers include South Korea, China, the US, Australia,

Taiwan, and Singapore. With sales to Japan shrinking, Pertamina merged its two affil-iates, Japan-Indonesia Oil Co. and Far East Oil Trading Co., into Pacific Petroleum andTrading Company in late 1995. PPTC is half-owned by Pertamina, with the rest held byvarious Japanese refiners, including Nippon Oil, Idemitsu, Cosmo, and several electric,steel, and gas companies. PPTC holds a formal contract for roughly 100,000 b/d of directsales to Japanese refiners and power utilities. However, the volume of sales handled bythe company often exceeds contract levels, which are regarded as baseload supply byJapanese refiners.

Pertamina has three other crude oil marketing affiliates � Indoil, Perta Oil,

and Korean Indonesian Petroleum. Another marketing associate, Permindo,

which is owned by Pertamina and a private local group, controls the bulk of

Indonesia�s products trade. It also handles third-party processing deals for Pertamina.Hong Kong-based Perta Oil is responsible for estimated crude oil sales of 60,000-65,000b/d, mainly to China.

Among equity producers, the largest volume firms are also the largest

exporters. Caltex leads the way with its Minas and Duri grades, followed by

Mobil, Maxus, Total, and Arco. Minas crude oil alone accounts for about 30% of

all Indonesian oil exports � by far the largest stream. Mobil markets 30,000 b/d ofthe 90,000 b/d Arun condensate production, but most of its entitlements go to its affili-ates, with occasional cargoes being sold to third parties on the spot market. By contrast,Maxus, the producer of Widuri � which, at about 100,000 b/d, is one of the larger exportgrades � sells all of its share of output to third parties, mainly in Japan.

Indonesia�s crude oil pricing system is a unique mixture of formula and


retroactive assessments. Prices are set monthly on the basis of the previous

month�s spot assessments for a basket of five crude oils made by the Asian

Petroleum Price Index. Average differentials for the previous 52 weeks are

applied to determine the final prices, with special adjustments for harder-to-mar-

ket grades. While the system is complex and mechanical, it is clearly defined, like aprice formula. At times, it has encountered serious problems when the crude oil differ-entials have failed to reflect current market values, which has happened in periods ofseasonal or extreme market weakness. Despite some complaints from market partici-pants, Pertamina seems unlikely to modify the system in any significant way.

IRAN

Unlike producers such as Saudi Arabia and Mexico, which rely on long-term rela-

tionships forged through standard term contracts, Iran�s large export sales of

some 2.6- to 2.8-million barrels a day depend much more heavily on fluctuating

strategies that are continuously adjusted to match changing circumstances. The

constant threat of further US sanctions has made these strategies all the more

useful in 1996. State National Iranian Oil Co., which is the country�s exclusive

seller despite past efforts by some interests in Tehran to set up alternative chan-

nels, uses perhaps the widest array of marketing techniques of any oil exporter.

The imposition of harsher US sanctions on Iran in early 1995 forced a 400,000 b/d shiftin Iran�s customer base, as large US buyers such asExxon, Coastal, Mobil, and Caltex were no longerallowed to buy Iranian crude oil, even for their over-seas refineries. For a time, much of this volume wassold on a spot basis along with the standard 300,000b/d or so of spot availability, but significant amountsare now bought under contract by Mediterraneanrefiners. Iran�s incremental supply role has caused it tolose some popularity among its customers when NIOC is too stiff in its pricing demands.However, the firm almost always manages to sell its available crude oil regardless of mar-ket conditions and competition from other Opec producing nations or Russia, even if itsometimes must put several cargoes to sea unsold (see pH129-H138).

In recent years, Iran has used a wide range of marketing techniques. It has

made varying use of traders as marketing intermediaries, while also relying on

barter, prefinancing deals, crude oil-for-product swaps, sales from storage, spot

deals, delivered sales in Europe and the Mediterranean, and a host of other alter-

natives to traditional f.o.b. term contracts. At one time, traders were heavily reliedupon to market spot barrels on a delivered basis in Northwest Europe, until NIOCassumed this role itself. Intermediaries sometimes perform a similar role in theMediterranean, and they also provide products in return for crude oil. In general, NIOCtends to cut back on its use of middlemen when they start to undermine its sales in alocal market, but the firm relies on them as a way to move marginal barrels up until thatpoint. Traders also play a role in markets that are not easily accessible or where buyershave credit problems, such as India and Eastern Europe. NIOC has its own trading ven-ture called Nafta-Iran Intertrade, which markets some spot barrels in Europe.

The more traditional term contracts that Iran maintains are kept up annually

with Asian customers, mainly in Japan and South Korea. Current sales to Asia


run in the 900,000 b/d to 1.1-million b/d range, spread out among nine countries.

Prices are under the standard monthly formula terms with fairly predictable vol-

umes. The only wrinkle in Iran�s Asian pricing is the linkage of Iran Light grade exclu-sively to Oman as a benchmark and Iran Heavy to Dubai. This is a variation on the typ-ical Saudi preference for an average of the two. Traders are sometimes used to augmentthese Far East sales volumes.

European and South African sales, which make up most of the rest of Iranian

exports, are the other extreme, with heavy competition from Russian spot sales

in the Mediterranean forcing NIOC to remain constantly innovative in its sales

strategy. About 55%-65% of Iran�s exports go to Europe and South Africa at for-

mula prices linked to spot North Sea Brent levels, whether the oil is sold from its

main loading terminal at Kharg Island, sold in the Mediterranean, or delivered

into Rotterdam. However, these proportions can fluctuate wildly when marketing

opportunities unveil themselves in higher-priced regions. Pricing is mostly handledon a cargo-by-cargo basis with substantial variation among buyers. NIOC shifts back andforth over time between various sales points in Rotterdam, the Mediterranean, or theMideast Gulf, depending on market circumstances. Tanker chartering by state NITC canoffer a glimpse of directional changes in flows between eastern and western markets.Many Western buyers consider their purchases to be spot rather than term no matter howregular and stable their volumes are. South Africa has emerged as Iran�s largest buyer, lift-ing over 200,000 b/d, followed by Greece, British Petroleum, Italy�s Isab, RoyalDutch/Shell, and Turkey. Some refiners, particularly in the Mediterranean region, hold�frame� contracts that loosely define volumes to be lifted each quarter, but not the price.

US sales remain suspended, and NIOC�s marketing efforts have been compli-

cated by the tight US government restrictions that prevent any US refiner from

utilizing Iranian crude oil anywhere in the world. A full-scale revival of sales intothe US depends on a further easing of restrictions by Washington, which is unlikely tooccur anytime soon, as politicians in both major US parties firmly support the sanctions.

Iran�s exports vary significantly from month to month and among grades,

depending both on marketing pressures and its own internal needs. Iran Lightexports range from 35%-45% of the total, while Iran Heavy accounts for 45%-50% and off-shore grades 12%-18%, or about 450,000 b/d. Virtually all offshore output is exported.

IRAQ

Before invading Kuwait in August 1990, Iraq had overtaken Iran as Opec�s second-

largest crude oil exporter, with overseas sales of almost 3-million barrels a day in

the first half of that year. But the United Nations embargo since then excluded Iraq

from world markets until December 1996 and has left Baghdad at the mercy of UN

Security Council decisions about its export status. In 1996, the first signs emerged

of a limited return of Iraq to world oil markets under the auspices of a humanitar-

ian aid program, with these efforts coming to fruition at the end of the year. Exportsof 550,000 b/d of crude oil were expected to resume in early 1997 from both the Turkishexport pipeline to Ceyhan on the Mediterranean and from the Iraqi terminal of Mina Al-Bakr on the Gulf. Iraq has long been considered an expert marketer, with large and effec-tive pre-war sales of its three grades worldwide � 37-gravity Kirkuk, produced in thenorth, and 35-gravity Basra and 27-gravity Fao Blend, produced in the south (see pH139-H144). Through its state marketing arm Somo, Iraq previously sold its crude oil at formu-


la prices that were highly competitive with prevailing Saudi, Iranian, and Kuwaiti terms,often varying significantly between individual customers in the same geographical region.A similar approach is being used under the UN oil sales program, in which the proceedsfrom the oil sales are to be used to buy food and medicine for the people of Iraq.

Prior to the UN oil-for-aid program, Iraq�s only sanctioned crude oil exports

went to Jordan under a special UN exception to the embargo. The 40,000-60,000b/d has been sold under concessionary price terms and was supplemented by refinedproduct exports of about 20,000 b/d. Turkey and Iran have been receiving oil as well,with volumes varying between 25,000 b/d and 75,000 b/d, despite a lack of UN approval.

With the humanitarian oil sales program, Iraq has

reestablished relations with numerous customers, both

old and new. It has targeted sales in all three main mar-

kets to a wide range of buyers. Iraq firmly believes that theoil-for-aid program is a first step toward a full lifting of sanc-tions and that it needs to position itself in world crude oil mar-kets for further large increases in sales. Buyers are also con-cerned about possible changes in the quality of Iraqi oil dur-ing the long hiatus, during which excess fuel oil was reinjected into some of the fields.Small term contracts are thus likely to be the focus of the 550,000 b/d of new UN-approved sales.

KUWAIT

Term-contract sales are the backbone of Kuwait�s crude oil marketing policy. Fully

recovered from its traumatic destruction at the hands of the Iraqi military in 1990,

state Kuwait Petroleum Corp. is selling as much crude oil now � a total of almost

1-million barrels a day � to third-party buyers as it did before the war. Kuwait�s

single export grade tends to be difficult to market because it is relatively heavy

and sour, which prompted a strategy of diversifying into refined product exports

and overseas downstream investments, mainly in Europe. Growing domestic

refinery capacity has eaten into available crude oil export volumes in 1995-96 (seepH145). KPC handles all of the country�s crude oil sales and has sought out new term-

contract customers in Latin America, Africa, and Asia,sometimes displacing other Mideast suppliers with morerigid terms. In the US, for example, Kuwait has commit-ted itself to delivered sales in the US market, which putsit on an equal footing with short-haul supplies. But theUS and other Atlantic Basin destinations have borne thebrunt of the reductions in crude oil export volumes

caused by the rise in domestic refinery capacity to a planned 875,000 b/d by 1997. In Asia, Kuwait has improved the quality of its exports by spiking kerosine

into export cargoes in order to boost the light-product yield of the oil.

Concentrated marketing efforts in the Far East had boosted sales to Asia to

550,000 b/d, a volume that is likely to increase as several new refining projects

come on stream. Japanese refiners are the largest buyers of Kuwaiti crude oil, lifting upto 175,000 b/d under term contracts. The marketing of exports from its 50% share ofNeutral Zone crude oil production is handled mainly by the equity producers there andmainly ends up in Asia (see separate section on Neutral Zone, pF23). South Korea,


Taiwan, India, and the Philippines are also large buyers. Volumes to India and SouthKorea are likely to expand the fastest, with several grassroots refineries being built ineach country. KPC also processes some of its own crude oil in Singapore, and it refinesas much as 800,000 b/d in its own domestic plants, which are primarily export-oriented.

KPC sells its crude oil in all major markets worldwide, usually pricing its 31-

gravity Kuwait grade under formula terms at a slight discount to or in line with

similar-quality Arab Medium crude oil in all of these markets. Total crude oil exportsthrough mid-1996 were 1.3-million b/d, including its share of the Neutral Zone. Less than100,000 b/d was destined for its own refineries in Europe, which rely heavily on North Seagrades. The largest customers for Kuwait�s crude oil exports are major oil companies suchas Exxon, Shell, Chevron, and Indian Oil Corp. Brazil�s Petrobras suspended its 50,000 b/dcontract due to price disagreements in late 1995, and the crude oil has been transferred toSouth African buyers, which lifted almost 100,000 b/d in 1996. Like Saudi Arabia, Kuwaithas tended to shy away from marketing heavily in Europe due to intense competition fromIran and Russia. Nevertheless, KPC manages to sell a nearly equal amount of crude oil inthe US and Europe. Other US buyers include Ashland, Marathon, and Fina.

LIBYA

Libya�s international political isolation has led it to pursue a policy of locking in

customers for as much of its roughly 1.1-million barrels a day in crude oil exports

as possible. Adding to the already troublesome financial sanctions imposed by the

United Nations, more stringent US government sanctions have been added in 1996,

including a ban on the sale of certain oil equipment and considerably broader uni-

lateral US restrictions. However, Tripoli has been able to maintain a business-as-

usual attitude, and traditional European customers appear willing to stick with the

oil, despite regular complaints about stiff price terms. Libya�s tightly controlled andunwavering marketing strategy reflects a desire to tie all crude oil sales into deeper com-

mercial relationships with customers linked toinvestment or barter. Libya�s close ties to thecontinental European market are a direct resultof Tripoli�s strained relationship with the US,UK, and France. The US has maintained a stiffembargo on Libyan exports since 1985, and theUK and France have supported the 1993 and1996 tightening of trade and financial sanctionsby the UN and US, respectively, which affect-ed oil sales indirectly by forcing Libya to usebanks based in third-world countries.

Almost all of Libya�s term-contract cus-

tomers already have a �special� relation-

ship of some sort with Tripoli. About 80%

of exports are handled through these

contracts, with the remainder taken by European equity producers as their share

of production. Through Geneva-based Oilinvest � which is controlled, although notmajority-owned, by Tripoli � Libya has direct interests in refineries in Italy, Germany,and Switzerland that give it an outlet for 300,000 b/d of crude oil exports, including someresales. Government-to-government deals with Turkey, Greece, South Korea, and Spain


are tied to more complex economic packages involving an element of barter. The nextlargest group of crude oil purchasers are equity producers Agip, OMV, and Veba, whichbuy term-contract supplies on top of their equity volumes. The heavy dependence ofItaly, Switzerland, Germany, and Austria on Libyan crude oil and the investments in thesecountries are designed to shield Libya�s oil revenue from international political pressure.

Libyan crude oil is no longer prominent in the Mediterranean spot market,

where light, sweet Es Sider grade was once considered an important benchmark.

Libya sets the prices for its term-contract sales under typical formula terms tiedto the dated Brent market, with all sales on an f.o.b. basis. Other than Es Sider, Libyaoffers six other export grades ranging from 36- to 41-gravity (see pH147-H160). Asidefrom its heavy European sales orientation, some of its heavier waxy grades sometimesmove to Asian markets when the arbitrage is attractive.

MALAYSIA

State Petronas takes the lead role in the country�s crude oil export trade, with

main equity producers Shell and Exxon playing a support role that involves ship-

ments of their own equity supplies mainly within their refining systems. With

production of crude oil and condensate steady at about 650,000 barrels a day, a

little over half was exported in 1995,

mainly to customers in Asia. Exports of thecountry�s benchmark Tapis grade are slightlydown since 1994 due to higher domesticrefinery runs associated with the opening of arefinery refinery at Melaka. Petronas is gener-ally entitled to at least one-half of all crude oiloutput, while equity-producing companiestake the rest. The five crude oil export blends,in order of importance, are Tapis, Labuan,Miri, Bintulu, and Dulang. Output of high-quality Tapis is about 350,000 b/d, whileLabuan and Miri hover around 100,000 b/d each (see pH161-H170).

Petronas moves its exports through three different channels. Term contracts

with several regional customers amounted to about 250,000 b/d in 1995, with

occasional processing arrangements in Singapore and Yemen totaling about

40,000 b/d and another 50,000 b/d or so reaching the international spot market

through regular auctions. Petronas usually tenders one or two cargoes of Tapis andone each of Labuan and Dulang every month, amounting to about 2-million barrels inall. Tapis, noted for its yield of top-grade gasoline and middle distillates, is one of Asia�smost popular spot grades, but exported volumes are likely to shrink as domestic refin-ing grows. This downward trend means it is unlikely that Tapis will achieve full-fledgedmarker status. Heavier Labuan makes a good grade of middle distillates and is usuallypriced a few cents a barrel lower than Tapis. Dulang is a similar light, sweet, but waxycrude oil that is priced closer to Indonesian Minas grade.

Petronas has a well-diversified slate of term-contract sales � mainly to Japan,

South Korea, Taiwan, and India � that accounts for most of its offtake. A new

1996 link with South African refiner Engen is likely to increase shipments there.

The Petronas sales are made based on monthly average assessments of Tapis

crude oil. Petronas used to apply retroactive monthly prices, which were set with ref-


erence to regional spot market levels. But the system was changed twice in 1995, withPetronas settling on direct linkage to monthly average assessments from Platt�s and theAsia Petroleum Price Index plus an adjustment factor. Customers had complained thatthe previous formula did not accurately reflect market prices.

MEXICO

Mexico�s state oil company, Pemex, has faced a perpetual conflict between satis-

fying domestic demand, which has grown rapidly, and maintaining crude oil

exports, which generate a large share of Mexico�s foreign exchange. Sustained

efforts to increase crude oil production and curb domestic demand through high-

er product prices and increased utilization of gas have helped boost Mexican crude

oil exports to over 1.5-million barrels a day. By emphasizing term relationships

and competitive pricing, Mexico has been

able to increase crude oil exports by over

200,000 b/d in the past few years. PMI, Pe-mex�s international marketing arm, offers threeexport grades: Isthmus (33-gravity, 1.5% sulfur),Maya (22-gravity, 3.3% sulfur), and Olmeca (39-gravity, 0.77% sulfur). Available volumes ofeach grade fluctuate due to seasonal variationsin domestic refiner needs, but Pemex has gen-erally shifted its export slate in favor of lighter,sweeter grades. In late 1993, volumes wereaveraging 250,000 b/d for Isthmus, 800,000 b/d

for Maya, and 230,000 b/d for Olmeca. By first-half 1996, Olmeca sales had jumped to460,000 b/d, while Isthmus and Maya exports were holding fairly steady. New light fieldsin the Bay of Campeche have been boosting Olmeca (see pH171-H176).

Some 75% of Mexico�s 1.5-million b/d in crude oil exports are sold to a wide

range of US refiners on a term-contract basis. Shell and Mobil are by far the

largest buyers, lifting over 200,000 b/d each, with Chevron and Exxon next at

125,000 b/d each. Spanish refiner Repsol, in which Pemex owns a 5% stake, is

also a large buyer at 150,000 b/d, while other European firms take much smaller

volumes. In the US, a Pemex joint refining venture with US Shell at its Deer Park,

Texas, plant has locked in 110,000 b/d. Shell, on its own account, lifts at least

another 125,000 b/d for its US refineries. Many US Gulf Coast and Midwest buyersregard Mexico as a key baseload source of crude oil supply, much like Saudi Arabia. Inthe past, Pemex put a strict limit of 50% of exports on sales to the US, but now, with amore market-oriented strategy in place, PMI�s customer list includes a full range of over20 major and large independent US refiners. Mexico is also responsible for one-half ofthe crude oil supplied along with Venezuela under the San Jose Accord, which serveslesser-developed Latin American and Caribbean countries. These volumes vary widely.Japan has a long-term, government-to-government contract for a mix of Isthmus andMaya that has been scaled back to 75,000 b/d.

Mexico�s customers are steady and have tended to change little over the years,

although with increased exports of Olmeca, more sweet crude oil refiners have

signed up. Term contracts are valued particularly on the US Gulf Coast because

Mexico is a short-haul, secure supplier that is willing to adjust volumes with great


flexibility on a month-to-month basis. However, buyers of Mexican oil also face the

most complex crude oil-pricing formula system in the world. Current formulasinclude differentials to weighted combinations of US West Texas Sour, Alaskan NorthSlope, and Light Louisiana Sweet, Oman, Dubai, dated UK Brent, and various grades ofresidual fuel oil. PMI also sometimes makes single spot deals that it calls �trial� cargoes inorder to satisfy official Mexican restrictions against spot sales or resales by term customers.

NEUTRAL ZONE

The Neutral Zone is controlled jointly by Saudi Arabia and Kuwait, each adminis-

tering part of it and dividing revenue equally from the oil, which is produced

under traditional Mideast concession contracts. This shared sovereignty has pre-

vented the kind of nationalizations that were common throughout the Mideast oil

industry in the 1970s. As a result, the Neutral Zone consists of two completely sep-

arate production and marketing entities that are united only by the similar nature

of the grades that they export. Virtually all of the Neutral Zone�s output of 480,000

barrels a day is exported. Production in the western zone, which is almost all onshore,is the responsibility of Texaco�s affiliate Getty and state Kuwait OilCo., while the eastern area, exclusively offshore, is managed byJapan�s Arabian Oil Co., with 10% shares in each operating com-pany held by the governments of Kuwait and Saudi Arabia. Crudeoil types are all relatively heavy and sour: Onshore Wafra at 22-to 24-gravity is among the heaviest grades in the region, and it isbeing joined by even heavier 18-gravity Eocene flows in 1997, which are expected toreach 50,000-60,000 b/d. Offshore Khafji is similar in quality to Arab Heavy, and offshoreHout ranks somewhere between Arab Light and Medium (see pH177-H182).

Most of the sales for these grades are under term contracts, which are vital to

smooth marketing due to the smaller volumes and poor quality of the oil.

Arabian Oil Co. markets the offshore output, taking much of it back to refiners

in Japan, while the onshore production has been kept within the downstream

systems of the equity producers or sold mainly to Japanese customers. Formula

pricing dominates AOC sales, with tight linkage to Saudi terms. About 50% of the270,000 b/d offshore Khafji production is sold into Japan, with the rest going to otherAsian buyers. Most of the 30,000 b/d Hout flow is taken by Japan National Oil Co. forthe country�s strategic oil stockpile. Since the AOC concession is Japan�s largest sourceof equity crude oil, making it a prized and secure source of supply for Tokyo, the mar-keting of this oil in Japan is usually relatively easy and uncompetitive. In particular, theJNOC purchases of Hout help the grade to overcome its relatively unattractive Arab Light-linked prices. The AOC output alone accounts for half of Japanese overseas equity crudeoil production. Meanwhile, pricing of Texaco�s 220,000 b/d Wafra crude oil productionis less transparent, and marketing had become more difficult due to unrepaired damageto the onshore Mina Saud refinery during the Iraqi invasion.

Long-term considerations are likely to affect the future development and mar-

keting of Neutral Zone grades. Texaco has been disappointed with its efforts to

find deeper light crude oil deposits, and the firm has proposed steamflooding and

other heavy-crude oil production measures. AOC is committed to a large offshore

investment and development program. Both of these new sources of supply

depend on renewal of the existing concessions. AOC�s concession expires in 1999,


and Texaco�s in 2009. While Kuwait has expressed a willingness to extend the currentaccord with AOC, the Saudi position has been clouded by its previously planned down-stream investment program in Japan, which was called off in late 1993. AOC�s decision tobegin the long-term investment program, which includes new investment and replace-ment of the aging infrastructure, is a sign that the concession is likely to be renewed.

NIGERIA

Nigerian grades are widely considered to be among the most desirable export

grades available in the Atlantic Basin. Their high yields of both gasoline and gas

oil make them popular in both the summer and winter and offer refiners the max-

imum in operational flexibility. The country�s 1.7- to 1.8-million barrels a day of

crude oil and condensate exports have a major impact on the North Sea market

and its benchmark Brent grade, and they

represent one of the most actively traded

international spot markets, after the North

Sea�s. Crude oil sales are handled both by

state Nigerian National Petroleum Corp.

and by its international equity producing

partner companies. Nigeria�s 2-million b/dof production is divided on a roughly 60-40basis between majority share owner NNPC andits main equity partners � Royal Dutch/Shell,Texaco, Chevron, Mobil, Phillips, Agip,Ashland, and Elf Aquitaine. In addition to their750,000-800,000 b/d equity shares, the interna-tional oil companies also receive extra volumesfrom NNPC as payment for the state firm�s

share of joint-venture operations and investments. As a result, total volumes exported bythe equity producers are about 900,000 b/d, most of which goes into their own down-stream refining systems. NNPC consumes about 200,000-300,000 b/d in its domesticrefineries and exports about 800,000 to 1-million b/d under term contracts as well as addi-tional volumes for overseas processing to cover Nigeria�s domestic product deficit.

Nigeria�s exports go mainly to the US Gulf and East coasts as well as to Spain,

France, Germany, and other European buyers. Some small volumes flow East of

Suez, but these are largely incremental sales that are a function of arbitrage

opportunities. The so-called BBQ grades � Bonny Light, Brass River, and Qua Iboe �are in especially high demand during the summer due to their exceptionally high gaso-line yields, while Forcados is considered one of the best gas oil-producing grades in theworld. By extension, Bonny Light and Qua Iboe are sometimes referred to as the BQgrades because they are priced at parity (see pH183-H194).

Virtually all Nigerian crude oil sales, whether on a spot or term basis, are

priced at a differential to dated Brent, even on sales to the US. The term-contract

price conditions are adjusted by NNPC on the third week of the current month

for the following calendar month. NNPC�s term customers vary somewhat arbi-

trarily depending on the whims of government policy, with traders and

European firms holding most of the contracts under the awards made in late

1995. However, this customer list is the world�s most fluid and can change more


than once a year. The past use of term-contract awards as a way to lure investment intoNigeria has been largely unsuccessful. A system of commission fees and commercialagents also clouds relationships between NNPC and its customers. Pricing is generallyquite competitive, although buyers are quick to cut back liftings if the oil is consideredtoo expensive and the potential for resale is deemed unprofitable. At times NNPC hasresorted to special discounts, such as the use of netback pricing on Forcados grade inlate 1992, in order to maintain offtake. However, Nigeria is not a big user of alternativemarketing techniques to maintain volumes, and its price terms generally apply uniform-ly to all term customers. NNPC�s use of Brent-based term-contract pricing into the US isunusual among exporting countries, but it seems to work well because of the close linksbetween Nigerian crude oil trading and the North Sea Brent market.

The abundance of traders holding term contracts and the large volume of

exports in the hands of equity producers guarantee an active physical spot mar-

ket. However, any trading firms interested in joining the fray should be warned

that there�s no market with a greater number of sophisticated traders. Some of thebusiness�s more clever spot traders such as Glencore, Vitol, and Addax tend to be themost prominent players, with Morgan Stanley also taking a substantial role. Forcados andBonny Light are the country�s most heavily traded spot grades, with Nigerian spot trad-ing usually following the lead of the UK Brent market. As far as end-users go, AmeradaHess, BP America, and Sun tend to be the largest lifters in the US, while Repsol, ElfAquitaine, and Total carry the brunt of European purchases. India, Pakistan, and SouthAfrica have cumulatively begun lifting 200,000-300,000 b/d in recent years.

NORWAY

Norway is the quiet sister of North Sea crude oil marketing, but it has expanded

its output steadily and now ranks as Europe�s largest oil producer and crude oil

exporter, and as the second-largest crude oil exporter in the world. While UK

Brent gets tossed around from trader to trader in a constant effort to determine

its absolute price, Norwegian grades move along more quietly, trading at a differ-ential to dated Brent. The volumes of the Norwegian crude oil streams are large and oftenoutpace UK crude oil markets, but the Norwegian grades havegrown up in the shadow of the highly visible and active UKtrade, and as a result, they are rarely in the spotlight despitetheir now-large volumes. Through early 1996, Norwegian crudeoil production had swelled to over 3-million barrels a day, withthe addition of 260,000 b/d from the Heidrun and Troll fields.More increases are expected in the late 1990s.

Some 30 companies produce crude oil in Norway,

which flows into 10 main grades � Ekofisk, Statfjord,

Gullfaks, Gullfaks C, Oseberg, Brent, Forties, Draugen, Heidrun, and Yme. The four

main grades � Ekofisk, Statfjord, Oseberg, and Gullfaks � are high-quality, light,

sweet oils, though high acidity levels in new Heidrun grade have made refinery

upgrades mandatory for some of its customers (see pH195-H210). The two largest equi-ty producers are Statoil and Norsk Hydro, with Statoil also handling the government�s largedirect stake in some of the fields. Other significant producers include Royal Dutch/Shell,Phillips, Saga, Petrofina, Mobil, Exxon, Elf Aquitaine, and British Petroleum. Roughly half ofNorway�s oil output is loaded directly at the production platforms, while the balance is


loaded at terminals in Sture and Mongstad, Norway, and Teesside, UK. The table belowgives a idea of which Norwegian fields are used in making the country�s 10 export blends.

About half of Norway�s production is kept within the refining systems of the

equity producers in Europe and the US, with the remainder sold to third parties,

usually on a spot basis. New grades Troll and Heidrun are being marketed through termcontracts, though due to the competitive, spot orientation of North Sea trading, only partof Norway�s output is sold on a term-contract basis. Even so, Statoil has successfully builtup new long-term outlets both in Europe and North America. Norway has about 270,000b/d of domestic refining capacity, and the country relies almost entirely on its own out-put. Small volumes are imported from nearby Danish and UK fields, with occasional vol-umes also coming from Russia. Like the UK producers, Norway announces loading pro-grams each month, which provide the basis for extensive spot and forward trading.

Norway�s largest outlet is the UK refining sector, which alone absorbs about

600,000 barrels a day, or 20% of Norway�s crude oil, followed by the Netherlands

and Germany, which each take about half that volume. The US market has grownfrom less than 50,000 b/d in 1990 to over 250,000 b/d in 1995, with shipments to Canadaalso approaching 200,000 b/d in 1995. Norwegian marketing in North America has beenfacilitated by the use of long-term storage in the Bahamas. Statoil is also targeting Asiaand has begun to sign up some term customers there, including a 20,000 b/d deal withCPC Taiwan.

OMAN

Rising production and shifting preferences of Asian refiners have made the mar-

keting of Oman�s crude oil more challenging in the 1990s, but the level of spot

trade has not increased noticeably as a result, and it may even have declined.

Help from trader Transworld Oil and equity producer Royal Dutch/Shell as well

as overseas refining ventures have provided new outlets, as have growing term

sales to rapidly expanding Asian markets in South Korea and elsewhere. AlthoughOman blend is slightly lower in sulfur than typical Saudi and Iranian grades, it does nothave the appeal of the higher-quality Abu Dhabi and Qatar grades for Asian refiners (seepH211). While Japanese sales volumes have remained fairly stable, a broadening of themarketing base was needed as output has climbed to 870,000 barrels a day, and otherbuyers have indeed been found. South Korean refiners have increased their purchases

NORWAY�S CRUDE STREAMS 1995 OutputCrude Blends Contributing Fields Shipment Point (1,000 b/d)Ekofisk Ekofisk, Embla, Gyda, Hod, Tommeliten, Valhall, Ula Terminal, Teesside, UK 481Statfjord Blend Statfjord, Snorre, Statfjord East, Statfjord North Buoy via Mongstad, Norway 790Oseberg Blend Oseberg, Veslefrikk, Brage, Frøy, Lille-Frigg Terminal, Sture, Norway 695Gullfaks Blend Gullfaks A, Gullfaks B, Gullfaks West Buoy via Mongstad, Norway

582*Gullfaks C Gullfaks C, Tordis Bouy via Mongstad, NorwayBrent Blend Murchison Terminal, Sullom Voe, UK 3Forties Heimdal, Condensate Terminal, Cruden Bay 8

& Hounds Point, UKDraugen Draugen Buoy 99Heidrun Heidrun Buoy via Mongstad, Norway 118 �

Yme Yme Buoy via Mongstad, Norway 33 �

*Gullfaks Blend and Gullfaks C averaged 582,000 b/d in 1995.

}


in recent years. Shell has become a regular third-party term lifter in addition to its siz-able equity volumes, some of which are resold under term contracts. Trader TransworldOil has played a key marketing role as a leading term customer in the past, but its roleas a reseller seems to be diminishing. Other firms, such as Finland�s Neste, also play asimilar role in resales of term barrels.

The vast majority of Omani barrels, both from equity producers and state

Petroleum Development Oman, continue to go to a growing number of cus-

tomers in Asia. PDO�s term-contract volumes werein the area of 375,000 b/d in early 1995. Other thanlarge purchases by Japanese and South Korean buy-ers, the balance of sales is spread among the emerg-ing markets of Asia. Omani barrels also move intoHawaii and the US West Coast at a rate of 25,000-50,000 b/d, with Chevron, BHP, and Tosco the mostconsistent buyers.

Oman crude oil trading provides the most

active spot market in the region after Dubai,

and as a result, it is used as a reference level for most term-contract price for-

mulas for Mideast grades. However, trading is limited in scope and closely linked

to Dubai. The forward market that had been emerging in Omani crude oil in the late1980s has dried up, and activity is focused almost completely on physical wet barrels, asinterest from Wall Street firms and Japanese trading houses has ebbed. As with AbuDhabi grades, virtually all spot trade is done on the basis of a differential to monthlyretroactive prices set by the government and usually referred to as Oman MPM (Ministryof Petroleum and Minerals).

Pricing of term supplies is more complex than it appears, and it has, at times,

created some confusion in the market. Prices are set retroactively after the end

of the month, but since all spot trade is based on the MPM price, the Dubai mar-

ket provides an outside reference point. Other inputs include Abu Dhabi spot

prices and regional refinery yields. Confusion and risk for buyers and sellers some-times comes in the setting of the MPM price, which usually fluctuates between 15¢ and85¢ a barrel relative to Dubai and depends on the methodology used by price-reportingservices. This uncertainty and ambiguity about the MPM price not only has an impact onthe spot market for Oman crude oil, which trades at a differential to it, but also influ-ences all of the formula prices in the region. Some companies have argued for a simplerpricing mechanism, particularly for Western destinations, but Oman has declinedbecause of an aversion to seeing its crude oil used as a spot benchmark.

PAPUA NEW GUINEA

Papua New Guinea started selling its high-quality light, sweet Kutubu crude oil on

the world market in mid-1992, and output averaged about 140,000 barrels a day

in 1993. But by 1995, production had stabilized at about 100,000 b/d. Operator

Chevron has outlined ambitious plans to stem the declines in Kutubu and push

output back over 115,000 b/d in 1996 and expects to add another 52,000 b/d of pro-duction from the Gobe field by 1998 (see pH213). But these increases will mainly offsetan expected fall-off in the original Kutubu field. The government markets its share ofKutubu production independently, as do the two leading equity producers, Chevron and


British Petroleum. Other, smaller equity producershave formed a consortium to handle their barrels.

Refiners in Australia and China are the main

customers, taking about 30% each. South

Korea, Taiwan, other Asian countries, and the

US also take some barrels. Kutubu crude oil isparticularly prized for its high naphtha yield andgood gasoline-manufacturing properties. Most sup-

plies are sold on the basis of term contracts. These deals are linked to spot quotes forMalaysian Tapis grade from the Asian Petroleum Price Index for the three weeks aroundthe date of loading, with a discount. However, a significant share is also retraded on thespot market.

QATAR

Qatar has had problems in the 1990s managing its upstream operations and

launching its liquefied natural gas export projects, but its crude oil marketing

has operated relatively smoothly. Qatari grades are light and sweet by Mideast

standards � similar to those of Abu Dhabi � which has made them especially

popular with Japanese and South Korean refiners. In Japan, particularly, the

emphasis on making light products from expanding but relatively unsophisti-

cated refineries has enhanced Qatari grade�s value. Qatar produces two types ofcrude oil, Qatar Marine and Qatar Land or Dukhan, averaging a total of 450,000 barrelsa day in 1995 (see pH215-H218). The country also cur-rently produces about 45,000 b/d of condensate, mostlyfor export, a volume that is likely to grow in the futurewith the associated development of its LNG operations inthe next five years. In 1995, Mitsubishi, Itochu, Marubeni,Idemitsu, and Mitsui locked up 205,000 b/d of Qatar�s345,000 b/d of crude oil contracts by signing up for30,000-50,000 b/d each, and Japanese refiners Cosmo and Nippon grabbed another30,000 b/d between them. Mobil was the only major international oil company with aterm contract, which makes sense given its heavy involvement in Qatar�s two aspiringLNG projects, Qatargas and Ras Laffan.

The withdrawal of a Shell-led group of foreign firms managing the country�s

onshore and offshore upstream oil operations and their subsequent replacement

under a 1994 management contract with Occidental did not affect Qatar�s pricing

system or crude oil exports. Term-contract prices are set retroactively every month bystate Qatar General Petroleum Corp. through a formula that is linked to Oman�s MPMposting. Price levels usually track the values of similar Abu Dhabi grades closely. As wellas providing technical assistance to QGPC in upstream developments for five years,Occidental also landed a production-sharing deal to enhance the recovery of the offshoreIdd El Shargi field.

RUSSIA

Perhaps no other country has a crude oil-marketing policy as erratic, unpre-

dictable, bureaucratic, and disjointed as that of Russia. Oil sales were previously

the paragon of central control under the Soviet authorities. The transition to a


market economy has been neither smooth nor easy for the country�s oil industry.

The most stark symptoms of this lie in Russia�s staggering output slide of 5-mil-

lion barrels a day, or nearly 50%, since the late-1980s peak, to just under 6-million

b/d in early 1996. Despite the plunge, Russia is still an important force on inter-

national markets, exporting over 1.8-million b/d of crude oil in 1995 outside the

Commonwealth Of Independent States, mostly to Europe. The wide range in exportlevels makes the Russian Urals market one of the roughest in the world in which to trade.On top of the bureaucratic hassles, Russia�s oilports are among the oil world�s most weather-sensitive facilities. Seaborne exports can go from1-million b/d one day to almost nothing the nextand back to 1-million b/d a few days later. Thelarge number of exporters also tends to createloading delays. Under the old centralized system,all oil exports were firmly in the hands ofSoyuznefteexport, which provided fairly stablequality and supplies to its regular customers on a delivered basis. However, operationaland logistical disruptions were common even then, especially in the winter, due in partto the system�s lack of flexibility and the long distances from the oil fields.

Urals grade, the standard Russian export blend, is compiled from a wide range

of fields, but it is broadly similar to Arab Light or Medium at 32-gravity and about

1%-2% sulfur. While quality was always erratic for operational reasons, variabil-

ity has become even wider with the breakup of the Soviet Union, the loss of

export terminals, and the decline in production. A new 35-gravity, low-sulfur

export grade, Siberian Light, has stabilized at volumes of around 90,000 b/d from

the Black Sea port of Tuapse. Exxon and various Mediterranean refiners have

emerged as the principal buyers. Nevertheless, the lack of flexibility of the

Russian refining and transport system may mean wide variations in quality for

some time to come (see pH219-H222). Availabilities also fluctuate seasonally, withexport declines often occurring during the winter due to logistical problems and domes-tic needs that are severely exacerbated by bureaucratic delays. Problems with access toports in the Baltic Sea and Ukraine have tended to increase reliance on the Russian BlackSea port of Novorossiysk, with a capacity of about 750,000 b/d. This has made exportseven more vulnerable to operational problems such as storms. Smaller ports in Odessa(200,000 b/d) and Tuapse (250,000 b/d) can also be utilized on the Black Sea. The Balticport of Ventspils, Latvia (290,000 b/d), is also used. The Friendship, or Druzhba, pipelinedelivers up to 1-million b/d of crude oil throughout Eastern Europe.

The bureaucracy of Russian crude oil exports has become increasingly com-

plex with the ongoing struggle among various central authorities trying to main-

tain a degree of control and the efforts of individual enterprises and regions to

manage their own exports. Sales have become more fragmented, and spot deals

predominate. Exporter classifications and approximate volumes can be broken

down into five main categories: state-controlled trading companies (330,000

b/d); state-run vertically integrated companies (1.2-million b/d); non-state oil

producers (140,000 b/d; and a variety of joint venture arrangements (250,000

b/d). While the state is still the largest seller, its volumes are handled by a plethora ofagents including trader Nafta-Moscow, the descendant of the former state monopoly sell-


er Soyuznefteexport. As many as 10 to 30 other sellers are also active, depending onpolitical and bureaucratic circumstances, with integrated firm Lukoil the most dominantplayer in the market through early 1996. The state also auctions off export volumes toqualified companies. Some groups, such as foreign joint ventures and oil-productionassociations, have clear rights to export crude oil. But an obstacle course of quotas,licenses, and permits must be run in order to sell these volumes, and sporadic changesin regulations sometimes cause disruptions to exports.

A host of constantly changing intermediary trading companies has also

grown up parallel to this wider list of official exporters. As a result, Urals is prob-

ably one of the most heavily traded grades on the international spot market after

Brent. This contrasts with the old Soviet system that relied mainly on sales to largeWestern European refiners such as Italian Agip, Finnish Neste, Spanish Repsol, andGerman Veba, as well as to majors such as Royal Dutch/Shell and a few intermediaries.These same refiners still buy large volumes of Russian crude oil, but the path from fieldto refinery is less direct. Exxon has also emerged as one of the largest buyers of Russiancrude oil following Washington�s ban on purchases of Iranian crude oil by US compa-nies even for their non-US operations.

Russian exports are priced on a spot basis linked directly to North Sea Brent,

but the differential is volatile and depends heavily on the degree of competition

with other sour crude oil producers, especially in the Mediterranean, which has

become the primary spot market arena for Urals. Prices in recent years have fluc-tuated from a 30¢ a barrel premium to dated Brent to a $1 a barrel discount. This wideranging price differential has emerged based on the interplay between spot availabilitiesof Russian and Iranian crude oil, the two grades that have come to dominate theMediterranean market. Changes in Russian or Iranian supplies also tend to set off a chainreaction of price changes in other markets, particularly the Atlantic Basin. With its spotavailability plentiful, there has been some discussion of using Urals as a new benchmarkgrade for heavier, sour grades. Russian authorities are believed to support this idea, asdo some of the East European nations that rely heavily on Russian oil. Forward tradingof pipeline supplies occurs in the Druzhba system, and a cargo-based market is also apossibility. However, at a minimum, greater predictability of both government regula-tions, supplies, and quality are probably needed for a liquid market to emerge that couldsupport both forward trading and independent benchmark status.

SAUDI ARABIA

Adamant that it would never again revert to the role of swing producer for Opec,

Saudi Arabia introduced a new pricing system in October 1987: geographically

targeted formula pricing, which was designed to protect and expand its market

position. This system has become the basis for the now-widespread use of spot

crude oil market-linked pricing of term-contract supplies. The kingdom simulta-

neously renounced the use of its crude oil as an international marker. Riyadh has

since fine-tuned its formulas to guarantee a wider clientele and steady offtake

even during times of market weakness. A primary Saudi objective has been to com-pete successfully with short-haul suppliers in distant Atlantic Basin markets. The Saudishave used two chief strategies to achieve this goal: delivered crude oil sales, mainly forsmaller regional refiners in Europe and the US; and delayed pricing and guaranteedfreight costs for purchases from the kingdom�s ports, which are mainly by major oil com-


panies for Western shipments. US prices are based on a differential to the spot price ofUS West Texas Intermediate at Cushing, Oklahoma, while sales to Europe and LatinAmerica are tied to dated Brent. All buyers for Asia-Pacific destinations have formulasbased on a monthly average of Dubai and Oman benchmark prices. These systems effec-tively protect buyers from the transportation and time risks that are normally associatedwith long voyages and put Saudi Arabia on an equal footing with competitors.

Using these attractive formula-pricing mechanisms, prices can be geared to

meet competitors head-on in each geographical market center for all five of the

kingdom�s primary export grades. In order to help bolster revenue, state Saudi

Aramco has shifted sales in favor of lighter grades since 1994, tightening price

terms and trimming sales volumes of its heavier grades. Arab Light is the mainexport crude oil and, like heavier Arab Mediumand Heavy, it is relatively high in sulfur and lightonly by Mideast standards. Although not the mostattractive grades, their large volumes make themkey baseload supplies for refiners in all of themain global refining centers � a status that ismatched by few other grades. Saudi Arabia alsoexports two lighter grades, Berri and Super Light,which are similar in quality to the more attractiveAbu Dhabi grades. Exports of 200,000 barrels aday of the new Super Light Saudi grade, which is low in sulfur and comparable to a NorthAfrican crude oil, began in 1995, with the customer list dominated by Asian buyers. SaudiAramco affiliate Ssangyong has contracted half the volume, with other customers pickingup the balance in part to ensure access to heavier grades (see pH223-H232).

Although Saudi pricing is uniform for all similar types of buyers in the same

region, this system still provides for a great deal of variation because of the wide

range of markets in which Saudi Arabia is active and its ability to sell large vol-

umes on a delivered basis in the US and Europe. For example, delivered sales canoccur from Caribbean or Rotterdam storage terminals; from the Sumed pipeline�sMediterranean outlet at Sidi Kerir, Egypt; or by ship delivered into the US Gulf Coast.The buyers are notified of price differentials almost a month in advance � earlier thanby most other producers � in order to provide them the time to work out all of the com-plex loading and sales alternatives. This early notification also allows competing suppli-ers such as Mexico and Venezuela to adjust their prices accordingly. Saudi delivered salesalso require a large volume of working storage in the Caribbean and Europe and dozensof tankers. Atlantic Basin sales are handled primarily by Saudi Petroleum International,an Aramco affiliate based in New York and London, while Asian sales are handledthrough Saudi Aramco headquarters in Dhahran.

Saudi sales to the US, Japan, and other key markets expanded sharply in the

early 1990s, doubling in some cases. Despite the return of Kuwait to the interna-

tional market and growing competition from Venezuela, Mexico, and Iran, the

erosion of the Saudi sales position has only been noticeable in the US. Less Saudi

emphasis has been placed on Europe, in part because of tougher competition

from Iranian and Russian spot sales. Sales to the major international oil companies� Royal Dutch/Shell, Exxon, Chevron, Texaco, British Petroleum, and Mobil � repre-sent slightly over 40% of the kingdom�s crude oil exports and are purchased mainly from


Saudi ports rather than on a delivered basis. These firms are also sold extra volumes ona spot basis at times, and they provide much of the flexibility in the Saudi sales program.Other clients span a wide variety of firms all over the world, with almost all refiners ofany significance taking some Saudi crude oil. Sales of Riyadh�s 50% share of crude fromthe Neutral Zone are handled by equity producers there (see separate section on NeutralZone, pF23).

Joint ventures with foreign refiners are still viewed as a future cornerstone of

Saudi marketing policy, but they currently account for only about 12% of exports

and are coming under greater scrutiny. Under the leadership of oil minister Ali

Naimi, the question of whether Saudi funds would be better spent in the devel-

opment of the domestic gas sector as a means of freeing up more oil for export

has become a key area of debate. Otherwise, the Saudis are at various stages of

negotiation over refinery ventures in China, India, and Italy. Current joint venturesfall far short of the kingdom�s 50% long-term target for refining its own exports. But ifSaudi refined product exports of 750,000 b/d are included, the share jumps to 24% ofexports, which is within reach of its interim goal of 30%. Besides its Star Enterprise part-nership with Texaco in the US � the kingdom�s largest single customer at 550,000 b/d� Saudi Aramco owns 35% of Ssangyong Refining Co. in South Korea, 40% of Petron inthe Philippines, and 50% of 100,000 b/d Greek refiner Motor Oil Hellas. These deals pro-vide outlets for about 900,000 barrels a day of crude oil.

SYRIA

Syria emerged in the 1990s as an increasingly important source of supply to the

Mediterranean market, but with its output of light, sour crude oil starting to decline

and flows of its heavier grade now stable, its importance seems to have peaked.

Syrian Light crude oil trades particularly actively in regional spot markets, with

cargoes regularly resold by about 15 to 20 term-contract lifters. About 350,000 bar-

rels a day of Syria�s output of nearly 600,000 b/d was exported in 1995. Export vol-

umes were roughly 75,000 b/d of Souedieh and 275,000 b/d of Syrian Light, with

all volumes marketed by state Syrian Petroleum Co.�s

Sytrol unit (see pH237-H240). Souedieh is produced by thestate firm at a rate of about 150,000 b/d. Syrian Light comesfrom a group of fields involving Shell, Deminex, Elf, and oth-ers, and output there had risen to 400,000 b/d in 1994 beforebeginning a gradual decline that is expected to average about10,000 b/d each year. The equity producers are not allowed to

export their crude oil, and they must sell it to the government. The country�s 220,000 b/dof refining capacity is operated at full throttle, almost entirely with domestic grades.

To cope with the highly competitive sour crude oil market in the

Mediterranean in the 1990s that was created by heavy spot trading of Russian

Urals grade, SPC diversified its sales to a wider group of 15 to 20 term customers

with flexible volumes. Its grades go mainly to European refiners, with some sales

to the US that have been threatened by sanctions. Traders such as Marc Rich, BayOil, and Marimpex are regular buyers, as are US Conoco, Austrian OMV, and severalItalian and French refiners. Prices are linked to North Sea Brent crude oil under formu-la terms. Syrian Light competes actively with Mideast sour grades and North Africangrades, but poor-quality Souedieh is sold mainly to technically sophisticated refiners,


sometimes at steep discounts to Brent. Syrian Light has declined in quality slightly since1994 as older production has been replaced by flows from newer fields.

UNITED KINGDOM

The British North Sea is the spot market capital of the world, and it seems likely

to continue in this role for a long time to come. Although Norway has now

eclipsed the UK as the largest producer in Europe, the rapid growth of British

North Sea output in the late 1970s and early 1980s, when spot markets were ris-

ing to the fore, provided a natural focus for trading and price discovery. While

the Brent Blend crude oil stream is the fulcrum of crude oil trading, the key inter-

national market grade comprises only about one-third of total UK production.

Brent Blend is a compilation of crude oil from over 15 fields that is merged into a sin-gle 675,000 barrel a day stream at the Sullom Voe loading terminal in the ShetlandIslands. Other important export streams are Forties, which is nowlarger than Brent at about 1-million b/d, and Flotta, which is indecline at about 250,000 b/d (see pH241-H250). All three of thesemain grades are loaded from terminals, which facilitates trading.Except for Flotta, all of the UK grades are light and sweet, whichgenerally makes them attractive to refiners and relatively easy tomarket. There are about a dozen smaller, offshore-loaded fields,with collective output of about 500,000 b/d. These tend to be more cumbersome becauseof logistical constraints, confining them to Europe. However, Brent and Forties are bothregularly sold outside of Europe. Due to its rising flows, Forties is expected to eventual-ly displace Brent in the key benchmark role (for a complete discussion of the Brent mar-ket and its benchmark role, see pB9).

More than half of the crude oil produced in the UK North Sea avoids the inter-

nal downstream supply systems of producing companies and is traded on a spot

basis in the international market. Over the years, freedom from regulation, the

efficiency of the market, and the ready availability of forward trading instru-

ments have reinforced the preference for spot trade in the UK North Sea. The gov-ernment gave up its active role in the market in 1985, and it has allowed trade to evolveand grow without much interference, despite some sporadic bouts of market difficulties,especially in Brent trade. The UK North Sea also represents the largest and most diverseconcentration of international oil companies in the world, with over 50 producing firmsactive in almost 75 fields.

The main players in the UK North Sea spot market are the big producers �

Shell, Exxon, and British Petroleum � and some of the large Wall Street firms

and European refiners. The sizable equity production of BP (425,000 b/d), Shell, andExxon (300,000 b/d each) gives them a distinct comparative advantage in trading. Theyare also capable of optimizing their tax exposure by opting to trade barrels or keep themin their own systems, which has an important impact on market liquidity. Enterprise andAmerada Hess have emerged as more important players with their rising Forties flows ofover 150,000 b/d each.

Along with Norwegian grades, UK crude oils are the mainstay of Northwest

Europe�s refineries. However, the UK refining sector has a high level of sophisti-

cation, so the large predominance there of sweet grades such as Brent is not ideal

for the country�s own refining sector. Therefore, of the 2.5-million barrels a day


produced in the UK, only about 800,000 b/d is refined in the nation, which has acapacity of 1.85-million b/d. Sharp increases in North Sea production in mid-1990s man-aged to push even more UK grades into a wider variety of markets. UK grades havefound more buyers in North America, the Mediterranean, and sometimes even in the FarEast, where they are coveted for their ability to produce middle distillates.

UNITED STATES

Although the US exports little crude oil, its position as a major producer and mar-

ket center gives it significant international importance. The country�s position as

an exporter expanded in 1996 when the ban on international sales of Alaskan

North Slope was lifted. The US crude oil market is unique due to its huge size,

wide dispersion of small producers, unusually heavy reliance on pipelines, and

expanding appetite for imports. Primarily because of the market�s size, bench-

mark grade West Texas Intermediate and other key US grades have broad inter-

national influence (see pH251-H260). Since the US is the world�s largest oil importerand its crude oils compete head-to-head with international grades, price trends there play

an important role in the global oil market.Although exports are limited, an understandingof how the US market works is critical to a com-plete view of the global crude oil trade. US oilpolicy can also have a huge impact on interna-tional markets, with the latest examples beingthe sanctions that the US has imposed on Iranand Libya. Policy moves such as the decontrolof US crude oil prices from 1978-81 have alsohad a significant international impact.

Although the ban has been lifted on US

exports of ANS crude oil, total volumes

seem unlikely to exceed 200,000 barrels a

day to customers in the Asia-Pacific region. Initial sales in 1996 were on a spot andterm-contract basis to Taiwan, Japan, and South Korea at a rate of 100,000 b/d. Small vol-umes of crude oil from Cook Inlet, Alaska, and California have also been exported toAsia in the past, and a limited amount into Canada, but these were all exceptions to theoverall US ban on crude oil exports. Declining production on Alaska�s North Slope andsteady demand for the crude oil on the US West Coast limit the scope for ANS exports.The previous benchmark role of ANS for trading on the Gulf Coast has been eliminatedin the mid-1990s by declining production and the shift to Asian exports.

Most US crude oils are sold under monthly �evergreen,� or automatically

renewable, contracts at prices posted by the refiners, which can change daily in

a volatile market. The myriad of small producers in the country are price-takers

and, in some cases, are highly dependent on one or two gathering companies to

get their oil into the main pipeline systems. They typically sell the crude oil at

the wellhead. This contrasts with the spot markets for US grades, which are usuallylocated at key pipeline centers such as Cushing, Oklahoma. Deliveries there occur on aspot or �cash� basis and against the New York Mercantile Exchange�s light, sweet crudeoil futures contract, which in practice focuses almost exclusively on WTI. Local produc-ers, refiners, and trucking companies that gather oil from the wellhead in remote areas


are important players in the term market, and traders also get involved sometimes. Oilpriced at the wellhead does find its way into a specialized spot market called the �Pplus,� or �postings plus,� market. US refiners that need more domestic crude oil can usethese markets to acquire lease oil on a ratable basis at prices linked to the monthly aver-age �posted� contract quote for one or several refiners whose posted prices are consid-ered most reflective of spot market trends.

US pipeline supplies are also traded actively on a spot basis at key hubs.

Volumes are rated on a barrel a day basis at quantities of 1,000-10,000 b/d over a

month, and transactions are completed at least five days prior to the start of the

delivery month in order to allow for pipeline scheduling. This also permits muchsmaller transactions and greater flexibility than in the international crude oil cargo mar-ket. Nymex futures quotations for WTI usually serve as a reference for most spot trans-actions. Widely traded grades like West Texas Sour, Light Louisiana Sweet, and HeavyLouisiana Sweet have their own trading hubs and are usually marketed at either a dis-count or premium to WTI prices depending on quality and location.

The US oil market is going through some important changes that should have

a significant impact on the competitive position of imported supplies. The decline

in onshore production and rising internal demand mean increasing requirements

for international supplies and pipelines to bring these crude oils to inland refin-

ers that previously depended on domestic grades. At the same time, rising pro-

duction from new offshore fields in the Gulf Of Mexico mean a more competitive

environment for sour grades in that key market area. About 1-million b/d of newproduction is expected by 2000 from the new deep-water and sub-salt fields in the Gulf,and over 60% of this crude oil is high in sulfur like the new Mars blend. These grades areexpected to be actively traded in the US Gulf spot market, competing head-to-head withMideast and Latin American barrels. At the same time, the need to bring more interna-tional crude oil to refiners in the Midcontinent and Great Lakes regions has required theexpansion of pipeline systems in order to avoid supply bottlenecks.

VENEZUELA

The marketing of Venezuelan crude oil has always been a challenge because of

its relatively poor quality, but the stakes have been raised in the mid-1990s by an

upswing in the country�s output and exports that now looks likely to extend for

several years. State Petroleos de Venezuela has managed to meet the challenge by

using a combination of old and new marketing techniques. With crude oil reservesin excess of 60-billion barrels, the country has the largest pool of reserves outside theMideast. But PDV�s Achilles� heel is that much of itscrude oil is heavy and high in sulfur and metals,requiring special efforts to market it. However, bybuilding sophisticated export-refining capability andinvesting carefully in downstream ventures over-seas, Venezuela was able to lock in secure marketoutlets for over half of its oil exports in the early1990s. As a result, despite quality problems, it hasmade itself among the least vulnerable of Opec exporters to competitive market pres-sures, and it has had little trouble expanding crude oil exports to 1.8-million barrels aday in 1995 and over 2-million b/d in 1996 (see pH261-H272).


PDV faces an uphill battle on the quality front, with its reserves dominated by

heavy grades. However, most of its export growth in the mid-1990s has been with itsmedium- and light-gravity grades, which reflects both rising production of these oils andincreased upgrading capacity at domestic refineries, allowing them to switch to heaviercrude oil feedstock. There are already limits to how much heavy crude oil Venezuela�sdomestic and overseas refining system can take, and PDV is forced to buy significant vol-umes of lighter grades from other producers to supplement its own production. It alsohas brought in international oil companies to improve recovery from existing fields andexpand output from new ones, which should add to exports in the future. These newflows could also further complicate crude oil marketing arrangements with the emer-gence of new sellers.

In the face of these challenges, the backbone of Venezuela�s crude oil export

program is its overseas refining capability of about 1.5-million barrels a day,

which received almost 900,000 b/d of supplies directly from Venezuela in 1995

with additional supplies purchased from the open market. This left about 925,000

b/d of domestically produced crude oil to sell to third parties. PDV also exports

about 700,000 b/d of refined products from its domestic refineries, which have a

capacity of 1.2-million b/d. PDV�s downstream assets in the US include ventures withCitgo, Champlin, Unoven, Seaview, Chevron, and Lyondell, as well as a long-term leaseon the 300,000 b/d Curacao refinery. In Europe, PDV owns shares of refineries inGermany, Belgium, and Sweden with German Veba and Swedish Nynas, amounting tosome 245,000 b/d. Crude oil sales to its own downstream outlets are secured by �realiza-tion� pricing that ties the value of the crude oil to the output of refined products.

Since 1992, Venezuela has shifted its third-party crude oil sales more heavily

toward spot-linked transactions, which it had shunned previously but has since

embraced wholeheartedly. This market-responsive system has allowed Venezuela

to expand its international sales relatively easily since 1993 as its production has

grown. Pricing terms are set individually to suit the particular needs of customers.

The spot-linked sales are primarily targeted at US refiners, which took about 70% ofVenezuela�s 2-million b/d crude oil exports in 1996, with about a third of that 1.4-millionb/d going to PDV downstream ventures. Because price terms are set individually, crudeoil costs vary among customers. While the main buyers are heavy-crude oil-oriented refin-ers such as Mobil, Conoco, Phillips, Amoco, and Star Enterprise, new flows of lightergrades have allowed Venezuela to market to firms such as Phibro and Coastal. The newpricing strategy has helped Venezuela to expand its sales and makes it difficult for othersuppliers to displace it. The preference of US refiners for low inventories also makes thenearby Venezuelan crude oil with its spot-linked pricing especially attractive.

PDV�s old system of postings is still in use, but it is at best only a partial indi-

cator of price levels. The PDV postings are still used as one element in some of thenew sales formulas, but prices are generally believed to be about 50¢ to $1 a barrelbelow the postings, and most formulas have a timing element to protect customers dur-ing crude oil shipment. PIW has begun tracking the formula price of Furrial crude oil,providing a more accurate measure of price levels, which appear to be quite competi-tive (see Furrial prices, pI29).

Venezuela is likely to keep expanding its downstream network overseas as it

expands its oil production because of the security this provides for crude oil

sales. The more open posture Caracas has taken to international upstream investment in


the country could also help forge such deals. However, competition in the key US mar-ket is likely to grow more intense with rising US output of sour crude oils from the GulfOf Mexico and the reemergence of Iraq as a sour crude oil exporter.

PDV subsidiaries Lagoven, Maraven, Corpoven, and Meneven are the operat-

ing companies for production and refining, and they also handle crude oil

exports. PDV has sought to minimize past competition for customers among them byrestricting buyers to using a single affiliate. Venezuela has over a dozen main crude oilexport grades, with several other minor streams.

VIETNAM

Vietnam was a rising star of Asia-Pacific oil production in the early 1990s, but it has

since lost much of its luster. Although it has managed to boost production to over

150,000 barrels a day, it has yet to live up to the hopes that many international oil

companies placed on its upstream potential, and exports are likely to at best hold

steady rather than more than double by 2000 as the government has projected. Theproblem is that all of the discoveries by international oil compa-nies so far have turned out to be relatively small despite somepromising initial assessments. The Bach Ho field, originally dis-covered by Mobil but developed by the Russians, is the main pro-ducing field at about 125,000 b/d (see pH273). The smaller Rongand Dai Hung fields produce most of the rest of the output, withthe 25,000 b/d Ruby field slated to come on stream in late 1996.

Almost all production is exported due to the lack of

domestic refining capacity. Vietnam�s 33-gravity Bach Ho export grade is typical

of medium-gravity Asian grades, which are low in sulfur but high in wax. This

quality constraint and the country�s strong commercial links with Japanese trad-

ing houses mean that about 50% of exports still go to Japan, despite an effort byVietnam to diversify its outlets. In the future, the big challenge for Vietnam as an exporterwill likely be to keep its output expanding quickly enough to stay ahead of the coun-try�s demand, which is also growing rapidly. However, plans to build a domestic refin-ery have stalled, and virtually all production is likely to continue to be exported until latein the 1990s.

Bach Ho prices have been set with a link to similar-quality Indonesian Minas

grade. State producer Petrovietnam and state oil market Petechim are both responsiblefor crude oil sales. In addition to the Japanese, Singapore refiners have also been activebuyers. With the lifting of the US ban on trade with Vietnam in 1995, US majors such asMobil began to buy the crude oil.

YEMEN

Although Yemen has fallen short of the high expectations that it set for its out-

put potential, it has managed to achieve flows of about 350,000 barrels a day

mainly from its Marib and Masila fields. With no major increases in production

on the horizon, state Yominco started to trim its term sales on Marib crude oil in

1996 to meet rising domestic demand (see pH275-278). About 65,000 b/d of Marib isbeing processed at the 100,000 b/d Aden refinery to meet local product needs, leavingonly about 35,000 b/d of term sales by Yominco plus offtake of about 100,000 b/d byequity producers Hunt, Exxon, and South Korean Yukong. Marib crude oil has become


progressively lighter with the injection of condensate from associated gas, making it anextremely light 49-gravity stream. Heavier Masila is produced by Canadian Occidentaland reached plateau levels of 120,000 b/d in 1994.

The grades are sold by the equity producers and by Yominco, which has about

a 50% share of output from both streams. Supplies move to Asia, Africa, Europe,

and the US, depending on market circumstances, but

Japan and other Asian markets have become prima-

ry outlets. Key Yominco buyers include Japanese refin-ers Japan Energy, Mitsubishi Oil, trading house Sumitomo,US Unocal, South Korean Yukong, and French Total.Traders such as Glencore and Phibro also have contracts.Exxon markets Hunt�s share of Marib as well as its own,keeping significant volumes in its refining system. Masila tends to compete directly withsimilar-quality Oman crude oil in Asian markets and sometimes is priced at a differentialto it in the spot market.

As an indication of Yemen�s solid marketing position, it is able to price its

grades with direct linkage to the distant North Sea Brent market, even with its

large Asian sales base. It also does not provide any timing delay in its price formula,which is customary for other Mideast producers that use spot Brent as a marker gradefor their sales. Additionally, Yominco sets its price formulas quarterly rather than month-ly. However, the higher condensate content of the Marib stream has made it a bit hard-er to sell competitively.

TTrraaddee


Term Contracts & Trade Flows By Country And Company . . . . . . . . . . . . . .G1

PIW�s Term Deals By Producing Nation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G3

PIW�s Term Deals By Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G16

US Crude Oil Imports By Company And Country Of Origin, 1991-95 . . . . . .G33

US Crude Oil Imports By Country Of Origin And Company, 1991-95 . . . . . .G40

CRUDE OIL HANDBOOK PIW © G1

TTeerrmm CCoonnttrraaccttss AAnndd TTrraaddee FFlloowwss

BByy CCoouunnttrryy AAnndd CCoommppaannyy

The following tables provide unique insights into the structure of crude oil trade

by presenting data that track crude oil sales volumes by company and by coun-

try. The first set of tables is from PIW�s regular tracking of term contract sales

volumes for crude oil. These are presented as sales from each country to partic-

ular companies and then as purchases by each company from particular coun-

tries. These data are a snapshot of the term contract arrangements that existed at a pointin time during the first half of each year shown from 1989 to 1995. Users of these datashould remember that term contract volumes shift constantly through the year, and thedata here are simply samplings of the commitments, not measurements of the averagevolume for the entire year. Nevertheless, the volumes do provide a unique and highlyuseful indication of the relative trends in term contract sales volumes. All regularized vol-umes have been included here, where possible, even if they exceed the nominal termcontract volume that a company might be committed to. The term contract sales volumesshown here are those by state oil companies or governments, and they exclude liftingsby foreign equity producers or volumes destined for the internal market. Purchasers areshown according to their current names or names that were in use at the time of pur-chases. Sometimes country names are used to indicate state-to-state deals.

Following the tables on term contract volumes is a set of tables that provide

valuable detail on US crude oil imports by country and by company for 1991-95.

Like the tables on term contracts, they show the volume of crude imported into

the US by each company broken down by country of origin, and they also show

the imports into the US from each country broken down by importing company.

Unlike the data on term contracts, these volumes are only for the US, and they includespot purchases, equity crude production, and other volumes in addition to term contractsupplies. They also are annual average volumes rather than snapshots at a particularpoint in time.


PIW�s TERM DEALS BY PRODUCING NATION (In 1,000 b/d)

Volume DestinationAbu Dhabi 1989 1992 1993 1995 in 1995Agip ... 10 10 ... ...Bangladesh ... 5-10 ... ... ...BPC ... ... ... 20 BangladeshCosmo 10 20-30 20 25 JapanCPC (Sri Lanka) ... ... ... 9 Sri LankaCPC (Taiwan) ... 10 10 5 TaiwanHonam ... 20 34 20 South KoreaHyundai ... ... ... 10 South KoreaIdemitsu 50 60 60 40 JapanIndian Oil Corp. 10 20 20 20 IndiaItochu ... 10-20 10-20 ... ...Kanematsu 15 17 17 17 JapanKukdong ... 10 10 ... ...Kyushu ... ... ... 15 JapanMarubeni ... ... ... 10 JapanMitsubishi Corp. ... 20 20 30 JapanMitsubishi Oil 15 ... 20 20 JapanMitsui 10 10-15 10-15 ... ...Mobil ... 20 20-30 20-30 EastNeste ... 20 20 20 KenyaNippon Oil 20 40 40 30 JapanPakistan ... 10 10 10 PakistanPetrofina ... 20-30 20 ... ...RD/Shell ... 67 67 20 EastShowa Shell 10 20 20 30 JapanTexaco 10 ... ... ... ...Thai Oil ... ... ... 16 ThailandTotal (France) ... 17 17 ... ...Tupras ... ... 48 ... ...Yukong ... 17 35 20 South KoreaTotal 150 442.5-482.5 537.5-562.5 402-432 ...

ChinaCoastal 30-60 30 ... ... ...Japan 165 190 180 ... ...Kyung-In ... ... 20 ... ...Phibro 40 25 ... ... ...PNOC ... 5 2 ... ...Yukong ... 20 10 ... ...Total 235-265 270 212 ... ...

ColombiaBP 15 17 16 16 USCosta Rica ... 6 ... 16 Costa RicaInterpetrol ... 17 ... ... ...Mobil ... ... 16 ... ...Murphy 15 17 16 ... ...Petroperu ... ... 6 ... ...Petrotrin ... ... ... 16 TrinidadPhibro 15 33 16-32 16 USScanoil 15 ... ... ... ...Sun ... 17 16 16 USTotal 60 105 85.5-101.5 80 ...

EcuadorAnglo Energy ... 12 12 12 US/Latin AmericaCoastal 15 ... 12 ... ...

G4 PIW © CRUDE OIL HANDBOOK


Volume DestinationEcuador (cont.) 1989 1992 1993 1995 in 1995Commoil 15 ... ... ... ...Copec-Chile 15 ... ... ... ...CPC (Taiwan) 15 24 ... ... ...Elf ... ... ... 18 US/Latin AmericaGlencore* ... ... ... 24 US/Latin AmericaInterpetrol ... ... 12 12 US/Latin AmericaItochu 15 ... ... ... ...Lucky Goldstar 25 24 27 36 South KoreaMarc Rich (Clarendon) ... 12 12 ... ...Oil Tex ... 12 12 24 US/Latin AmericaPetrobras 15 ... 12 ... ...Phibro ... ... 0-12 ... ...Ssangyong 25 ... ... ... ...Tevier ... ... 12 12 US/Latin AmericaTexaco ... ... 12 12 US/Latin AmericaTosco ... ... ... 12 USTotisa ... ... 12 12 US/Latin AmericaTripetrol 15 48 12 36 US/Latin AmericaWickland ... ... ... 12 US/Latin AmericaYukong ... 24 24 24 South KoreaTotal 155 156 171-183 246 ...

EgyptAfrica Middle East ... 10 ... ... ...Anglo Energy ... 6 ... ... ...Bayoil ... 6-9 ... ... ...BB Naft ... 6 ... ... ...Bulk ... 5-7 ... ... ...CPC (Sri Lanka) ... 3 ... ... ...Cameli ... 3 ... ... ...Chevron ... 6 ... ... ...Citizens Resources ... 3 ... ... ...Coastal ... 2 ... ... ...Elf ... 3 ... ... ...Exxon ... 4 ... ... ...Gotco ... 3-4 ... ... ...Greece ... 8 ... ... ...Israel ... 40 ... ... ...Koch ... 5-7 ... ... ...Marc Rich ... 6-9 ... ... ...Marimpex ... 4 ... ... ...Mitsui ... 3 ... ... ...Mobil ... 4 ... ... ...Motor Oil Hellas ... 6 ... ... ...OMV ... 7-9 ... ... ...Phibro ... 5-7 ... ... ...Repsol ... 3 ... ... ...Romania ... 6 ... ... ...Sonangol (Angola) ... 4 ... ... ...Star Enterprise ... 10 ... ... ...Total ... 169-185 ... ... ...

IndonesiaFEOT/JIOC � varies 180 220 ... ...Inpex ... ... 30 ... ...

*Formerly Marc Rich. � Now Pacific Petroleum & Trading Co.



Volume DestinationIndonesia (cont.) 1989 1992 1993 1995 in 1995Kitco varies 45-50 ... ... ...Perta varies 45-50 ... ... ...Samudra varies 15-20 ... ... ...Total 150 285-300 250 ... ...

IranAgip ... 30-50 ... 50 ItalyAPI ... ... ... 20-25 ItalyBayoil ... 30 60-70 70 Romania/BulgariaBP § ... ... 80-150 200 EuropeBurgas Refinery ... ... ... 30 BulgariaCaltex ... 60-65 60-130 60 EastCameli ... 80-120 ... ... ...Cargill ... 60-80 65 ... ...Cepsa ... ... ... 15 SpainChevron ... 60 0-60 ... ...China ... ... ... 10-20 ChinaCoastal ... 130-150 80-125 130 Europe/CaribbeanCosmo 30 45 45 45 JapanCPC (Sri Lanka) ... 20 20 ... ...CPC (Taiwan) ... 40 40 30 TaiwanDreyfus 100 ... ... ... ...Elf ... 50-60 90 20-30 FranceExxon ... 250-300 200-300 250-300 East/WestGdansk Refinery ... ... ... 30 PolandGeneral Sekiyu ... 30 ... ... ...Gotco ... 25 ... ... ...Greece �� ... ... ... 100 GreeceHanwha ... ... ... 40 South KoreaHonam ... ... ... 65 South KoreaHyundai ... ... ... 60 South KoreaIdemitsu 20 30 30 50 JapanIndian Oil Corp. 20 60 60 60 IndiaIndonesia 30 ... ... ... ...Isab Garrone ... 40-50 40-50 35 ItalyItochu 40 30 25 30 JapanKanematsu 20 30 20 40 JapanKukdong ... 25 25 ... ...Kyung-In ... ... 20 ... ...Marc Rich 200 100-120 150-175 ... ...Marimpex varies ... ... ... ...Marubeni 20 30 25 30 JapanMitsubishi Corp. 20 20 25 20 JapanMitsubishi Oil 10 15 15 ... ...Mitsui 30 25 20 20-25 JapanMobil ... 40 25 40-50 EastN. Korea 40 10 ... ... ...Neste ... ... 0-40 ... ...Nippon Oil ... ... ... 30 JapanNissho Iwai 20 ... ... ... ...Nova (Greece) ... ... 60 ... ...OK Petroleum ... ... ... 30 SwedenOMV ... 30 20-30 5-10 Austria

§ Excluding purchases for South African refineries �� Motor Oil Helas, DEP, and Petrola.



Volume DestinationIran (cont.) 1989 1992 1993 1995 in 1995Pakistan ... 20 40 20 PakistanPetrobras 60 180 75 60 BrazilPetrofina ... 50-100 0-75 75 BelgiumPetrogal ... ... ... 30 PortugalPetronas ... 15 ... ... ...Petronor ... ... ... 30-40 SpainPhibro 175 30-50 0-80 ... ...PNOC ... 27 20 ... ...Poland ... 60-72 50 ... ...PTT (Thailand) ... 15 ... ... ...Rafiron ... ... ... 65 RomaniaRepsol ... ... ... 30-35 SpainRomania ... 16 ... ... ...RD/Shell § 70 50-70 70 50 East/WestShowa Shell 20 25 25 30 JapanSinochem ... 20 ... ... ...Sonatrach ... ... 60 ... ...South Africa ¶ ... ... ... 200-250 South AfricaSri Lanka ... ... ... 20 Sri LankaSumitomo 20 15-20 20 40 JapanTotal (France) § ... 20 0-40 10-15 FranceToyomenka 40 50 50-125 60-70 JapanTupras ... ... 60-80 100 TurkeyVitol 100 50-60 ... ... ...Yugoslavia 20 ... ... ... ...Yukong ... 70 70 70 South KoreaTotal 1,255 2,108-2,420 1,840-2,570 2,505-2,680 ...

IraqAgip 60 ... ... ... ...Ashland 35 ... ... ... ...Chevron 70 ... ... ... ...Coastal 50-70 ... ... ... ...Cosmo 30 ... ... ... ...Crown Central 35-70 ... ... ... ...Elf varies ... ... ... ...Exoil 10 ... ... ... ...Exxon 200 ... ... ... ...Idemitsu 40 ... ... ... ...Indian Oil Corp. 70 ... ... ... ...Indonesia 30 ... ... ... ...Kashima 10 ... ... ... ...Marathon 35 ... ... ... ...Mitsubishi Corp. 20 ... ... ... ...Nippon Oil 35 ... ... ... ...Petrobras 150-200 ... ... ... ...Poland 25 ... ... ... ...RD/Shell 50-100 ... ... ... ...Repsol 100 ... ... ... ...Showa Shell 10 ... ... ... ...Texaco 100-150 ... ... ... ...Total (France) varies ... ... ... ...Total 1,265-1,470 ... ... ... ...

§ Excluding purchases for South African refineries. ¶ BP, Shell, Caltex, Total, Sasol, and Engen.



Volume DestinationKuwait 1989 1992 1993 1995 in 1995American Petrofina ... ... 0-30 ... ...Amoco 60 ... 0-30 ... ...Ashland ... ... 0-60 50 USBP ... ... 0-30 ... ...Chevron ... ... 65 30-35 USCosmo ... 30 50 70 JapanCPC (Taiwan) ... 30 40 40 TaiwanExxon ... 100 120-140 100-125 East/WestHanwha ... ... ... 20 South KoreaIdemitsu 30 20 40 50 JapanIndian Oil Corp. 10 80 80 90-100 IndiaItochu ... ... 10 ... ...Ivory Coast ... ... ... 25 Ivory CoastJapan Energy Corp. ... ... ... 10 JapanKuwait Pet. Intl. 130 90 90 ... ...Kyung-In ... 20 20 ... ...Marathon ... ... 0-30 50 USMitsubishi Corp. 20 20 20 ... ...Mitsui 20 ... ... ... ...Pakistan ... ... ... 50-70 PakistanPetrobras 30 ... ... 50 BrazilPetrofina ... ... ... 25 BelgiumPhillips ... ... 0-30 17 USPNOC ... ... 20 ... ...RD/Shell ... ... 180 100-150 East/WestRepsol ... ... 0-30 ... ...Saras �� ... ... 30 20 ItalySasol ... ... ... 30 South AfricaSeibu ... ... 20 20 JapanShell US ... 100 0-60 15 USSRC �� ... ... ... 30 SingaporeSumitomo 20 20 ... ... ...Texaco ... ... ... 35 USYukong ... 20 60 70 South KoreaTotal 320 530 845-1,165 997-1,107 ...

LibyaAgip ... ... 100 100 ItalyAPI ... ... 20 20 ItalyBorgas (Bulgaria) ... ... varies ... ...BP ... 15-20 ... ... ...Coastal/Holborn 90 50 50 ... ...Daewoo ... 30 30-50 ... ...DEP (Greece) ... ... ... 20 GreeceElf ... 20-30 30 40 FranceGreece ... 20 20 ... ...Jaco Rossi ... 60 ... ... ...Marimpex ... 20 ... ... ...Nova (Canada) ... ... ... 10 EuropeNova (Greece) ... 20-40 40 40 GreeceOMV 20 85-90 90 110 AustriaRD/Shell ... 20 20 ... ...Repsol 60 90 100 100 SpainSinochem a ... ... ... ... ...Sudan ... 25 ... ... ...

�� KPC processing deals. a Dormant contracts.



Volume DestinationLibya (cont.) 1989 1992 1993 1995 in 1995Tamoil 100 240-280 250 250 Germany, Switzerland, ItalyTotal (France) ... ... 20 10 FranceTupras ... 60 48 50 TurkeyTotal 270 755-835 818-838 750 ...

MalaysiaAstra ... 5 ... ... ...BP ... 5-10 ... ... ...Cosmo ... ... 5 5 JapanCPC (Sri Lanka) ... 10 6 6 Sri LankaCPC (Taiwan) ... ... 9 9 TaiwanElf ... 5-10 ... ... ...Exoil ... 5-10 ... ... ...Exxon ... 30-35 ... ... ...Hanwha ... ... ... 10-15 South KoreaHonam ... 15 17 12 South KoreaIdemitsu ... 5 5 5 JapanIndian Oil Corp. ... 30 30 10 IndiaKyung-In ... 10-15 21 ... ...Marubeni ... ... 3 3 JapanMitsubishi Corp. ... 5-10 8 8 JapanMobil ... 10-15 ... ... ...Nippon Oil ... 10-15 15 15 JapanPNOC ... 5-10 ... ... ...PTT (Thailand) ... 15 5-10 10 ThailandRD/Shell ... 5-10 ... ... ...Showa Shell ... ... 3 3 JapanSingapore Petroleum ... 5-10 ... ... ...Sinochem ... ... ... 20 ChinaTaiyo ... 15-20 15-20 20 JapanTexaco ... 10-15 ... ... ...Yukong ... 15-20 32 17 South KoreaOthers ... ... 20-25 ... ...Total ... 215-285 194-209 153-158 ...

MexicoAmerican Petrofina 15 20 25 ... ...Amoco ... 65 65 65 USBP ... ... ... 20 SpainCentral America ... ... ... 50 Central AmericaCepsa 30 40 ... 20 SpainChevron 120 120-130 120 125 USCitgo 75 40 60 20 USClark ... 35 30 30 USCoastal 20 35 30 30 USConoco 50 30 40 80 USElf 20 15 ... ... ...Ertoil ... 10 ... ... ...Exxon 30 30 15 ... ...Fina ... ... ... 30 USHunt ... 5-10 8 5 USIsrael ... 30 ... ... ...Japan 180 100 100 80 JapanKoch ... 10 20 25 USLyondell 60 70 30 ... ...Marathon 90 60 60 20-25 USMobil 90 100 125 90 US



Volume DestinationMexico (cont.) 1989 1992 1993 1995 in 1995Murphy 15 18 ... 15 USOMV 5 25 30 ... ...Petro-Canada ... 15 15 10 CanadaPetrofina 20 30 ... 14 BelgiumPetrogal 10 30 ... 13 PortugalPetromed 40 20 ... ... ...Petronor 50 ... ... ... ...Phillips ... ... ... 20 USRepsol 100 190 160 85 SpainS. Korea ... 10 ... ... ...San Jose Accord 45 53 50 ... ...Shell Canada ... ... 4 3 CanadaShell US � 65 60-70 80 120 USSun ... 30 30 15-20 USTotal (France) 60 25 30 20 France/UKUS SPR 45 ... ... ... ...Others ... ... 80 ... ...Total 1,235 1,321-1,346 1,207 1,005-1,015 ...

NigeriaAddax 100 ... ... ... ...Amni ... ... ... 20 East/WestArcadia ... ... 20 20 East/WestAttock ... 40 45 ... ...Basic Resources a ... 30 30 20 East/WestCalson (Vitol) ... ... ... 30 East/WestChevron 50 50 50 ... ...Clarendon (Glencore) ... ... ... 30 East/WestCitizens Resources ... ... 30 ... ...Coastal ... 30 30 ... ...Dreyfus ... 30 30 ... ...Elf 50 30 60 ... ...Erik Emborg ... ... ... 30 East/WestErtoil 50 30 ... 20 SpainFerrostaal ... ... ... 40 East/WestGhana ... 30 20 20 GhanaHachuel Oil ... ... ... 30 East/WestIncomed ... ... 30 30 East/WestInterpetrol ... 30 ... ... ...IPCO ... ... ... 20 East/WestITOC ... 10 ... ... ...Itochu ... 30 30 20 East/WestLyondell 30 ... ... ... ...Mapco 50 ... ... ... ...Marc Rich ... 40 30 ... ...Metalchim ... 20 20 ... ...Moncrief Oil ... ... ... 20 East/WestNeste ... 40 40 ... ...Neste/Thyssen ... 20 ... ... ...Nigermed ... 30 30 ... ...Nova (Canada) ... 20 20 20 East/WestNova (Greece) ... ... ... 20 East/WestOK Petroleum ... 20 ... 20 SwedenOranto (First Fuels) ... ... ... 20 East/West

� Beginning in May 1995, Shell�s contract increased from 50,000 b/d to 120,000 b/d. a Addax in 1989.



Volume DestinationNigeria (cont.) 1989 1992 1993 1995 in 1995Petrogas (Glencore) ... ... ... 30 East/WestPetrojam ... 20 20 ... ...Petromed 70 ... ... ... ...Phibro 60 ... 30 ... ...Queen Petroleum ... ... ... 20 East/WestRagma Oil ... ... ... 20 East/WestRepsol ... ... ... 40 SpainRD/Shell 50 30 ... ... ...Scandinavian Trading ... ... ... 20 East/WestSouthern Petroleum ... 40 30 ... ...Sun 75 60 60 ... ...Tevier ... ... 40 ... ...Texaco ... 30 30 ... ...Togo ... ... ... 10 TogoTotal (France) 80 ... ... 40 East/WestToyomenka ... ... ... 30 East/WestVeba ... 30 30 ... ...Vermont (Vitol) ... ... ... 20 East/WestVitol ... ... ... 30 East/WestVTT Vulcan ... ... ... 30 East/WestWind Pemiy NV ... ... ... 30 East/WestWintershall ... ... ... 30 GermanyTotal 665 740 755 780 ...

OmanBP ... 7 ... 10 EastCaltex ... ... ... 10 EastCPC (Taiwan) ... ... 15 15 TaiwanElf ... 10 10 10 EastHanwha ... ... ... 20 South KoreaHonam ... 20 22 20 South KoreaIdemitsu 40 30-40 30-40 35 JapanItochu ... 20 20 15 JapanKashima 10 12 12 10-15 JapanKukdong ... 10 ... ... ...Kyung-In ... 15-20 32 ... ...Marubeni ... 10 10 10 JapanMitsubishi Corp. ... 17 17 10 JapanMitsui ... 12 12 10-15 JapanMobil 20 ... ... 10 EastNeste ... 20 20 ... ...Nippon Oil 20 20 20 20 JapanNissho Iwai ... ... 10 10 JapanPTT (Thailand) ... 10 ... ... ...RD/Shell ... 40 40 50 EastSinochem ... ... ... 20 ChinaSumitomo ... ... 10 10 JapanTransworld 50 110 110 50 EastYukong ... ... 29 20 South KoreaTotal 140 363-378 419-429 365-375 ...

QatarBritish Aerospace ... 10 ... ... ...Cosmo ... 15 20 20 JapanCPC (Taiwan) ... 10 10 10 TaiwanElf 15 35 ... 15 EastExxon ... 25 ... ... ...



Volume DestinationQatar (cont.) 1989 1992 1993 1995 in 1995Golden Bell ... ... ... 10 South KoreaGulf Interstate ... 25 ... ... ...Honam (via Caltex) ... ... ... 10 South KoreaIdemitsu ... 30 30 30 JapanItochu 30 50 50 50 JapanKanematsu 15 ... ... ... ...Kyung-In ... 8 10 ... ...Marubeni 50 50 50 45 JapanMitsubishi Corp. 50 50 50 50 JapanMitsui 20 ... ... 30 JapanMobil 25 25 25 25 EastNippon Oil ... 10 10 10 JapanPakistan ... ... ... 10 PakistanPetrobras 25 ... 25 20 BrazilTexaco ... 10 ... ... ...Total (France) ... ... 20 ... ...Yukong ... 10 10 10 South KoreaTotal 230 338 335 345 ...

Saudi ArabiaAgip 50 60 60 70 ItalyAmoco 50 100 120 50-55 USAPI ... 20 ... 20 ItalyAramcoPartners 950 1,405-1,550 1,455-1,650 1,100-1,170 East/West

Chevron ... 300-325 300-325 270 East/WestExxon ¶ ... 650-700 700-800 450 East/WestMobil ¶ ... 375-425 375-425 300-350 East/WestTexaco ... 80-100 80-100 80-100 East/West

Ashland 100 150 150 50 USBP 100 140 190 185 East/WestCepsa 100 60 60 75 SpainCosmo ... 50 70 60 JapanCPC (Sri Lanka) ... ... ... 5 Sri LankaCPC (Taiwan) 50-100 100 100 90 TaiwanElf 50 50 50 65 FranceGreece � ... 50 50 80 GreeceHanwha ... ... ... 20 South KoreaHess ... ... 35 65 USHonam ... 30 30 30 South KoreaHunt ... ... ... 12 USHyundai ... ... ... 50 South KoreaIdemitsu ... 100 100 120 JapanIndian Oil Corp. 60 100 100 120 IndiaIndonesia ... 20 ... ... ...Irving Oil ... 50 50 50 USIsab Garrone 35 30-50 30 30 ItalyJapan Energy Corp. 60 100 100 100 JapanKPI/KPC ... 75 ... ... ...Kukdong ... 20 45 ... ...Kyung-In ... ... 20 ... ...Lion Oil ... 25 ... 25 USLyondell 50 50 ... ... ...

¶ Includes both contractual and extra-contractual volumes. � Motoroil Hellas, DEP and Petrola.



Volume DestinationSaudi Arabia (cont.) 1989 1992 1993 1995 in 1995Marathon 60 125 125 100 USMindo/Pertamina ... ... ... 55 IndonesiaMitsubishi Corp. 100 ... 58 60 JapanMitsubishi Oil ... 50 20 20 JapanNeste 90 30 ... ... ...Nippon Oil ... 50 70 100 JapanOK Petroleum ... ... ... 50 SwedenPakistan ... 50 40 45 PakistanPetrobras 120 150-200 200 150 BrasilPetrofina ... 20 20 65 BelgiumPetrogal ... ... ... 65 PortugalPetrolimpex ... 25 ... ... ...Petron ... ... ... 150 PhilippinesPhibro ... 15 ... ... ...Phillips 50 60 60 65-75 USPNOC ... 60 60 ... ...Repsol ... 30-50 100 100 SpainRheinoil 35 90 90 90 GermanyRD/Shell ¶ 300 600 800 550-600 East/WestSaras ... ... 35 ... ...Shell US ... 50 50-80 30 USSinochem ... 25 ... 30 ChinaSsangyong ... 200 170-300 350 South KoreaStar Enterprise 550 550 550 550 USSun 50 50 50 75-80 USTaiyo � ... ... ... 50-60 JapanTotal (France) 50 50 50 90 France/South AfricaTupras ... 160 160-180 176 TurkeyYukong ... 50-100 80 80 South KoreaTotal 3,060-3,110 5,275-5,560 5,603-5,978 5,568-5,718 ...

SyriaAgip ... ... 20 20 ItalyAPI ... ... 16-25 10 ItalyBayoil ... 20 30-33 ... ...BP ... ... ... 25 EuropeCepsa ... ... ... 2 SpainChevron ... ... ... 10 EuropeCoastal ... ... ... 15 EuropeConoco ... ... 30-33 25 EuropeElf ... ... 6-12 20 FranceMarc Rich/Galaxy ... ... 30-33 3 EuropeGlencore ... ... ... 20 EuropeIsab Garrone ... ... 16-25 15 ItalyLebanon ... 40 20 ... ...Mobil ... ... ... 10 EuropeOMV ... 20 20 10 AustriaRepsol ... ... ... 25 SpainRheinoil ... ... 6-12 20 GermanySocap ... ... ... 3 EuropeTexaco ... ... ... 20 EuropeTotal (France) ... 20 30-33 30 FranceTupras ... ... ... 20 TurkeyVeba ... 20 30-33 35 GermanyTotal ... 120 254-299 338 ...

¶ Includes both contractual and extra-contractual volumes. � Arab Super Light spot purchases.



Volume DestinationVenezuela 1989 1992 1993 1995 in 1995Amoco 40 18 20 50-60 USAPI ... 2 ... ... ...Caribbean Gulf ... ... ... 35-40 Puerto RicoCameli ... 1 ... ... ...Central America ... ... ... 30 Central AmericaCepsa ... 4 ... 15-20 SpainChevron 20 13 25 15 USCibro ... ... 7-10 ... ...Citgo § 255 310-350 300-320 300-320 USClark ... ... ... 8-16 USCoastal ... 26 15-30 8-10 USConoco 20 85 60-70 40 USElf ... 7 ... ... ...Ergon ... 8 15-25 22 USExxon ... 25 10-20 ... ...Hunt ... 6 8 8 USKoch ... 15 15-25 10 USLyondell § ... 1 100 130 USMobil 40 35 30-100 130 USMurphy ... ... ... 15 USNynas 30 24 25 ... ...Nynas Sweden ... ... ... 10 SwedenNynas UK ... ... ... 30 UKPetrobras ... ... ... 50 BrazilPetrotrin ... ... ... 15 TrinidadPhibro ... 1 0-75 45 USPhillips ... ... ... 30 USRD/Shell 30 23 23 15 EuropeRuhr Oel 150 200 200 ... ...San Jose Accord 45 53 50 ... ...Smith & Hollander ... 6 ... 5 UKStar Enterprise ... 42 50-60 40 USSun 20 37 15-20 ... ...Tarmac ... 30 ... ... ...Texaco ... 18 10 35-40 USTrifinery ... 9 15-20 15 USUnoven § ... 120 120 135 USVeba ... ... ... 40 GermanyTotal 650 1,117.2-1,157 1,113-1,366 1,281-1,336 ...

VietnamIdemitsu ... 7 9 ... ...Japan Energy Corp. ... ... 8 ... ...Kuo International ... 7 10-20 ... ...Marubeni ... 5 5 ... ...Mitsubishi Corp. ... 25 27 ... ...Mitsui ... 5 5 ... ...Nichimen ... 2 ... ... ...Nippon Oil ... 5 ... ... ...Nissho Iwai ... 25 27 ... ...RD/Shell ... 12 ... ... ...Sinochem ... 7 ... ... ...Sumitomo ... 3 14 ... ...Total ... 103 105-115 ... ...

§ Joint venture with state PDV in 1995. Crude invoiced at an internal transfer price, based on the crude feedstock netback value.Citgo venture includes Champlain and Seaview.



Volume DestinationYemen 1989 1992 1993 1995 in 1995Agip 20 ... ... ... ...Chevron ... 10 ... ... ...Coastal ... ... ... 25 EastCosmo ... ... ... 10 EastElf 10 ... ... ... ...Glencore ... ... ... 25 EastHess 20 ... ... ... ...IPG (Kuwait) ... 10 ... 25 EastMitsubishi Corp. ... ... ... 5 JapanMobil ... 22 ... ... ...Phibro ... ... ... 20 EastRD/Shell 10 ... ... ... ...Shell US 20 ... ... ... ...Unocal ... ... ... 20 EastTotal 80 42 ... 130 ...

Grand Total 9,920-10,205 14,454-15,311 14,744.1-16,575 14,945-15,490 ...


PIW�s TERM DEALS BY COMPANY (In 1,000 b/d)

Volume DestinationAddax 1989 1992 1993 1995 in 1995Nigeria 100 ... ... ... ...

Africa Middle EastEgypt ... 10 ... ... ...

AgipAbu Dhabi ... 10 10 ... ...Iran ... 30-50 ... 50 ItalyIraq 60 ... ... ... ...Libya ... ... 100 100 ItalySaudi Arabia 50 60 60 70 ItalySyria ... ... 20 20 ItalyYemen 20 ... ... ... ...Total 130 100-150 190 240 ...

Amerada HessSaudi Arabia ... ... 35 65 USYemen 20 ... ... ... ...Total 20 ... 35 65 ...

American PetrofinaKuwait ... ... 0-30 ... ...Mexico 15 20 25 ... ...Total 15 20 25-55 ... ...

AmniNigeria ... ... ... 20 East/West

AmocoKuwait 60 ... 0-30 ... ...Mexico ... 65 65 65 USSaudi Arabia 50 100 120 50-55 USVenezuela 40 18 20 50-60 USTotal 150 183 205-235 165-180 ...

Anglo EnergyEcuador ... 12 12 12 US/Latin AmericaEgypt ... 6 ... ... ...Total ... 18 12 12 ...

APIIran ... ... ... 20-25 ItalyLibya ... ... 20 20 ItalySaudi Arabia ... 20 ... 20 ItalySyria ... ... 16-25 10 ItalyVenezuela ... 2 ... ... ...Total ... 22 36-45 70-75 ...

ArcadiaNigeria ... ... 20 20 East/West

AshlandIraq 35 ... ... ... ...Kuwait ... ... 0-60 50 USSaudi Arabia 100 150 150 50 USTotal 135 150 150-210 100 ...

AstraMalaysia ... 5 ... ... ...

AttockNigeria ... 40 45 ... ...



Volume DestinationBangladesh 1989 1992 1993 1995 in 1995Abu Dhabi ... 5-10 ... ... ...

Basic ResourcesNigeria ... 30 30 20 East/West

BayoilEgypt ... 6-9 ... ... ...Iran ... 30 60-70 70 Romania/BulgariaSyria ... 20 30-33 ... ...Total ... 56-59 90-103 70 ...

BB NaftEgypt ... 6 ... ... ...

Borgas (Bulgaria)Libya ... ... varies ... ...

BPColombia 15 17 16 16 USKuwait ... ... 0-30 ... ...Libya ... 15-20 ... ... ...Malaysia ... 5-10 ... ... ...Mexico ... ... ... 20 SpainOman ... 7 ... 10 EastSaudi Arabia 100 140 190 185 East/WestSyria ... ... ... 25 EuropeIran ... ... 80-150 200 EuropeTotal 115 184-194 286-386 456 ...

BPCAbu Dhabi ... ... ... 20 Bangladesh

British AerospaceQatar ... 10 ... ... ...

BulkEgypt ... 5-7 ... ... ...

Burgas RefineryIran ... ... ... 30 Bulgaria

Calson (Vitol)Nigeria ... ... ... 30 East/West

CaltexIran ... 60-65 60-130 60 EastOman ... ... ... 10 EastTotal ... 60-65 60-130 70 ...

CameliEgypt ... 3 ... ... ...Iran ... 80-120 ... ... ...Venezuela ... 1 ... ... ...Total ... 84-124 ... ... ...

CargillIran ... 60-80 65 ... ...

Caribbean GulfVenezuela ... ... ... 35-40 Puerto Rico

Central AmericaMexico ... ... ... 50 Central AmericaVenezuela ... ... ... 30 Central AmericaTotal ... ... ... 80 ...



Volume DestinationCepsa 1989 1992 1993 1995 in 1995Iran ... ... ... 15 SpainMexico 30 40 ... 20 SpainSaudi Arabia 100 60 60 75 SpainSyria ... ... ... 2 SpainVenezuela ... 4 ... 15-20 SpainTotal 130 104 60 127-132 ...

ChevronEgypt ... 6 ... ... ...Iran ... 60 0-60 ... ...Iraq 70 ... ... ... ...Kuwait ... ... 65 30-35 USMexico 120 120-130 120 125 USNigeria 50 50 50 ... ...Saudi Arabia ... 300-325 300-325 270 East/WestSyria ... ... ... 10 EuropeVenezuela 20 13 25 15 USYemen ... 10 ... ... ...Total 260 559-594 560-645 450-455 ...

ChinaIran ... ... ... 10-20 China

CibroVenezuela ... ... 7-10 ... ...

CitgoMexico 75 40 60 20 USVenezuela 255 310-350 300-320 300-320 USTotal 330 350-390 360-380 320-340 ...

Citizens ResourcesNigeria ... ... 30 ... ...Egypt ... 3 ... ... ...Total ... 3 30 ... ...

Clarendon (Glencore)Nigeria ... ... ... 30 East/West

ClarkMexico ... 35 30 30 USVenezuela ... ... ... 8-16 USTotal ... 35 30 38-46 ...

CoastalChina 30-60 30 ... ... ...Ecuador 15 ... 12 ... ...Egypt ... 2 ... ... ...Iran ... 130-150 80-125 130 Europe/CaribbeanIraq 50-70 ... ... ... ...Mexico 20 35 30 30 USNigeria ... 30 30 ... ...Syria ... ... ... 15 EuropeVenezuela ... 26 15-30 8-10 USYemen ... ... ... 25 EastTotal 35 253-273 167-227 208-218 ...

Coastal/HolbornLibya 90 50 50 ... ...

CommoilEcuador 15 ... ... ... ...



Volume DestinationConoco 1989 1992 1993 1995 in 1995Mexico 50 30 40 80 USSyria ... ... 30-33 25 EuropeVenezuela 20 85 60-70 40 USTotal 70 115 130-143 145 ...

Copec-ChileEcuador 15 ... ... ... ...

CosmoAbu Dhabi 10 20-30 20 25 JapanIran 30 45 45 45 JapanIraq 30 ... ... ... ...Kuwait ... 30 50 70 JapanMalaysia ... ... 5 5 JapanQatar ... 15 20 20 JapanSaudi Arabia ... 50 70 60 JapanYemen ... ... ... 10 EastTotal 70 160-170 210 235 ...

Costa RicaColombia ... 6 ... 16 Costa Rica

CPC (Sri Lanka)Abu Dhabi ... ... ... 9 Sri LankaEgypt ... 3 ... ... ...Iran ... 20 20 ... ...Malaysia ... 10 6 6 Sri LankaSaudi Arabia ... ... ... 5 Sri LankaTotal ... 33 26 20 ...

CPC (Taiwan)Abu Dhabi ... 10 10 5 TaiwanEcuador 15 24 ... ... ...Iran ... 40 40 30 TaiwanKuwait ... 30 40 40 TaiwanMalaysia ... ... 9 9 TaiwanOman ... ... 15 15 TaiwanQatar ... 10 10 10 TaiwanSaudi Arabia 50-100 100 100 90 TaiwanTotal 65-115 214 224 199 ...

Crown CentralIraq 35-70 ... ... ... ...

DaewooLibya ... 30 30-50 ... ...

DEP (Greece)Libya ... ... ... 20 Greece

DreyfusIran 100 ... ... ... ...Nigeria ... 30 30 ... ...Total 100 30 30 ... ...

ElfEcuador ... ... ... 18 US/Latin AmericaEgypt ... 3 ... ... ...Iran ... 50-60 90 20-30 FranceIraq varies ... ... ... ...Libya ... 20-30 30 40 FranceMalaysia ... 5-10 ... ... ...



Volume DestinationElf (cont.) 1989 1992 1993 1995 in 1995Mexico 20 15 ... ... ...Nigeria 50 30 60 ... ...Oman ... 10 10 10 EastQatar 15 35 ... 15 EastSaudi Arabia 50 50 50 65 FranceSyria ... ... 6-12 20 FranceVenezuela ... 7 ... ... ...Yemen 10 ... ... ... ...Total 145 225-250 246-252 188-198 ...

ErgonVenezuela ... 8 15-25 22 US

Erik EmborgNigeria ... ... ... 30 East/West

ErtoilMexico ... 10 ... ... ...Nigeria 50 30 ... 20 SpainTotal 50 40 ... 20 ...

ExoilIraq 10 ... ... ... ...Malaysia ... 5-10 ... ... ...Total 10 5-10 ... ... ...

ExxonEgypt ... 4 ... ... ...Iran ... 250-300 200-300 250-300 East/WestIraq 200 ... ... ... ...Kuwait ... 100 120-140 100-125 East/WestMalaysia ... 30-35 ... ... ...Mexico 30 30 15 ... ...Qatar ... 25 ... ... ...Venezuela ... 25 10-20 ... ...Saudi Arabia ... 650-700 700-800 450 East/WestTotal 230 1,114-1,219 1,060-1,290 800-875 ...

FEOT/JIOCIndonesia varies 180 220 ... ...

FerrostaalNigeria ... ... ... 40 East/West

FinaMexico ... ... ... 30 US

Gdansk RefineryIran ... ... ... 30 Poland

General SekiyuIran ... 30 ... ... ...

GhanaNigeria ... 30 20 20 Ghana

GlencoreEcuador ... ... ... 24 US/Latin AmericaSyria ... ... ... 20 EuropeYemen ... ... ... 25 EastTotal ... ... ... 69 ...

Golden BellQatar ... ... ... 10 South Korea



Volume DestinationGotco 1989 1992 1993 1995 in 1995Egypt ... 3-4 ... ... ...Iran ... 25 ... ... ...Total ... 28-29 ... ... ...

GreeceEgypt ... 8 ... ... ...Libya ... 20 20 ... ...Saudi Arabia ... 50 50 80 GreeceIran ... ... ... 100 GreeceTotal ... 78 70 180 ...

Gulf InterstateQatar ... 25 ... ... ...

Hachuel OilNigeria ... ... ... 30 East/West

HanwhaIran ... ... ... 40 South KoreaKuwait ... ... ... 20 South KoreaMalaysia ... ... ... 10-15 South KoreaOman ... ... ... 20 South KoreaSaudi Arabia ... ... ... 20 South KoreaTotal ... ... ... 110-115 ...

HonamAbu Dhabi ... 20 34 20 South KoreaIran ... ... ... 65 South KoreaMalaysia ... 15 17 12 South KoreaOman ... 20 22 20 South KoreaSaudi Arabia ... 30 30 30 South KoreaQatar ... ... ... 10 South KoreaTotal ... 85 103 157 ...

HuntMexico ... 5-10 8 5 USSaudi Arabia ... ... ... 12 USVenezuela ... 6 8 8 USTotal ... 11-16 16 25 ...

HyundaiAbu Dhabi ... ... ... 10 South KoreaIran ... ... ... 60 South KoreaSaudi Arabia ... ... ... 50 South KoreaTotal ... ... ... 120 ...

IdemitsuAbu Dhabi 50 60 60 40 JapanIran 20 30 30 50 JapanIraq 40 ... ... ... ...Kuwait 30 20 40 50 JapanMalaysia ... 5 5 5 JapanOman 40 30-40 30-40 35 JapanQatar ... 30 30 30 JapanSaudi Arabia ... 100 100 120 JapanVietnam ... 7 9 ... ...Total 180 282-292 304-314 330 ...

IncomedNigeria ... ... 30 30 East/West



Volume DestinationIndian Oil Corp. 1989 1992 1993 1995 in 1995Abu Dhabi 10 20 20 20 IndiaIran 20 60 60 60 IndiaIraq 70 ... ... ... ...Kuwait 10 80 80 90-100 IndiaMalaysia ... 30 30 10 IndiaSaudi Arabia 60 100 100 120 IndiaTotal 170 290 290 300-310 ...

IndonesiaIran 30 ... ... ... ...Iraq 30 ... ... ... ...Saudi Arabia ... 20 ... ... ...Total 60 20 ... ... ...

InpexIndonesia ... ... 30 ... ...

InterpetrolColombia ... 17 ... ... ...Ecuador ... ... 12 12 US/Latin AmericaNigeria ... 30 ... ... ...Total ... 47 12 12 ...

IPCONigeria ... ... ... 20 East/West

IPG (Kuwait)Yemen ... 10 ... 25 East

Irving OilSaudi Arabia ... 50 50 50 Canada

Isab GarroneIran ... 40-50 40-50 35 ItalySaudi Arabia 35 30-50 30 30 ItalySyria ... ... 16-25 15 ItalyTotal 35 70-100 86-106 80 ...

IsraelEgypt ... 40 ... ... ...Mexico ... 30 ... ... ...Total ... 70 ... ... ...

ITOCNigeria ... 10 ... ... ...

ItochuAbu Dhabi ... 10-20 10-20 ... ...Ecuador 15 ... ... ... ...Iran 40 30 25 30 JapanKuwait ... ... 10 ... ...Nigeria ... 30 30 20 East/WestOman ... 20 20 15 JapanQatar 30 50 50 50 JapanTotal 85 140-150 145-155 115 ...

Ivory CoastKuwait ... ... ... 25 Ivory Coast

Jaco RossiLibya ... 60 ... ... ...

JapanChina 165 190 180 ... ...Mexico 180 100 100 80 JapanTotal 345 290 280 80 ...



Volume DestinationJapan Energy Corp. 1989 1992 1993 1995 in 1995Kuwait ... ... ... 10 JapanSaudi Arabia 60 100 100 100 JapanVietnam ... ... 8 ... ...Total 60 100 108 110 ...

KanematsuAbu Dhabi 15 17 17 17 JapanIran 20 30 20 40 JapanQatar 15 ... ... ... ...Total 50 47 37 57 ...

KashimaIraq 10 ... ... ... ...Oman 10 12 12 10-15 JapanTotal 20 12 12 10-15 ...

KitcoIndonesia varies 45-50 ... ... ...

KochEgypt ... 5-7 ... ... ...Mexico ... 10 20 25 USVenezuela ... 15 15-25 10 USTotal ... 30-32 35-45 35 ...

KPI/KPCSaudi Arabia ... 75 ... ... ...

KukdongAbu Dhabi ... 10 10 ... ...Iran ... 25 25 ... ...Oman ... 10 ... ... ...Saudi Arabia ... 20 45 ... ...Total ... 65 80 ... ...

Kuo InternationalVietnam ... 7 10-20 ... ...

Kuwait Pet. Intl.Kuwait 130 90 90 ... ...

Kyung-InChina ... ... 20 ... ...Iran ... ... 20 ... ...Kuwait ... 20 20 ... ...Malaysia ... 10-15 21 ... ...Oman ... 15-20 32 ... ...Qatar ... 8 10 ... ...Saudi Arabia ... ... 20 ... ...Total ... 53-63 143 ... ...

KyushuAbu Dhabi ... ... ... 15 Japan

LebanonSyria ... 40 20 ... ...

Lion OilSaudi Arabia ... 25 ... 25 US

Lucky GoldstarEcuador 25 24 27 36 South Korea



Volume DestinationLyondell 1989 1992 1993 1995 in 1995Mexico 60 70 30 ... ...Nigeria 30 ... ... ... ...Saudi Arabia 50 50 ... ... ...Venezuela ... 1 100 130 USTotal 140 121 130 130 ...

MapcoNigeria 50 ... ... ... ...

MarathonIraq 35 ... ... ... ...Kuwait ... ... 0-30 50 USMexico 90 60 60 20-25 USSaudi Arabia 60 125 125 100 USTotal 185 185 185-215 150 ...

Marc RichEgypt ... 6-9 ... ... ...Iran 200 100-120 150-175 ... ...Nigeria ... 40 30 ... ...Ecuador ... 12 12 ... ...Syria ... ... 30-33 3 EuropeTotal 200 158-181 222-250 3 ...

MarimpexEgypt ... 4 ... ... ...Iran ... ... ... ... ...Libya ... 20 ... ... ...Total ... 24 ... ... ...

MarubeniAbu Dhabi ... ... ... 10 JapanIran 20 30 25 30 JapanMalaysia ... ... 3 3 JapanOman ... 10 10 10 JapanQatar 50 50 50 45 JapanVietnam ... 5 5 ... ...Total 70 95 93 98 ...

MetalchimNigeria ... 20 20 ... ...

Mindo/PertaminaSaudi Arabia ... ... ... 55 Indonesia

Mitsubishi Corp.Abu Dhabi ... 20 20 30 JapanIran 20 20 25 20 JapanIraq 20 ... ... ... ...Kuwait 20 20 20 ... ...Malaysia ... 5-10 8 8 JapanOman ... 17 17 10 JapanQatar 50 50 50 50 JapanSaudi Arabia 100 ... 58 60 JapanVietnam ... 25 27 ... ...Yemen ... ... ... 5 JapanTotal 210 157-162 225 183 ...

Mitsubishi OilAbu Dhabi 15 ... 20 20 JapanIran 10 15 15 ... ...Saudi Arabia ... 50 20 20 JapanTotal 25 65 55 40 ...



Volume DestinationMitsui 1989 1992 1993 1995 in 1995Abu Dhabi 10 10-15 10-15 ... ...Egypt ... 3 ... ... ...Iran 30 25 20 20-25 JapanKuwait 20 ... ... ... ...Oman ... 12 12 10-15 JapanQatar 20 ... ... 30 JapanVietnam ... 5 5 ... ...Total 80 55-60 47-52 60-70 ...

MobilAbu Dhabi ... 20 20-30 20-30 EastColombia ... ... 16 ... ...Egypt ... 4 ... ... ...Iran ... 40 25 40-50 EastMalaysia ... 10-15 ... ... ...Mexico 90 100 125 90 USOman 20 ... ... 10 EastQatar 25 25 25 25 EastSyria ... ... ... 10 EuropeVenezuela 40 35 30-100 130 USYemen ... 22 ... ... ...Saudi Arabia ... 375-425 375-425 300-350 East/WestTotal 175 631-686 616-746 625-695 ...

Moncrief OilNigeria ... ... ... 20 East/West

Motor Oil HellasEgypt ... 6 ... ... ...

MurphyColombia 15 17 16 ... ...Mexico 15 18 ... 15 USVenezuela ... ... ... 15 USTotal 30 35 16 30 ...

N. KoreaIran 40 10 ... ... ...

NesteAbu Dhabi ... 20 20 20 KenyaIran ... ... 0-40 ... ...Nigeria ... 40 40 ... ...Oman ... 20 20 ... ...Saudi Arabia 90 30 ... ... ...Nigeria ... 20 ... ... ...Total 90 130 80-120 20 ...

NichimenVietnam ... 2 ... ... ...

NigermedNigeria ... 30 30 ... ...

Nippon OilAbu Dhabi 20 40 40 30 JapanIran ... ... ... 30 JapanIraq 35 ... ... ... ...Malaysia ... 10-15 15 15 JapanOman 20 20 20 20 JapanQatar ... 10 10 10 Japan



Volume DestinationNippon Oil (cont.) 1989 1992 1993 1995 in 1995Saudi Arabia ... 50 70 100 JapanVietnam ... 5 ... ... ...Total 75 135-140 155 205 ...

Nissho IwaiOman ... ... 10 10 JapanVietnam ... 25 27 ... ...Iran 20 ... ... ... ...Total 20 25 37 10 ...

Nova (Canada)Libya ... ... ... 10 EuropeNigeria ... 20 20 20 East/WestTotal ... 20 20 30 ...

Nova (Greece)Iran ... ... 60 ... ...Libya ... 20-40 40 40 GreeceNigeria ... ... ... 20 East/WestTotal ... 20-40 100 60 ...

NynasVenezuela 30 24 25 ... ...

Nynas SwedenVenezuela ... ... ... 10 Sweden

Nynas UKVenezuela ... ... ... 30 UK

Oil TexEcuador ... 12 12 24 US/Latin America

OK PetroleumIran ... ... ... 30 SwedenNigeria ... 20 ... 20 SwedenSaudi Arabia ... ... ... 50 SwedenTotal ... 20 ... 100 ...

OMVEgypt ... 7-9 ... ... ...Iran ... 30 20-30 5-10 AustriaLibya 20 85-90 90 110 AustriaMexico 5 25 30 ... ...Syria ... 20 20 10 AustriaTotal 25 167-174 160-170 125-130 ...

Oranto (First Fuels)Nigeria ... ... ... 20 East/West

PakistanAbu Dhabi ... 10 10 10 PakistanIran ... 20 40 20 PakistanKuwait ... ... ... 50-70 PakistanQatar ... ... ... 10 PakistanSaudi Arabia ... 50 40 45 PakistanTotal ... 80 90 135-155 ...

PertaIndonesia varies 45-50 ... ... ...

Petro-CanadaMexico ... 15 15 10 Canada



Volume DestinationPetrobras 1989 1992 1993 1995 in 1995Ecuador 15 ... 12 ... ...Iran 60 180 75 60 BrazilIraq 150-200 ... ... ... ...Kuwait 30 ... ... 50 BrazilQatar 25 ... 25 20 BrazilSaudi Arabia 120 150-200 200 150 BrasilVenezuela ... ... ... 50 BrazilTotal 400-450 330-380 312 330 ...

PetrofinaAbu Dhabi ... 20-30 20 ... ...Iran ... 50-100 0-75 75 BelgiumKuwait ... ... ... 25 BelgiumMexico 20 30 ... 14 BelgiumSaudi Arabia ... 20 20 65 BelgiumTotal 20 120-180 40-105 179 ...

PetrogalIran ... ... ... 30 PortugalMexico 10 30 ... 13 PortugalSaudi Arabia ... ... ... 65 PortugalTotal 10 30 ... 108 ...

Petrogas (Glencore)Nigeria ... ... ... 30 East/West

PetrojamNigeria ... 20 20 ... ...

PetrolimpexSaudi Arabia ... 25 ... ... ...

PetromedMexico 40 20 ... ... ...Nigeria 70 ... ... ... ...Total 110 20 ... ... ...

PetronSaudi Arabia ... ... ... 150 Philippines

PetronasIran ... 15 ... ... ...

PetronorIran ... ... ... 30-40 SpainMexico 50 ... ... ... ...Total 50 ... ... 30-40 ...

PetroperuColombia ... ... 6 ... ...

PetrotrinColombia ... ... ... 16 TrinidadVenezuela ... ... ... 15 TrinidadTotal ... ... ... 31 ...

PhibroChina 40 25 ... ... ...Colombia 15 33 16-32 16 USEcuador ... ... 0-12 ... ...Egypt ... 5-7 ... ... ...Iran 175 30-50 0-80 ... ...Nigeria 60 ... 30 ... ...



Volume DestinationPhibro (cont.) 1989 1992 1993 1995 in 1995Saudi Arabia ... 15 ... ... ...Venezuela ... 1 0-75 45 USYemen ... ... ... 20 EastTotal 290 109-131 46-229 81 ...

PhillipsKuwait ... ... 0-30 17 USMexico ... ... ... 20 USSaudi Arabia 50 60 60 65-75 USVenezuela ... ... ... 30 USTotal 50 60 60-90 132-142 ...

PNOCChina ... 5 2 ... ...Iran ... 27 20 ... ...Kuwait ... ... 20 ... ...Malaysia ... 5-10 ... ... ...Saudi Arabia ... 60 60 ... ...Total ... 97-102 102 ... ...

PolandIran ... 60-72 50 ... ...Iraq 25 ... ... ... ...Total 25 60-72 50 ... ...

PTT (Thailand)Iran ... 15 ... ... ...Malaysia ... 15 5-10 10 ThailandOman ... 10 ... ... ...Total ... 40 5-10 10 ...

Queen PetroleumNigeria ... ... ... 20 East/West

RafironIran ... ... ... 65 Romania

Ragma OilNigeria ... ... ... 20 East/West

RD/ShellAbu Dhabi ... 67 67 20 EastIraq 50-100 ... ... ... ...Kuwait ... ... 180 100-150 East/WestLibya ... 20 20 ... ...Malaysia ... 5-10 ... ... ...Nigeria 50 30 ... ... ...Oman ... 40 40 50 EastVenezuela 30 23 23 15 EuropeVietnam ... 12 ... ... ...Yemen 10 ... ... ... ...Iran 70 50-70 70 50 East/WestSaudi Arabia 300 600 800 550-600 East/WestTotal 510-560 847-872 1200 785-885 ...

RepsolEgypt ... 3 ... ... ...Iran ... ... ... 30-35 SpainIraq 100 ... ... ... ...Kuwait ... ... 0-30 ... ...Libya 60 90 100 100 SpainMexico 100 190 160 85 Spain



Volume DestinationRepsol 1989 1992 1993 1995 in 1995Nigeria ... ... ... 40 SpainSaudi Arabia ... 30-50 100 100 SpainSyria ... ... ... 25 SpainTotal 260 313-333 360-390 380-385 ...

RheinoilSaudi Arabia 35 90 90 90 GermanySyria ... ... 6-12 20 GermanyTotal 35 90 96-102 110 ...

RomaniaEgypt ... 6 ... ... ...Iran ... 16 ... ... ...Total ... 22 ... ... ...

Ruhr OelVenezuela 150 200 200 ... ...

S. KoreaMexico ... 10 ... ... ...

SamudraIndonesia varies 15-20 ... ... ...

San Jose AccordMexico 45 53 50 ... ...Venezuela 45 53 50 ... ...Total 90 106 100 ... ...

SarasSaudi Arabia ... ... 35 ... ...Kuwait ... ... 30 20 ItalyTotal ... ... 65 20 ...

SasolKuwait ... ... ... 30 South Africa

Scandinavian TradingNigeria ... ... ... 20 East/West

ScanoilColombia 15 ... ... ... ...

SeibuKuwait ... ... 20 20 Japan

Shell CanadaMexico ... ... 4 3 Canada

Shell USKuwait ... 100 0-60 15 USMexico 65 60-70 80 120 USSaudi Arabia ... 50 50-80 30 USYemen 20 ... ... ... ...Total 85 210-220 130-220 165 ...

Showa ShellAbu Dhabi 10 20 20 30 JapanIran 20 25 25 30 JapanIraq 10 ... ... ... ...Malaysia ... ... 3 3 JapanTotal 40 45 48 63 ...

Singapore PetroleumMalaysia ... 5-10 ... ... ...



Volume DestinationSinochem 1989 1992 1993 1995 in 1995Iran ... 20 ... ... ...Malaysia ... ... ... 20 ChinaOman ... ... ... 20 ChinaSaudi Arabia ... 25 ... 30 ChinaVietnam ... 7 ... ... ...Libya ... ... ... ... ...Total ... 52 ... 70 ...

Smith & HollanderVenezuela ... 6 ... 5 UK

SocapSyria ... ... ... 3 Europe

Sonangol (Angola)Egypt ... 4 ... ... ...

SonatrachIran ... ... 60 ... ...

South Africa ¶Iran ... ... ... 200-250 South Africa

Southern PetroleumNigeria ... 40 30 ... ...

SRC ��Kuwait ... ... ... 30 Singapore

Sri LankaIran ... ... ... 20 Sri Lanka

SsangyongEcuador 25 ... ... ... ...Saudi Arabia ... 200 170-300 350 South KoreaTotal 25 200 170-300 350 ...

Star EnterpriseEgypt ... 10 ... ... ...Saudi Arabia 550 550 550 550 USVenezuela ... 42 50-60 40 USTotal 550 602 600-610 590 ...

SudanLibya ... 25 ... ... ...

SumitomoIran 20 15-20 20 40 JapanKuwait 20 20 ... ... ...Oman ... ... 10 10 JapanVietnam ... 3 14 ... ...Total 40 38-43 44 50 ...

SunColombia ... 17 16 16 USMexico ... 30 30 15-20 USNigeria 75 60 60 ... ...Saudi Arabia 50 50 50 75-80 USVenezuela 20 37 15-20 ... ...Total 145 194 171-176 106-116 ...

TaiyoMalaysia ... 15-20 15-20 20 JapanSaudi Arabia ... ... ... 50-60 JapanTotal ... 15-20 15-20 70-80 ...



Volume DestinationTamoil 1989 1992 1993 1995 in 1995Libya 100 240-280 250 250 Germany, Switzerland, Italy

TarmacVenezuela ... 30 ... ... ...

TevierEcuador ... ... 12 12 US/Latin AmericaNigeria ... ... 40 ... ...Total ... ... 52 12 ...

TexacoAbu Dhabi 10 ... ... ... ...Ecuador ... ... 12 12 US/Latin AmericaIraq 100-150 ... ... ... ...Kuwait ... ... ... 35 USMalaysia ... 10-15 ... ... ...Nigeria ... 30 30 ... ...Qatar ... 10 ... ... ...Saudi Arabia ... 80-100 80-100 80-100 East/WestSyria ... ... ... 20 EuropeVenezuela ... 18 10 35-40 USTotal 110-160 148-173 132-152 182-207 ...

Thai OilAbu Dhabi ... ... ... 16 Thailand

TogoNigeria ... ... ... 10 Togo

ToscoEcuador ... ... ... 12 US

Total (France)Abu Dhabi ... 17 17 ... ...Iraq varies ... ... ... ...Libya ... ... 20 10 FranceMexico 60 25 30 20 France/UKNigeria 80 ... ... 40 East/WestQatar ... ... 20 ... ...Saudi Arabia 50 50 50 90 France/South AfricaSyria ... 20 30-33 30 FranceIran ... 20 0-40 10-15 FranceTotal 190 132 167-210 200-205 ...

TotisaEcuador ... ... 12 12 US/Latin America

ToyomenkaIran 40 50 50-125 60-70 JapanNigeria ... ... ... 30 East/WestTotal 40 50 50-125 90-100 ...

TransworldOman 50 110 110 50 East

TrifineryVenezuela ... 9 15-20 15 US

TripetrolEcuador 15 48 12 36 US/Latin America

TuprasAbu Dhabi ... ... 48 ... ...Iran ... ... 60-80 100 Turkey



Volume DestinationTupras (cont.) 1989 1992 1993 1995 in 1995Libya ... 60 48 50 TurkeySaudi Arabia ... 160 160-180 176 TurkeySyria ... ... ... 20 TurkeyTotal ... 220 316-356 346 ...

UnocalYemen ... ... ... 20 East

Unoven §Venezuela ... 120 120 135 US

US SPRMexico 45 ... ... ... ...

VebaNigeria ... 30 30 ... ...Syria ... 20 30-33 35 GermanyVenezuela ... ... ... 40 GermanyTotal ... 50 60-63 75 ...

Vermont (Vitol)Nigeria ... ... ... 20 East/West

VitolIran 100 50-60 ... ... ...Nigeria ... ... ... 30 East/WestTotal 100 50-60 ... 30 ...

VTT VulcanNigeria ... ... ... 30 East/West

WicklandEcuador ... ... ... 12 US/Latin America

Wind Pemiy NVNigeria ... ... ... 30 East/West

WintershallNigeria ... ... ... 30 Germany

YugoslaviaIran 20 ... ... ... ...

YukongAbu Dhabi ... 17 35 20 South KoreaChina ... 20 10 ... ...Ecuador ... 24 24 24 South KoreaIran ... 70 70 70 South KoreaKuwait ... 20 60 70 South KoreaMalaysia ... 15-20 32 17 South KoreaOman ... ... 29 20 South KoreaQatar ... 10 10 10 South KoreaSaudi Arabia ... 50-100 80 80 South KoreaTotal ... 226-281 350 311 ...


Company/Origin 1991 1992 1993 1994 1995

Amerada HessAbu Dhabi ... 89 74 10 ...Algeria ... ... ... 5 17Angola ... 13 9 10 7Argentina ... 1 ... ... 4Colombia ... ... ... ... 3Congo ... 35 24 26 6Gabon ... 14 9 23 19Indonesia ... 2 ... 3 ...Kuwait ... ... 5 0.1 ...Nigeria ... 35 71 115 145Norway ... ... 3 11 3Saudi Arabia ... 47 28 59 81United Kingdom ... ... 1 38 15Zaire ... 1 ... 1 2Total ... 236 225 301 301

AmocoAlgeria ... ... ... ... 3Angola 3 ... ... 1 2Argentina ... ... ... 8 1Australia ... ... 3 3 ...Cameroon 2 2 ... ... ...Canada 118 137 139 143 169Colombia ... ... 8 14 38Congo 2 ... ... ... ...Ecuador ... ... ... 6 ...Gabon ... 1 ... ... 1Guatemala 3 5 6 5 9Indonesia ... ... ... 5 ...Kuwait 3 3 11 ... ...Malaysia 1 ... ... ... ...Mexico 64 75 71 68 70Nigeria 55 56 82 32 44Norway 10 1 ... 8 6Peru ... ... ... ... 2Russia ... ... ... 2 3Saudi Arabia 117 137 114 110 61Syria ... ... 10 1 ...Trinidad & Tobago 70 69 54 61 66United Kingdom 1 ... 1 7 18Venezuela 18 29 33 31 43Yemen ... ... 1 8 ...Total 467 515 533 512 536

ArcoEcuador ... ... ... ... 2

AshlandAngola ... ... 5 ... ...Canada 41 30 43 60 97Colombia ... ... ... ... 5Dubai ... ... 3 ... ...Kuwait ... ... 35 47 46Mexico ... ... ... ... 13Nigeria ... 8 4 1 ...

Ashland (cont.) 1991 1992 1993 1994 1995

Norway ... 7 3 1 ...Oman ... ... 3 1 3Russia ... ... ... 1 ...Saudi Arabia 142 138 80 82 57United Kingdom 4 ... 20 15 11Yemen ... ... ... 1 ...Total 187 183 197 210 233

AstraCanada ... 1 1 ... ...Malaysia ... ... 4 ... ...Thailand ... ... 2 ... ...UAE ... ... 1 ... ...Total ... 1 7 ... ...

Bayway Refining (Tosco)*Algeria ... ... 2 ... 5Angola ... ... 5 5 21Canada ... ... ... 4 ...China ... ... 7 22 28Colombia ... ... ... ... 8Gabon ... ... 26 43 40Mexico ... ... ... ... 4Nigeria ... ... 3 8 1Norway ... ... 56 101 115United Kingdom ... ... 12 13 22Total ... ... 111 197 245

BHPAustralia ... ... 3 11 16China ... ... ... ... 2Ecuador ... ... ... 2 ...Indonesia ... ... 6 28 25Malaysia ... ... 1 ... 2Oman ... ... ... ... 4Papua New Guinea ... ... ... 10 5Total ... ... 10 50 54

British PetroleumAngola 32 56 53 37 24Argentina ... 1 ... ... ...Australia 1 ... ... ... ...Canada 16 16 9 14 15Colombia 6 8 28 15 19Ecuador ... ... 2 ... ...Gabon 1 8 2 30 59Indonesia 2 1 2 ... ...Malaysia ... ... 2 ... ...Mexico ... ... ... 2 ...New Zealand ... ... 1 ... ...Nigeria 184 184 211 153 198Norway 12 21 9 14 5Papua New Guinea ... ... 2 ... ...Saudi Arabia ... ... ... 2 ...Thailand 2 3 1 ... ...United Kingdom ... 1 ... 5 6Venezuela ... ... ... 10 4

US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)

*Also see Tosco.


BP (cont.) 1991 1992 1993 1994 1995

Yemen 2 ... 2 ... ...Zaire 3 3 5 4 4Total 261 302 331 285 333

Caribbean GulfColombia ... 2 1 ... ...Ecuador ... 1 3 ... ...Venezuela ... 28 30 34 8Total ... 31 33 34 8

CenexCanada ... 18 22 25 30

ChevronAngola 67 68 68 50 ...Argentina ... 2 ... 2 1Australia ... 1 1 ... ...Canada 1 1 ... ... ...China 3 11 17 22 22Colombia ... ... 3 1 1Congo 1 13 4 3 ...Ecuador ... 7 1 26 7Egypt ... 3 7 2 7Gabon 1 18 18 10 ...Indonesia 46 43 34 46 37Italy 3 ... ... ... ...Kuwait ... 17 60 52 30Malaysia ... 3 2 ... 2Mexico 131 131 126 155 135Nigeria 89 81 128 61 1Norway ... ... ... 1 13Oman 2 4 6 19 5Russia ... ... 1 ... ...Saudi Arabia 214 172 160 155 176Singapore ... ... 1 ... ...Syria ... ... 1 1 ...UAE ... ... ... 2 ...United Kingdom 11 7 ... 13 4Venezuela 10 24 20 13 24Vietnam ... ... ... ... 1Yemen ... ... ... 4 ...Zaire 18 4 9 6 ...Total 597 609 668 643 465

CibroKuwait ... ... 1 ... ...Venezuela ... 4 2 ... ...Total ... 4 3 ... ...

CitgoArgentina ... ... ... 2 ...Angola ... ... ... ... 2Colombia ... ... ... ... 1Ecuador 1 1 ... 1 ...Mexico 47 60 66 55 31Nigeria ... ... ... ... 1Norway ... ... ... ... 1Peru ... ... ... ... 1

Citgo (cont.) 1991 1992 1993 1994 1995

United Kingdom 3 4 14 10 17Venezuela 152 294 309 307 348Total 203 359 389 375 404

ClarendonArgentina ... 1 ... ... ...Ecuador ... ... 1 ... ...Indonesia ... 2 ... ... ...Total ... 3 1 ... ...

ClarkAngola ... 1 ... ... 21Argentina ... ... ... ... 1Canada 52 56 52 49 36Colombia ... ... ... 1 4Congo ... ... ... 1 1Ecuador ... 2 2 1 14Egypt ... ... 1 ... ...Gabon ... ... 3 ... 15Indonesia ... ... ... 2 ...Kuwait ... ... 1 ... ...Mexico 34 30 32 25 45Nigeria ... ... 5 18 22Norway 2 7 3 ... 8Russia 2 1 3 1 3Saudi Arabia 1 ... ... ... ...Syria 1 ... ... ... ...Trinidad & Tobago 1 1 ... ... ...UAE ... ... ... ... 0United Kingdom 8 6 ... 4 19Venezuela 1 ... ... 9 22Yemen 3 ... ... ... ...Zaire ... ... ... ... 2Total 99 107 102 112 215

CoastalAngola 23 61 73 44 52Argentina ... 1 ... ... ...Australia 1 ... ... ... ...Canada ... 1 ... ... 2China 19 8 5 ... ...Colombia ... 1 2 1 3Ecuador 8 6 2 ... ...Egypt ... ... 2 2 ...Gabon 39 29 29 36 53Indonesia 10 1 ... 6 ...Malaysia 4 ... ... 2 ...Mexico 34 29 36 31 43Nigeria ... ... ... 25 26Norway ... ... 4 ... 2Russia ... ... ... 3 ...Saudi Arabia ... 11 1 ... ...Trinidad & Tobago ... 1 ... ... ...United Kingdom ... ... ... ... 7Venezuela 22 33 30 42 51Yemen 3 ... ... ... ...Zaire 1 2 2 3 1Total 163 182 187 193 240



ColoradoCanada ... ... ... 2 0.1

ConocoAngola ... ... ... 3 ...Canada 42 37 45 53 60Colombia 1 8 7 ... 3Ecuador ... 1 1 2 4Egypt ... ... 1 ... ...Mexico 31 36 54 82 72Nigeria 7 ... 2 ... ...Peru ... ... ... ... 13Saudi Arabia ... ... 1 ... ...Syria ... ... 2 ... ...Trinidad & Tobago ... ... 1 1 ...United Kingdom ... ... 3 ... 0.3Venezuela 76 67 44 44 41Total 157 149 161 184 193

CrownAlgeria 1 ... 1 2 ...Angola 18 20 16 15 11Argentina ... 1 1 1 5Australia ... ... 1 ... ...Benin ... ... 2 ... ...Canada ... 1 2 ... ...Colombia 2 ... 6 ... 2Malaysia ... ... ... 0.2 ...Nigeria 6 1 2 2 9Norway 5 6 4 7 10Oman ... ... 3 3 ...Papua New Guinea ... ... ... 2 ...Syria 1 ... ... ... ...Tunisia ... 2 ... ... ...United Kingdom 17 18 23 18 22Yemen ... ... ... 1 ...Zaire ... 4 ... ... 3Total 50 52 60 50 62

Deer Park Refining Partnership*Algeria ... ... ... 6 3Cameroon ... ... ... ... 2Colombia ... ... ... ... 3Ecuador ... ... ... ... 2Indonesia ... ... ... 0.4 ...Kuwait ... ... ... 13 ...Malaysia ... ... ... 2 ...Mexico ... ... ... 28 129New Zealand ... ... ... 1 ...Nigeria ... ... ... 33 6Norway ... ... ... 1 ...Saudi Arabia ... ... ... 27 5Spain ... ... ... ... 1UAE ... ... ... 1 ...United Kingdom ... ... ... 4 ...Venezeula ... ... ... ... 1Total ... ... ... 115.6 151.3

D. Shamrock 1991 1992 1993 1994 1995

Angola 4 ... ... ... 1Canada ... ... ... 1 ...Colombia ... ... ... ... 3Indonesia ... ... ... 0.2 ...Malaysia ... ... ... 1 ...Nigeria ... ... ... 8 1Norway 13 1 13 3 42Papua New Guinea ... ... ... 0.2 ...Thailand ... ... 1 ... ...United Kingdom 2 25 29 51 24Total 18 26 43 63 72

EnronCanada ... 3 3 ... ...Ecuador ... 1 ... ... ...Mexico ... ... 1 ... ...United Kingdom ... ... 1 ... ...Total ... 4 6 ... ...

ErgonVenezuela ... 12 21 21 19

ExxonAngola 33 12 8 13 20Argentina 1 3 4 10 27Australia 2 ... ... ... ...Benin ... ... ... 1 2Cameroon 1 4 ... ... ...Canada 19 15 16 21 25China 7 24 1 ... ...Colombia 5 1 14 44 58Congo ... 3 ... ... 12Dubai ... ... 4 ... ...Ecuador ... ... ... 1 2Egypt ... ... 15 3 ...Gabon 10 24 26 14 18Guatemala 1 ... ... ... ...Indonesia 1 2 ... 1 ...Kuwait ... 17 104 102 69Mexico 33 27 43 56 99Nigeria ... 15 3 ... ...Norway 3 49 11 4 2Oman ... ... 2 4 ...Russia ... ... 5 7 2Saudi Arabia 237 188 94 117 145Syria ... ... 1 ... ...UAE ... ... ... 3 ...United Kingdom ... 1 3 15 11Venezuela 18 13 3 4 3Yemen ... ... 1 1 ...Zaire 1 ... ... ... 2Total 373 397 360 422 495

FarmlandCongo ... ... 1 1 3

FinaAngola ... ... 2 ... ...

*Shell Oil and Pemex.



Fina (cont.) 1991 1992 1993 1994 1995

Argentina ... 1 ... 1 ...Australia ... 2 ... ... ...Colombia 3 6 4 1 5Ecuador 4 ... ... ... ...Egypt ... ... 3 ... ...Indonesia ... 3 ... ... ...Kuwait 1 1 23 25 18Mexico 21 24 38 34 45Nigeria ... 8 10 5 ...Norway ... 1 1 ... 3Oman 2 ... ... ... ...Russia ... 1 3 ... ...Saudi Arabia 44 19 ... ... ...United Kingdom 11 16 14 45 52Yemen 3 ... ... ... ...Total 89 83 99 112 122

FrontierCanada ... ... ... ... 0.3

Golden WestEcuador ... 1 ... ... ...

HuntEcuador ... ... ... ... 1Mexico 6 8 9 7 8Saudi Arabia 4 7 8 8 3Venezuela 7 7 8 7 10Total 17 22 24 22 22

Indian RefiningAngola ... ... 5 ... ...Canada ... ... ... 14 3Ecuador ... ... 7 2 ...Nigeria ... ... ... 10 ...Norway ... ... ... 3 ...Russia ... ... ... 3 ...United Kingdom ... ... ... 1 ...Total ... ... 12 32 3

Kerr-McGeeAbu Dhabi ... ... 1 ... ...Algeria 1 1 4 ... ...Angola 18 23 16 ... ...Argentina ... 2 ... ... ...Australia ... ... 1 ... ...Colombia 21 3 3 ... ...Denmark ... ... 1 ... ...Indonesia ... 2 ... ... ...New Zealand ... ... 1 ... ...Nigeria 1 1 4 ... ...Norway ... 3 ... ... ...Thailand ... 1 1 ... ...United Kingdom 20 14 12 ... ...Zaire ... 2 ... ... ...Total 61 53 44 ... ...

Intercontinental TermAlgeria ... ... ... ... 3Nigeria ... ... ... ... 1

Int. Term (cont.) 1991 1992 1993 1994 1995

Saudi Arabia ... ... ... ... 1UAE ... ... ... ... 1Total ... ... ... ... 6

KochAlgeria 1 ... ... ... ...Angola ... 9 4 4 11Argentina 1 ... ... ... 1Bolivia ... ... ... ... 1Cameroon ... ... ... 2 ...Canada 158 151 175 167 191Colombia ... 1 3 13 8Dubai ... ... ... 2 2Ecuador ... ... ... ... 3Indonesia 1 ... ... 0.4 1Malaysia ... ... ... ... 2Mexico 8 18 27 35 28Nigeria 7 ... 3 37 45Norway ... ... ... 6 7Papua New Guinea ... ... 2 2 ...Singapore ... ... ... ... 1Saudi Arabia 3 ... ... ... ...Syria ... ... 3 ... ...Thailand ... ... ... 2 1United Kingdom 1 22 22 17 32Venezuela 7 13 18 10 10Yemen ... ... ... 7 3Zaire ... ... ... ... 1Total 188 214 257 303 346La GloriaAngola ... ... ... ... 1Colombia ... ... ... 1 ...Malaysia ... ... ... 1 ...Nigeria ... ... ... ... 1United Kingdom ... ... ... 1 4Yemen ... ... ... 0.3 ...Total ... ... ... 3 7Laketon RefiningCanada ... 4 ... ... ...LionSaudi Arabia ... 23 26 33 31Louisiana Land & ExplorationAngola ... ... ... ... 1Brazil ... ... ... 1 ...Canada ... 5 10 5 3Chile ... ... ... ... 1Colombia ... ... ... ... 1Ecuador ... ... ... ... 2Indonesia ... ... 1 ... ...Nigeria ... ... ... 3 ...UAE ... ... ... ... 1United Kingdom ... ... ... ... 3Total ... 5 11 9 12

LyondellAngola 6 12 3 4 3Argentina ... 5 ... ... ...



Lyondell (cont.) 1991 1992 1993 1994 1995

Colombia 1 ... 6 20 4Ecuador 5 ... 2 ... 3Indonesia ... ... ... 1 ...Mexico 82 53 31 4 ...Nigeria 1 ... ... 1 7Russia ... 1 ... ... ...Saudi Arabia 62 41 ... ... ...Thailand ... ... ... 1 ...United Kingdom 2 3 ... 1 11Venezuela 7 29 134 119 161Zaire ... ... 1 ... ...Total 166 144 176 151 189

MarathonAngola ... ... 5 23 16Argentina ... 1 ... ... ...Canada 14 18 15 20 22Colombia ... 3 ... ... 5Congo ... ... 7 1 3Egypt ... 4 4 ... ...Kuwait ... 1 50 51 56Mexico 57 60 47 30 24Nigeria 3 ... 3 3 10Norway 1 9 7 ... ...Peru ... ... ... ... 1Russia ... ... 6 7 5Saudi Arabia 141 137 110 91 111United Kingdom 2 10 26 31 5Venezuela ... ... ... 12 9Total 218 243 281 267 266MetallgesellschaftAngola ... 1 ... ... ...Canada 1 1 ... ... ...Colombia 1 1 ... ... ...Ecuador ... ... 7 ... ...Nigeria ... 5 ... ... ...United Kingdom 3 3 ... ... ...Total 4 10 7 ... ...MobilAngola 3 3 ... ... 2Benin 4 1 ... ... ...Canada 103 116 143 175 174Colombia 22 16 ... ... 3Ecuador 15 10 1 7 11Egypt ... 3 9 17 13Gabon 2 1 3 1 1Guatemala 1 ... ... ... ...Kuwait 1 ... 1 ... ...Mexico 104 131 155 170 224Nigeria ... 8 31 19 39Norway 4 ... ... ... 1Peru 1 ... ... ... 1Russia ... 2 7 3 ...Saudi Arabia 59 53 41 59 90

Mobil (cont.) 1991 1992 1993 1994 1995

United Kingdom 1 3 ... ... 3Venezuela 37 59 118 121 119Zaire 1 ... ... ... ...Total 356 407 510 572 679

Montana RefiningCanada ... 5 5 4 6MurphyAngola 1 4 7 7 13Argentina ... 5 3 ... ...Canada 6 6 7 15 33Colombia 21 15 12 13 14Ecuador ... ... ... ... 4Mexico 18 1 5 18 21Nigeria 2 2 4 ... 2Norway ... 3 1 ... ...Oman ... ... ... ... 2Saudi Arabia ... 1 ... ... ...United Kingdom 1 7 8 6 ...Venezuela ... ... ... 14 35Total 50 45 47 72 124

NesteVenezuela ... ... ... ... 22

North RidgeCanada ... 2 3 ... ...

Northeast PetroUnited Kingdom ... 1 ... ... ...

Oiltanking HoustonColombia ... ... ... 1 7Ecuador ... ... ... 1 6Kuwait ... ... ... ... 3Saudi Arabia ... ... ... 1 ...United Kingdom ... ... ... 3 ...Venezuela ... ... ... 12 16Total ... ... ... 18 31

Pacific RefiningAustralia ... 1 ... ... ...Canada ... ... 2 ... 0.3Colombia ... ... 3 ... ...Indonesia ... ... ... 1 ...Malaysia ... 1 ... ... ...Total ... 2 6 1 0.3

Pacific Resources*Australia 12 5 4 ... ...China 2 9 2 ... ...Ecuador 2 2 2 ... ...Guinea ... 2 ... ... ...Indonesia 19 15 18 ... ...Malaysia 10 5 ... ... ...Oman ... ... 1 ... ...Papua New Guinea ... ... 2 ... ...Total 46 37 29 ... ...

*See BHP for 1994-95.



Peerless 1991 1992 1993 1994 1995Algeria ... 3 1 ... ...

PhibroAngola 32 47 40 45 53Argentina 1 ... ... 2 1Australia 1 ... 2 ... ...Benin ... ... 1 ... ...Cameroon ... ... 2 ... ...Canada ... ... ... 1 ...China 34 10 ... 1 ...Colombia 32 29 33 9 9Congo 5 1 9 1 4Ecuador ... 1 2 3 4Egypt ... 2 1 ... 1Gabon 32 41 43 55 50Indonesia 5 3 3 1 ...Malaysia 3 ... ... ... ...Mexico ... ... ... 2 4Nigeria 7 4 3 2 ...Norway ... ... ... 5 2Papua New Guinea ... ... 5 ... ...Peru ... 1 ... ... ...Russia 1 ... 8 1 1Saudi Arabia 15 12 1 ... ...Syria 3 ... ... ... ...Trinidad & Tobago 1 ... ... 0.3 ...UAE ... ... 4 ... ...United Kingdom ... ... ... 1 ...Venezuela 7 25 40 34 59Zaire 1 2 2 ... 2Total 180 178 199 164 190

PhillipsAngola 9 4 1 4 6Argentina ... 1 2 5 ...Cameroon ... ... 5 ... ...Congo 22 26 29 21 ...Egypt ... ... 1 ... ...Kuwait ... ... 19 15 2Mexico ... ... ... 21 9Nigeria 17 22 25 32 56Norway 23 ... 4 11 20Oman ... ... ... 1 ...Saudi Arabia 41 64 52 70 75United Kingdom 4 7 7 3 14Venezuela ... ... ... 25 40Yemen ... ... 3 ... ...Zaire 1 ... ... ... ...Total 117 125 148 207 220

PowerineEcuador ... ... ... 15 14

SeaviewVenezuela ... 3 ... ... ...

ShellAlgeria 38 22 16 10 16Angola 5 12 ... 5 ...Australia 3 7 4 2 2

Shell (cont.) 1991 1992 1993 1994 1995

Cameroon 6 2 ... 2 ...Canada 2 14 48 53 70China ... ... ... ... 1Colombia 1 ... ... ... ...Ecuador 4 ... ... 2 ...Indonesia 1 ... 1 ... ...Kuwait ... ... 35 ... ...Malaysia 2 ... 1 2 ...Mexico 72 82 110 91 80New Zealand ... ... 1 ... ...Nigeria 117 142 105 63 39Norway ... ... ... 1 ...Oman ... ... 6 1 ...Papua New Guinea ... ... ... 4 ...Saudi Arabia 59 48 51 3 15Spain ... ... ... ... 0.4Thailand ... ... 1 2 ...UAE ... ... ... 2 1United Kingdom ... 4 16 6 ...Venezuela 1 ... ... ... ...Yemen 5 ... ... ... ...Total 318 333 393 247 224

SinclairCanada ... ... ... 12 12Venezuela ... ... ... 4 3Total ... ... ... 16 15

Sound RefiningIndonesia ... ... ... 0.1 ...Venezuela ... 2 2 3 2Total ... ... ... 3 2

Southwestern RefiningAlgeria ... ... ... 3 ...Angola ... ... ... 19 16Colombia ... ... ... 7 8Nigeria ... ... ... 13 5Norway ... ... ... 6 ...Thailand ... ... ... 3 ...United Kingdom ... ... ... 10 7Total ... ... ... 60 36

Star EnterpriseEcuador ... ... ... 2 2Egypt 17 21 21 25 13Gabon ... ... ... 3 5Kuwait ... ... 1 3 6Mexico ... ... 3 4 22Nigeria ... ... ... ... 3Oman ... ... ... 1 ...Saudi Arabia 520 496 493 463 514United Kingdom ... ... 1 4 ...Venezuela 36 52 50 42 49Total 573 569 569 547 614

Strategic Petroleum ReserveAngola ... ... 3 ... ...Argentina ... ... 1 ... ...Norway ... 6 3 ... ...



SPR (cont.) 1991 1992 1993 1994 1995

United Kingdom ... 4 8 12 ...Total ... 10 15 12 ...SunAngola ... ... 5 42 105Canada 52 63 57 54 68Colombia 7 32 22 17 12Denmark ... ... ... 2 ...Ecuador ... 14 20 6 16Gabon ... 3 ... 3 5Mexico 20 31 26 31 15Nigeria 187 128 92 95 146Norway ... 6 ... 18 45Oman ... ... 1 1 ...Saudi Arabia 44 53 44 78 86United Kingdom 14 41 91 115 94Venezuela 13 19 16 ... 15Yemen ... ... ... ... 2Zaire ... ... ... 2 1Total 336 390 376 464 610TesoroAustralia ... 1 ... ... ...

TexacoArgentina ... ... ... 1 ...Canada 1 8 15 15 22China ... 2 ... 1 2Colombia ... ... 4 1 4Ecuador 1 ... 3 8 10Indonesia ... ... ... 1 3Kuwait ... ... ... ... 2Malaysia ... 1 ... ... ...Peru ... ... ... ... 5Saudi Arabia 1 ... ... ... ...United Kingdom ... ... ... 11 ...Venezuela 14 12 12 16 18Total 17 23 35 55 65

ThriftyEcuador 4 1 ... ... ...Malaysia 1 ... ... ... ...Total 5 1 ... ... ...

Tosco*Argentina ... 1 ... 2 6Canada 8 ... ... ... 4Chile ... ... ... 4 4China ... ... ... 1 ...Colombia ... ... ... 1 1Ecuador 2 16 9 3 7Indonesia ... ... ... 0.4 ...Mexico 1 ... ... ... ...Oman ... ... 8 14 5Venezuela ... ... ... 1 ...Total 10 17 18 27 27

Total 1991 1992 1993 1994 1995

Canada ... 9 11 11 7Colombia ... ... 1 ... 3Ecuador ... ... ... 5 6Saudi Arabia ... ... ... 1 ...Total ... 9 12 17 17

TrifineryVenezuela ... 12 16 19 ...

Tx PetrochemSaudi Arabia ... ... ... 1 ...

UltramarMexico ... 1 ... ... ...

United RefiningCanada ... 60 60 61 68

UnovenCanada ... 17 13 3 17Venezuela ... 121 121 118 131Total ... 138 134 120 148

UnocalAustralia 1 ... ... ... ...Canada ... 1 ... ... ...Indonesia 8 ... ... ... ...Malaysia 2 ... ... ... ...Mexico ... ... 2 ... ...Philippines ... 1 ... ... ...Thailand 1 ... ... 1 ...Total 11 2 2 1 ...

US Oil & RefiningCanada ... 3 3 3 3Thailand ... ... ... 0.2 ...Venezuela ... 1 ... ... ...Total ... 4 3 3 3

ValeroAngola ... 1 9 4 15Argentina ... ... ... ... 2China ... 21 18 17 2Gabon ... ... ... ... 1Indonesia ... ... ... ... 1Nigeria ... ... ... ... 1Total ... 22 27 21 22

WicklandEcuador ... 5 21 ... ...Argentina ... ... ... 0.2 ...Total ... 5 21 0.2 ...

Wyoming RefiningCanada ... ... ... ... 0.2

Grand Total 5,338 6,399 7,043 7,469 8,217

Note: May not add due to rounding.

*See also Bayway Refining.



Origin/Company 1991 1992 1993 1994 1995

Abu DhabiAmerada Hess ... 89 74 10 ...Kerr-McGee ... ... 1 ... ...Total ... 89 75 10 ...

AlgeriaAmerada Hess ... ... ... 5 17Amoco ... ... ... ... 3Bayway Ref.* ... ... 2 ... 5Crown 1 ... 1 2 ...Deer Park Ref. � ... ... ... 6 3Intercont. Term ... ... ... ... 3Kerr-McGee 1 1 4 ... ...Koch 1 ... ... ... ...Peerless ... 3 1 ... ...Shell 38 22 16 10 16SW Refining ... ... ... 3 ...Total 41 26 24 26 47

AngolaAmerada Hess ... 13 9 10 7Amoco 3 ... ... 1 2Ashland ... ... 5 ... ...Bayway Ref.* ... ... 5 5 21British Petroleum 32 56 53 37 24Chevron 67 68 68 50 ...Citgo ... ... ... ... 2Clark ... 1 ... ... 21Coastal 23 61 73 44 52Conoco ... ... ... 3 ...Crown 18 20 16 15 11D. Shamrock 4 ... ... ... 1Exxon 33 12 8 13 20Fina ... ... 2 ... ...Indian Refining ... ... 5 ... ...Kerr-McGee 18 23 16 ... ...Koch ... 9 4 4 11La Gloria ... ... ... ... 1LL&E ... ... ... ... 1Lyondell 6 12 3 4 3Marathon ... ... 5 23 16Metallgesellschaft ... 1 ... ... ...Mobil 3 3 ... ... 2Murphy 1 4 7 7 13Phibro 32 47 40 45 53Phillips 9 4 1 4 6Shell 5 12 ... 5 ...SW Refining ... ... ... 19 16Strategic Pet. Res. ... ... 3 ... ...Sun ... ... 5 42 105Valero ... 1 9 4 15Total 254 347 337 335 403

ArgentinaAmerada Hess ... 1 ... ... 4Amoco ... ... ... 8 1

Argentina (cont.)1991 1992 1993 1994 1995

British Petroleum ... 1 ... ... ...Chevron ... 2 ... 2 1Citgo ... ... ... 2 ...Clarendon ... 1 ... ... ...Clark ... ... ... ... 1Coastal ... 1 ... ... ...Crown ... 1 1 1 5Exxon 1 3 4 10 27Fina ... 1 ... 1 ...Kerr-McGee ... 2 ... ... ...Koch 1 ... ... ... 1Lyondell ... 5 ... ... ...Marathon ... 1 ... ... ...Murphy ... 5 3 ... ...Phibro 1 ... ... 2 1Phillips ... 1 2 5 ...Strategic Pet. Res. ... ... 1 ... ...Texaco ... ... ... 1 ...Tosco � ... 1 ... 2 6Valero ... ... ... ... 2Wickland ... ... ... 0.2 ...Total 3 26 11 34 49

AustraliaAmoco ... ... 3 3 ...BHP § ... ... 3 11 16British Petroleum 1 ... ... ... ...Chevron ... 1 1 ... ...Coastal 1 ... ... ... ...Crown ... ... 1 ... ...Exxon 2 ... ... ... ...Fina ... 2 ... ... ...Kerr-McGee ... ... 1 ... ...Pacific Refining ... 1 ... ... ...Pacific Res. ¶ 12 5 4 ... ...Phibro 1 ... 2 ... ...Shell 3 7 4 2 2Tesoro ... 1 ... ... ...Unocal 1 ... ... ... ...Total 21 17 19 16 18

BeninCrown ... ... 2 ... ...Exxon ... ... ... 1 2Mobil 4 1 ... ... ...Phibro ... ... 1 ... ...Total 4 1 3 1 2

BoliviaKoch ... ... ... ... 1

BrazilLL&E ... ... ... 1 ...

CameroonAmoco 2 2 ... ... ...Deer Park Ref. � ... ... ... ... 2

US CRUDE OIL IMPORTS BY COUNTRY OF ORIGIN AND COMPANY, 1991-95 (In 1,000 b/d)

*See also Tosco. � See also Bayway Refining. � Joint venture between Shell and Pemex. § Formerly Pacific Resources. ¶ Now BHP.


Cameroon (cont.) 1991 1992 1993 1994 1995

Exxon 1 4 ... ... ...Koch ... ... ... 2 ...Phibro ... ... 2 ... ...Phillips ... ... 5 ... ...Shell 6 2 ... 2 ...Total 9 8 7 4 2

CanadaAmoco 118 137 139 143 169Ashland 41 30 43 60 97Astra ... 1 1 ... ...Bayway Ref.* ... ... ... 4 ...British Petroleum 16 16 9 14 15Cenex ... 18 22 25 30Chevron 1 1 ... ... ...Clark 52 56 52 49 36Coastal ... 1 ... ... 2Colorado ... ... ... 2 0.1Conoco 42 37 45 53 60Crown ... 1 2 ... ...D. Shamrock ... ... ... 1 ...Enron ... 3 3 ... ...Exxon 19 15 16 21 25Frontier ... ... ... ... 0.3Indian Refining ... ... ... 14 3Koch 158 151 175 167 191Laketon Refining ... 4 ... ... ...LL&E ... 5 10 5 3Marathon 14 18 15 20 22Metallgesellschaft 1 1 ... ... ...Mobil 103 116 143 175 174Montana Refining ... 5 5 4 6Murphy 6 6 7 15 33North Ridge ... 2 3 ... ...Pacific Refining ... ... 2 ... 0.3Phibro ... ... ... 1 ...Shell 2 14 48 53 70Sinclair ... ... ... 12 12Sun 52 63 57 54 68Texaco 1 8 15 15 22Tosco � 8 ... ... ... 4Total (France) ... 9 11 11 7United Refining ... 60 60 61 68Unocal ... 1 ... ... ...Unoven ... 17 13 3 17US Oil & Refining ... 3 3 3 3Wyoming Refining ... ... ... ... 0.2Total 634 799 899 985 1,137

ChileLL&E ... ... ... ... 1Tosco � ... ... ... 4 4Total ... ... ... 4 5

ChinaBayway Ref.* ... ... 7 22 28

China (cont.) 1991 1992 1993 1994 1995

BHP § ... ... ... ... 2Chevron 3 11 17 22 22Coastal 19 8 5 ... ...Exxon 7 24 1 ... ...Pacific Res. ¶ 2 9 2 ... ...Phibro 34 10 ... 1 ...Shell ... ... ... ... 1Texaco ... 2 ... 1 2Tosco � ... ... ... 1 ...Valero ... 21 18 17 2Total 65 85 50 64 57

ColombiaAmerada Hess ... ... ... ... 3Amoco ... ... 8 14 38Ashland ... ... ... ... 5Bayway Ref.* ... ... ... ... 8British Petroleum 6 8 28 15 19Caribbean Gulf ... 2 1 ... ...Chevron ... ... 3 1 1Citgo ... ... ... ... 1Clark ... ... ... 1 4Coastal ... 1 2 1 3Conoco 1 8 7 ... 3Crown 2 ... 6 ... 2Deer Park Ref. � ... ... ... ... 3D. Shamrock ... ... ... ... 3Exxon 5 1 14 44 58Fina 3 6 4 1 5Kerr-McGee 21 3 3 ... ...Koch ... 1 3 13 8La Gloria ... ... ... 1 ...LL&E ... ... ... ... 1Lyondell 1 ... 6 20 4Marathon ... 3 ... ... 5Metallgesellschaft 1 1 ... ... ...Mobil 22 16 ... ... 3Murphy 21 15 12 13 14Oiltanking Houston ... ... ... 1 7Pacific Refining ... ... 3 ... ...Phibro 32 29 33 9 9Shell 1 ... ... ... ...SW Refining ... ... ... 7 8Sun 7 32 22 17 12Texaco ... ... 4 1 4Tosco � ... ... ... 1 1Total (France) ... ... 1 ... 3Total 123 126 160 160 235

CongoAmerada Hess ... 35 24 26 6Amoco 2 ... ... ... ...Chevron 1 13 4 3 ...Clark ... ... ... 1 1Exxon ... 3 ... ... 12




Congo (cont.) 1991 1992 1993 1994 1995

Farmland ... ... 1 1 3Marathon ... ... 7 1 3Phibro 5 1 9 1 4Phillips 22 26 29 21 ...Total 30 78 74 54 29

DenmarkKerr-McGee ... ... 1 ... ...Sun ... ... ... 2 ...Total ... ... 1 2 ...

DubaiAshland ... ... 3 ... ...Exxon ... ... 4 ... ...Koch ... ... ... 2 2Total ... ... 7 2 2

EcuadorAmoco ... ... ... 6 ...Arco ... ... ... ... 2BHP § ... ... ... 2 ...British Petroleum ... ... 2 ... ...Caribbean Gulf ... 1 3 ... ...Chevron ... 7 1 26 7Citgo 1 1 ... 1 ...Clarendon ... ... 1 ... ...Clark ... 2 2 1 14Coastal 8 6 2 ... ...Conoco ... 1 1 2 4Deer Park Ref. � ... ... ... ... 2Enron ... 1 ... ... ...Exxon ... ... ... 1 2Fina 4 ... ... ... ...Golden West ... 1 ... ... ...Hunt ... ... ... ... 1Indian Refining ... ... 7 2 ...Koch ... ... ... ... 3LL&E ... ... ... ... 2Lyondell 5 ... 2 ... 3Metallgesellschaft ... ... 7 ... ...Mobil 15 10 1 7 11Murphy ... ... ... ... 4Oiltanking Houston ... ... ... 1 6Pacific Res. ¶ 2 2 2 ... ...Phibro ... 1 2 3 4Powerine ... ... ... 15 14Shell 4 ... ... 2 ...Star Enterprise ... ... ... 2 2Sun ... 14 20 6 16Texaco 1 ... 3 8 10Thrifty 4 1 ... ... ...Tosco � 2 16 9 3 7Total (France) ... ... ... 5 6Wickland ... 5 21 ... ...Total 46 69 86 93 120

Egypt 1991 1992 1993 1994 1995

Chevron ... 3 7 2 7Clark ... ... 1 ... ...Coastal ... ... 2 2 ...Conoco ... ... 1 ... ...Exxon ... ... 15 3 ...Fina ... ... 3 ... ...Marathon ... 4 4 ... ...Mobil ... 3 9 17 13Phibro ... 2 1 ... 1Phillips ... ... 1 ... ...Star Enterprise 17 21 21 25 13Total 17 33 65 49 34

GabonAmerada Hess ... 14 9 23 19Amoco ... 1 ... ... 1Bayway Ref.* ... ... 26 43 40British Petroleum 1 8 2 30 59Chevron 1 18 18 10 ...Clark ... ... 3 ... 15Coastal 39 29 29 36 53Exxon 10 24 26 14 18Mobil 2 1 3 1 1Phibro 32 41 43 55 50Star Enterprise ... ... ... 3 5Sun ... 3 ... 3 5Valero ... ... ... ... 1Total 85 139 159 218 267

GuatemalaAmoco 3 5 6 5 9Exxon 1 ... ... ... ...Mobil 1 ... ... ... ...Total 5 5 6 5 9

GuineaPacific Res. ¶ ... 2 ... ... ...

IndonesiaAmerada Hess ... 2 ... 3 ...Amoco ... ... ... 5 ...BHP § ... ... 6 28 25British Petroleum 2 1 2 ... ...Chevron 46 43 34 46 37Clarendon ... 2 ... ... ...Clark ... ... ... 2 ...Coastal 10 1 ... 6 ...Deer Park Ref. � ... ... ... 0.4 ...D. Shamrock ... ... ... 0.2 ...Exxon 1 2 ... 1 ...Fina ... 3 ... ... ...Kerr-McGee ... 2 ... ... ...Koch 1 ... ... 0.4 1LL&E ... ... 1 ... ...Lyondell ... ... ... 1 ...




Indonesia (cont.)1991 1992 1993 1994 1995

Pacific Refining ... ... ... 1 ...Pacific Res. ¶ 19 15 18 ... ...Phibro 5 3 3 1 ...Shell 1 ... 1 ... ...Sound Refining ... ... ... 0.1 ...Texaco ... ... ... 1 3Tosco � ... ... ... 0.4 ...Unocal 8 ... ... ... ...Valero ... ... ... ... 1Total 93 74 65 97 67

ItalyChevron 3 ... ... ... ...

KuwaitAmerada Hess ... ... 5 0.1 ...Amoco 3 3 11 ... ...Ashland ... ... 35 47 46Chevron ... 17 60 52 30Cibro ... ... 1 ... ...Clark ... ... 1 ... ...Deer Park Ref. � ... ... ... 13 ...Exxon ... 17 104 102 69Fina 1 1 23 25 18Marathon ... 1 50 51 56Mobil 1 ... 1 ... ...Oiltanking Houston ... ... ... ... 3Phillips ... ... 19 15 2Shell ... ... 35 ... ...Star Enterprise ... ... 1 3 6Texaco ... ... ... ... 2Total 5 39 346 308 232

MalaysiaAmoco 1 ... ... ... ...Astra ... ... 4 ... ...BHP § ... ... 1 ... 2British Petroleum ... ... 2 ... ...Chevron ... 3 2 ... 2Coastal 4 ... ... 2 ...Crown ... ... ... 0.2 ...Deer Park Ref. � ... ... ... 2 ...D. Shamrock ... ... ... 1 ...Koch ... ... ... ... 2La Gloria ... ... ... 1 ...Pacific Refining ... 1 ... ... ...Pacific Res. ¶ 10 5 ... ... ...Phibro 3 ... ... ... ...Shell 2 ... 1 2 ...Texaco ... 1 ... ... ...Thrifty 1 ... ... ... ...Unocal 2 ... ... ... ...Total 23 10 10 8 6

MexicoAmoco 64 75 71 68 70Ashland ... ... ... ... 13

Mexico (cont.) 1991 1992 1993 1994 1995

Bayway Ref.* ... ... ... ... 4British Petroleum ... ... ... 2 ...Chevron 131 131 126 155 135Citgo 47 60 66 55 31Clark 34 30 32 25 45Coastal 34 29 36 31 43Conoco 31 36 54 82 72Deer Park Ref. � ... ... ... 28 129Enron ... ... 1 ... ...Exxon 33 27 43 56 99Fina 21 24 38 34 45Hunt 6 8 9 7 8Koch 8 18 27 35 28Lyondell 82 53 31 4 ...Marathon 57 60 47 30 24Mobil 104 131 155 170 224Murphy 18 1 5 18 21Phibro ... ... ... 2 4Phillips ... ... ... 21 9Shell 72 82 110 91 80Star Enterprise ... ... 3 4 22Sun 20 31 26 31 15Tosco � 1 ... ... ... ...Ultramar ... 1 ... ... ...Unocal ... ... 2 ... ...Total 763 797 882 949 1,121

New ZealandBritish Petroleum ... ... 1 ... ...Deer Park Ref. � ... ... ... 1 ...Kerr-McGee ... ... 1 ... ...Shell ... ... 1 ... ...Total ... ... 3 1 ...

NigeriaAmerada Hess ... 35 71 115 145Amoco 55 56 82 32 44Ashland ... 8 4 1 ...Bayway Ref.* ... ... 3 8 1British Petroleum 184 184 211 153 198Chevron 89 81 128 61 1Citgo ... ... ... ... 1Clark ... ... 5 18 22Coastal ... ... ... 25 26Conoco 7 ... 2 ... ...Crown 6 1 2 2 9Deer Park Ref. � ... ... ... 33 6D. Shamrock ... ... ... 8 1Exxon ... 15 3 ... ...Fina ... 8 10 5 ...Indian Refining ... ... ... 10 ...Intercont. Term ... ... ... ... 1Kerr-McGee 1 1 4 ... ...Koch 7 ... 3 37 45La Gloria ... ... ... ... 1




Nigeria (cont.) 1991 1992 1993 1994 1995

LL&E ... ... ... 3 ...Lyondell 1 ... ... 1 7Marathon 3 ... 3 3 10Metallgesellschaft ... 5 ... ... ...Mobil ... 8 31 19 39Murphy 2 2 4 ... 2Phibro 7 4 3 2 ...Phillips 17 22 25 32 56Shell 117 142 105 63 39SW Refining ... ... ... 13 5Star Enterprise ... ... ... ... 3Sun 187 128 92 95 146Valero ... ... ... ... 1Total 683 700 791 739 809

NorwayAmerada Hess ... ... 3 11 3Amoco 10 1 ... 8 6Ashland ... 7 3 1 ...Bayway Ref.* ... ... 56 101 115British Petroleum 12 21 9 14 5Chevron ... ... ... 1 13Citgo ... ... ... ... 1Clark 2 7 3 ... 8Coastal ... ... 4 ... 2Crown 5 6 4 7 10Deer Park Ref. � ... ... ... 1 ...D. Shamrock 13 1 13 3 42Exxon 3 49 11 4 2Fina ... 1 1 ... 3Indian Refining ... ... ... 3 ...Kerr-McGee ... 3 ... ... ...Koch ... ... ... 6 7Marathon 1 9 7 ... ...Mobil 4 ... ... ... 1Murphy ... 3 1 ... ...Phibro ... ... ... 5 2Phillips 23 ... 4 11 20Shell ... ... ... 1 ...SW Refining ... ... ... 6 ...Strategic Pet. Res. ... 6 3 ... ...Sun ... 6 ... 18 45Total 73 120 122 201 285OmanAshland ... ... 3 1 3BHP § ... ... ... ... 4Chevron 2 4 6 19 5Crown ... ... 3 3 ...Exxon ... ... 2 4 ...Fina 2 ... ... ... ...Murphy ... ... ... ... 2Pacific Res. ¶ ... ... 1 ... ...Phillips ... ... ... 1 ...Shell ... ... 6 1 ...

Oman (cont.) 1991 1992 1993 1994 1995

Star Enterprise ... ... ... 1 ...Sun ... ... 1 1 ...Tosco � ... ... 8 14 5Total 4 4 30 45 19Papua New GuineaBHP § ... ... ... 10 5British Petroleum ... ... 2 ... ...Crown ... ... ... 2 ...D. Shamrock ... ... ... 0.2 ...Koch ... ... 2 2 ...Pacific Res. ¶ ... ... 2 ... ...Phibro ... ... 5 ... ...Shell ... ... ... 4 ...Total ... ... 11 18 5PeruAmoco ... ... ... ... 2Citgo ... ... ... ... 1Conoco ... ... ... ... 13Marathon ... ... ... ... 1Mobil 1 ... ... ... 1Phibro ... 1 ... ... ...Texaco ... ... ... ... 5Total 1 1 ... ... 23

PhilippinesUnocal ... 1 ... ... ...

RussiaAmoco ... ... ... 2 3Ashland ... ... ... 1 ...Chevron ... ... 1 ... ...Clark 2 1 3 1 3Coastal ... ... ... 3 ...Exxon ... ... 5 7 2Fina ... 1 3 ... ...Indian Refining ... ... ... 3 ...Lyondell ... 1 ... ... ...Marathon ... ... 6 7 5Mobil ... 2 7 3 ...Phibro 1 ... 8 1 1Total 3 5 33 28 14

Saudi ArabiaAmerada Hess ... 47 28 59 81Amoco 117 137 114 110 61Ashland 142 138 80 82 57British Petroleum ... ... ... 2 ...Chevron 214 172 160 155 176Clark 1 ... ... ... ...Coastal ... 11 1 ... ...Conoco ... ... 1 ... ...Deer Park Ref. � ... ... ... 27 5Exxon 237 188 94 117 145Fina 44 19 ... ... ...Hunt 4 7 8 8 3




S. Arabia (cont.) 1991 1992 1993 1994 1995

Intercont. Term ... ... ... ... 1Koch 3 ... ... ... ...Lion ... 23 26 33 31Lyondell 62 41 ... ... ...Marathon 141 137 110 91 111Mobil 59 53 41 59 90Murphy ... 1 ... ... ...Oiltanking Houston ... ... ... 1 ...Phibro 15 12 1 ... ...Phillips 41 64 52 70 75Shell 59 48 51 3 15Star Enterprise 520 496 493 463 514Sun 44 53 44 78 86Texaco 1 ... ... ... ...Total (France) ... ... ... 1 ...Tx Petrochem ... ... ... 1 ...Total 1,704 1,647 1,304 1,360 1,451

SingaporeChevron ... ... 1 ... ...Koch ... ... ... ... 1Total ... ... 1 ... 1

SpainDeer Park Ref. � ... ... ... ... 1Shell ... ... ... ... 0.4Total ... ... ... ... 1

SyriaAmoco ... ... 10 1 ...Chevron ... ... 1 1 ...Clark 1 ... ... ... ...Conoco ... ... 2 ... ...Crown 1 ... ... ... ...Exxon ... ... 1 ... ...Koch ... ... 3 ... ...Phibro 3 ... ... ... ...Total 5 ... 17 2 ...

ThailandAstra ... ... 2 ... ...British Petroleum 2 3 1 ... ...D. Shamrock ... ... 1 ... ...Kerr-McGee ... 1 1 ... ...Koch ... ... ... 2 1Lyondell ... ... ... 1 ...Shell ... ... 1 2 ...SW Refining ... ... ... 3 ...Unocal 1 ... ... 1 ...US Oil & Refining ... ... ... 0.2 ...Total 3 4 6 9 1

Trinidad & TobagoAmoco 70 69 54 61 66Clark 1 1 ... ... ...Coastal ... 1 ... ... ...Conoco ... ... 1 1 ...

T&T (cont.) 1991 1992 1993 1994 1995

Phibro 1 ... ... 0.3 ...Total 72 71 55 62 66

TunisiaCrown ... 2 ... ... ...

United Arab EmiratesAstra ... ... 1 ... ...Chevron ... ... ... 2 ...Clark ... ... ... ... ...Deer Park Ref. � ... ... ... 1 ...Exxon ... ... ... 3 ...Intercont. Term ... ... ... ... 1LL&E ... ... ... ... 1Phibro ... ... 4 ... ...Shell ... ... ... 2 1Total ... ... 5 8 3

United KingdomAmerada Hess ... ... 1 38 15Amoco 1 ... 1 7 18Ashland 4 ... 20 15 11Bayway Ref.* ... ... 12 13 22British Petroleum ... 1 ... 5 6Chevron 11 7 ... 13 4Citgo 3 4 14 10 17Clark 8 6 ... 4 19Coastal ... ... ... ... 7Conoco ... ... 3 ... 0.3Crown 17 18 23 18 22Deer Park Ref. � ... ... ... 4 ...D. Shamrock 2 25 29 51 24Enron ... ... 1 ... ...Exxon ... 1 3 15 11Fina 11 16 14 45 52Indian Refining ... ... ... 1 ...Kerr-McGee 20 14 12 ... ...Koch 1 22 22 17 32La Gloria ... ... ... 1 4LL&E ... ... ... ... 3Lyondell 2 3 ... 1 11Marathon 2 10 26 31 5Metallgesellschaft 3 3 ... ... ...Mobil 1 3 ... ... 3Murphy 1 7 8 6 ...Northeast Petro ... 1 ... ... ...Oiltanking Houston ... ... ... 3 ...Phibro ... ... ... 1 ...Phillips 4 7 7 3 14Shell ... 4 16 6 ...SW Refining ... ... ... 10 7Star Enterprise ... ... 1 4 ...Strategic Pet. Res. ... 4 8 12 ...Sun 14 41 91 115 94Texaco ... ... ... 11 ...Total 105 197 312 460 401

*See also Tosco. � Joint venture between Shell and Pemex.



Venezuela 1991 1992 1993 1994 1995

Deer Park Ref. � ... ... ... ... 1Amoco 18 29 33 31 43British Petroleum ... ... ... 10 4Caribbean Gulf ... 28 30 34 8Chevron 10 24 20 13 24Cibro ... 4 2 ... ...Citgo 152 294 309 307 348Clark 1 ... ... 9 22Coastal 22 33 30 42 51Conoco 76 67 44 44 41Ergon ... 12 21 21 19Exxon 18 13 3 4 3Hunt 7 7 8 7 10Koch 7 13 18 10 10Lyondell 7 29 134 119 161Marathon ... ... ... 12 9Mobil 37 59 118 121 119Murphy ... ... ... 14 35Neste ... ... ... ... 22Oiltanking Houston ... ... ... 12 16Phibro 7 25 40 34 59Phillips ... ... ... 25 40Seaview ... 3 ... ... ...Shell 1 ... ... ... ...Sinclair ... ... ... 4 3Sound Refining ... 2 2 3 2Star Enterprise 36 52 50 42 49Sun 13 19 16 ... 15Texaco 14 12 12 16 18Tosco � ... ... ... 1 ...Trifinery ... 12 16 19 ...Unoven ... 121 121 118 131US Oil & Refining ... 1 ... ... ...Total 426 859 1,027 1,072 1,263

VietnamChevron ... ... ... ... 1

Yemen 1991 1992 1993 1994 1995

Amoco ... ... 1 8 ...Ashland ... ... ... 1 ...British Petroleum 2 ... 2 ... ...Chevron ... ... ... 4 ...Clark 3 ... ... ... ...Coastal 3 ... ... ... ...Crown ... ... ... 1 ...Exxon ... ... 1 1 ...Fina 3 ... ... ... ...Koch ... ... ... 7 3La Gloria ... ... ... 0.3 ...Phillips ... ... 3 ... ...Shell 5 ... ... ... ...Sun ... ... ... ... 2Total 16 ... 7 22 5

ZaireAmerada Hess ... 1 ... 1 2British Petroleum 3 3 5 4 4Chevron 18 4 9 6 ...Clark ... ... ... ... 2Coastal 1 2 2 3 1Crown ... 4 ... ... 3Exxon 1 ... ... ... 2Kerr-McGee ... 2 ... ... ...Koch ... ... ... ... 1Lyondell ... ... 1 ... ...Mobil 1 ... ... ... ...Phibro 1 2 2 ... 2Phillips 1 ... ... ... ...Sun ... ... ... 2 1Total 26 18 19 16 18

Grand Total 5,338 6,399 7,043 7,469 8,217

Note: May not add due to rounding.

� Joint venture between Shell and Pemex. � See also Bayway Refining.

CCrruuddee OOiill PPrrooffiilleess


Crude Oil Profiles � A View Of the Market Through Each Grade . . . . . . . . . .H1

The Crude Oils And Their Key Characteristics . . . . . . . . . . . . . . . . . . . . . . . .H3

Crude Oil Streams Ranked And Indexed By Gravity . . . . . . . . . . . . . . . . . . .H7

Crude Oil Streams Ranked And Indexed By Sulfur Content . . . . . . . . . . . . . .H9

Crude Oil Streams Ranked And Indexed By Volume . . . . . . . . . . . . . . . . . . .H9

Crude Oil Streams Indexed By Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .H11

Crude Oil Profiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .H13

Abu Dhabi . . . . . . . . . . . . . . . . . .H13

Algeria . . . . . . . . . . . . . . . . . . . .H27

Angola . . . . . . . . . . . . . . . . . . . .H33

Argentina . . . . . . . . . . . . . . . . . .H39

Australia . . . . . . . . . . . . . . . . . . .H47

Brunei . . . . . . . . . . . . . . . . . . . . .H55

Cameroon . . . . . . . . . . . . . . . . . .H63

Canada . . . . . . . . . . . . . . . . . . . .H67

China . . . . . . . . . . . . . . . . . . . . .H73

Colombia . . . . . . . . . . . . . . . . . . .H77

Congo . . . . . . . . . . . . . . . . . . . . .H83

Dubai . . . . . . . . . . . . . . . . . . . . .H87

Ecuador . . . . . . . . . . . . . . . . . . .H91

Egypt . . . . . . . . . . . . . . . . . . . . .H93

Gabon . . . . . . . . . . . . . . . . . . . .H103

Indonesia . . . . . . . . . . . . . . . . .H109

Iran . . . . . . . . . . . . . . . . . . . . . .H129

Iraq . . . . . . . . . . . . . . . . . . . . . .H139

Kuwait . . . . . . . . . . . . . . . . . . . .H145

Libya . . . . . . . . . . . . . . . . . . . . .H147

Malaysia . . . . . . . . . . . . . . . . . .H161

Mexico . . . . . . . . . . . . . . . . . . .H171

Neutral Zone . . . . . . . . . . . . . . .H177

Nigeria . . . . . . . . . . . . . . . . . . .H183

Norway . . . . . . . . . . . . . . . . . . .H195

Oman . . . . . . . . . . . . . . . . . . . .H211

Papua New Guinea . . . . . . . . . .H213

Qatar . . . . . . . . . . . . . . . . . . . . .H215

Russia . . . . . . . . . . . . . . . . . . . .H219

Saudi Arabia . . . . . . . . . . . . . . .H223

Sharjah . . . . . . . . . . . . . . . . . . .H233

Syria . . . . . . . . . . . . . . . . . . . . .H237

United Kingdom . . . . . . . . . . . .H241

United States . . . . . . . . . . . . . . .H251

Venezuela . . . . . . . . . . . . . . . . .H261

Vietnam . . . . . . . . . . . . . . . . . . .H273

Yemen . . . . . . . . . . . . . . . . . . . .H275

Zaire . . . . . . . . . . . . . . . . . . . . .H279

CRUDE OIL HANDBOOK PIW © H1

CCRRUUDDEE OOIILL PPRROOFFIILLEESS ��

AA VViieeww OOff TThhee MMaarrkkeett TThhrroouugghh EEaacchh GGrraaddee

This section provides detailed profiles of 134 internationally traded crude oils,

including several new crude oils and condensates from Latin America, Europe,

and Asia. This section not only contains the most up-to-date, detailed assays for

the individual crude oil streams, but also complete assessments of their produc-

tion, quality, marketing, pricing, and logistical positions. It is a comprehensive

reference section that is meant to complement the earlier descriptive chapters.

This section essentially allows the reader to have a close look at the pieces that togeth-er constitute the international crude oil market. The presentation of the information onthe individual crude oils is self-explanatory, with further details on marketing availablein many cases in the sections on country crude oil sales policies in Chapter F. ChapterE, on refining, also covers the basic technical aspects of the crude oil assays. The infor-mation on the individual crude oils is as up-to-date and complete as possible, but thecoverage of some crude oils is not as comprehensive as that of others because of thelimited availability of certain data.

All of the crude oil profiles are organized alphabetically according to country.

In order to make this section easy to use, several indexes have also been pre-

pared. For quick comparisons, the first lists the crude oils as they appear in the hand-book along with some key data on volume, specifications, and loading ports. The nextindex lists all of the crude oil names alphabetically � both those names currently in useand the secondary or former names of the crude oils. The third, fourth, and fifth index-es list all of the crude oils by their API gravities, their sulfur contents, and their supplyvolumes.


THE CRUDE OILS AND THEIR KEY CHARACTERISTICSGravity API Sulfur Volume PrimaryCountry/Crude Oil Gravity Content 1,000 b/d Loading Port Page

Abu DhabiAbu Bukhoosh 31.5 1.90 35 Abu al-Bukhoosh H13Mubarraz 39.5 0.90 15 Mubarraz Island H15Murban 40.4 0.79 890 Jebel Dhanna H17Thamama Condensate 57.5 0.11 130 Jebel Dhanna H19Umm Shaif 36.8 1.38 190 Das Island H21Upper Zakum 32.9 1.78 460 Das Island H23Zakum 39.2 1.10 245 Das Island H25

AlgeriaAlgerian Condensate 64.6 <0.01 300 Arzew H27Saharan Blend 46.1 0.11 700 Arzew/Bejaia/Skikda H29Zarzaitine 42.8 0.01 100 La Skhirra (Tunisia) H31

AngolaCabinda 32.0 0.13 430 Cabinda H33Palanca 38.6 0.14 175 Palanca H35Soyo 39.5 0.12 95 Quinfuquena H37

ArgentinaCanadon Seco 25.7 0.20 90 Celeta Olivia, Caltea Cordova H39Escalante 24.1 0.19 50 Bahia Blanca H41Medanito 35.1 0.43 300 Bahia Blanca H43Rincon 36.1 0.28 95 San Vincente, Chile H45

AustraliaCossack 47.0 0.03 115 Cossack FPSO H47Gippsland 47.0 0.09 228 Westernport H49Griffin 55.0 0.03 80 Griffin FPSO H51Northwest Shelf Condensate 59.5 <0.01 80 Withnell Bay H53

BruneiBrunei Condensate 66.5 <0.01 20 Seria H55Brunei Light 40.3 0.06 50 Seria H57Champion 23.7 0.13 80 Seria H59Seria Light Export Blend 34.6 0.08 70 Seria H61

CameroonKole 34.8 0.30 75 Kole H63Lokele 19.6 0.41 20 Lokele H65

CanadaBow River 25.6 2.37 660 Interprovincial Pipe Line H67Hibernia 32.0 0.50 ... Hibernia Platform H69Mixed Blend Sweet 39.0 0.39 250 Interprovincial Pipe Line H71

ChinaDaqing 32.1 0.11 1,100 Dairen (Dalian) H73Shengli 22.5 0.90 600 Qingdao (T�sing Tao) H75

ColombiaCano Limon 29.5 0.47 215 Covenas H77Cusiana 36.3 0.25 200 Covenas H79Vasconia 25.3 0.81 145 Covenas H81

CongoDjeno 27.6 0.23 150 Djeno H83N�Kossa 39.5 0.08 90 N�Kossa H85

DubaiDubai 31.0 2.04 250 Fateh H87Margham Condensate 50.2 0.04 25 Jebel Ali H89

H4 PIW © CRUDE OIL HANDBOOK

THE CRUDE OILS AND THEIR KEY CHARACTERISTICS (cont.) Gravity API Sulfur Volume PrimaryCountry/Crude Oil Gravity Content 1,000 b/d Loading Port Page

EcuadorOriente 28.8 1.02 350 Esmeraldas H91

EgyptBelayim Blend 26.1 2.23 200 Wadi El Firan H93Ras Budran 24.3 2.39 20 Ras Budran H95Ras Gharib Blend 24.1 3.00 25 Ras Gharib H97Suez Blend 31.5 1.54 400 Ras Shukheir H99Zeit Bay 33.8 1.35 20 Zeit Bay H101

GabonLucina 39.2 0.03 8 Lucina H103Mandji 30.2 1.14 120 Cape Lopez H105Rabi 34.6 0.06 220 Cape Lopez (Shell) /Gamba (Elf) H107

IndonesiaArdjuna 36.7 0.09 80 Ardjuna H109Arun Condensate 54.3 <0.01 90 Lhokseumawe H111Attaka 42.3 0.09 50 Santan H113Belida 40.0 0.01 115 Belida H115Cinta 32.8 0.12 55 Cinta H117Duri 20.3 0.19 275 Dumai H119Handil 32.2 0.10 40 Senipah H121Lalang 39.2 0.11 25 Lalang Marine Terminal H123Minas 34.1 0.09 395 Dumai H125Widuri 33.2 0.07 75 Widuri H127

IranForoozan Blend 30.7 2.50 275 Kharg Island H129Iran Heavy 30.2 1.77 1,500 Kharg Island H131Iran Light 33.1 1.50 1,300 Kharg Island H133Lavan Blend 34.3 1.87 140 Lavan Island H135Sirri 30.3 2.26 30 Sirri Island H137

IraqBasrah Light 34.4 2.10 300 Mina Al-Bakr/Ceyhan (Turkey) H139Fao Blend 27.5 2.90 ... Mina Al-Bakr H141Kirkuk 37.0 2.00 250 Ceyhan (Turkey) H143

KuwaitKuwait 30.5 2.55 1,800 Mina Al Ahmadi H145

LibyaAmna 36.1 0.15 115 Ras Lanuf H147Bouri 26.0 ... 90 Bouri H149Brega 39.8 0.20 120 Marsa El Brega H151Es Sider 37.0 0.27 445 Es Sider H153Sarir 37.6 0.16 195 Marsa El Hariga H155Sirtica 42.2 0.40 85 Ras Lanuf H157Zueitina 41.5 0.31 70 Zueitina H159

MalaysiaBintulu Condensate 66.2 0.04 60 Bintulu H161Dulang 39.9 0.12 100 Dulang Terminal H163Labuan 32.1 0.07 80 Labuan H165Miri 29.6 0.07 60 Miri H167Tapis 45.2 0.03 340 Tapis H169

MexicoIsthmus 33.3 1.22 920 Dos Bocas/Salina Cruz H171Maya 21.5 3.43 1,350 Cayo Arcas/Salina Cruz H173Olmeca 39.1 0.72 580 Dos Bocas H175


THE CRUDE OILS AND THEIR KEY CHARACTERISTICS (cont.) Gravity API Sulfur Volume PrimaryCountry/Crude Oil Gravity Content 1,000 b/d Loading Port Page

Neutral ZoneHout 32.5 1.90 30 Ras al-Khafji H177Khafji 28.5 2.85 280 Ras al-Khafji H179Wafra 24.2 4.00 200 Mina Saud (Mina al-Zour) H181

NigeriaBonny Light 35.4 0.14 475 Bonny H183Bonny Medium 26.5 0.22 80 Bonny H185Brass River 41.5 0.09 150 Brass River H187Escravos 36.2 0.14 360 Escravos H189Forcados 28.5 0.19 450 Forcados H191Qua Iboe 35.9 0.12 340 Qua Iboe H193

NorwayDraugen 39.8 0.15 130 Draugen H195Ekofisk 39.4 0.19 530 Tees River (UK) H197Gullfaks 29.9 0.41 460 Gullfaks/Mongstad H199Heidrun 28.6 0.46 230 Heidrun H201Oseberg 36.3 0.29 700 Sture H203Sleipner Condensate 59.0 0.02 110 Karsto H205Statfjord 38.7 0.24 790 Statfjord/Mongstad H207Troll 28.6 0.29 200 Mongstad H209

OmanOman 35.2 0.89 880 Mina Al Fahal H211

Papua New GuineaKutubu 44.0 0.04 100 Kumul H213

QatarDukhan 41.1 1.22 240 Umm Said H215Qatar Marine 36.2 1.60 200 Halul Island H217

RussiaSiberian Light 35.6 0.46 90* Tuapse H219Urals 33.4 1.19 2,500* Novorossiysk/Ventspils H221

Saudi ArabiaArabian Extra Light 36.4 1.19 950 Ras Tanura H223Arabian Heavy 27.5 2.92 400 Juaymah/Ras Tanura H225Arabian Light 32.7 1.80 5,000 Juaymah/Ras Tanura/Yanbu H227Arabian Medium 31.8 2.45 1,300 Juaymah/Ras Tanura H229Arabian Super Light 50.6 0.04 200 Yanbu H231

SharjahMubarak 38.2 0.57 17 Mubarak H233Sharjah Condensate 50.0 0.08 40 Hamriyah Terminal H235

SyriaSouedieh 24.0 4.05 150 Baniyas/Tartous H237Syrian Light 36.5 0.66 450 Baniyas/Tartous H239

United KingdomBrent Blend 38.3 0.37 775 Sullom Voe H241Captain 20.0 0.50 ... Captain FPSO H243Flotta 35.4 1.22 250 Flotta H245Forties 40.1 0.34 975 Hound Point H247Liverpool Bay 43.3 0.24 40 Liverpool Bay Platform H249

United StatesAlaskan North Slope 27.5 1.16 1,450 Valdez H251Light Louisiana Sweet 38.7 0.13 600 St. James H253


THE CRUDE OILS AND THEIR KEY CHARACTERISTICS (cont.) API Sulfur Volume Primary

Country/Crude Oil Gravity Content 1,000 b/d Loading Port Page

United States (cont.) Mars Blend 31.0 2.00 70 Clovelly, LOOP H255West Texas Intermediate 39.6 0.24 750 Cushing/Midland H257West Texas Sour 34.2 1.30 775 Midland H259

VenezuelaBachaquero 13.0 2.68 250 Punta Cardon H261BCF-17 16.2 2.47 ... La Salina H263Boscan 10.1 5.40 60 Bajo Grande H265Furrial 30.0 1.10 300 Puerto La Cruz H267Tia Juana Heavy 12.3 2.82 80 Punta Cardon H269Tia Juana Light 32.0 1.20 240 La Salina H271

VietnamBach Ho 33.8 0.08 140 Bach Ho Platform H273

YemenMarib 48.0 0.10 170 Ras Isa H275Masila 30.5 0.62 175 Ash Shihr H277

ZaireZaire 31.2 0.11 30 Moanda Terminal H279

*Export figures.


GravityAPI Stream Country Page66.5 Brunei Condensate Brunei H5566.2 Bintulu Condensate Malaysia H16164.6 Algerian Condensate Algeria H2759.5 Northwest Shelf Cond. Australia H5359.0 Sleipner Condensate Norway H20557.5 Thamama Condensate Abu Dhabi H1955.0 Griffin Australia H5154.3 Arun Condensate Indonesia H11150.6 Arabian Super Light S. Arabia H23150.2 Margham Condensate Dubai H8950.0 Sharjah Condensate Sharjah H23548.0 Marib Yemen H27747.0 Cossack Australia H4747.0 Gippsland Australia H4946.1 Saharan Blend Algeria H2945.2 Tapis Malaysia H16944.0 Kutubu PNG H21343.3 Liverpool Bay UK H25142.8 Zarzaitine Algeria H3142.3 Attaka Indonesia H11342.2 Sirtica Libya H15741.5 Zueitina Libya H15941.5 Brass River Nigeria H18741.1 Dukhan Qatar H21540.4 Murban Abu Dhabi H1740.3 Brunei Light Brunei H5740.1 Forties UK H24940.0 Belida Indonesia H11539.9 Dulang Malaysia H16339.8 Brega Libya H15139.8 Draugen Norway H19539.6 West Texas Intermediate United States H25939.5 Mubarraz Abu Dhabi H1539.5 Soyo Angola H3739.5 N�Kossa Congo H8539.4 Ekofisk Norway H19739.2 Zakum Abu Dhabi H2539.2 Lucina Gabon H10339.2 Lalang Indonesia H12339.1 Olmeca Mexico H17539.0 Mixed Blend Sweet Canada H7138.7 Statfjord Norway H20738.7 Light Louisiana Sweet United States H25538.6 Palanca Angola H3538.3 Brent Blend UK H24338.2 Mubarak Sharjah H23337.6 Sarir Libya H15537.0 Kirkuk Iraq H14337.0 Es Sider Libya H15336.8 Umm Shaif Abu Dhabi H2136.7 Ardjuna Indonesia H10936.5 Syrian Light Syria H24136.4 Arabian Extra Light S. Arabia H22336.3 Cusiana Colombia H7936.3 Oseberg Norway H20336.2 Escravos Nigeria H189

GravityAPI Stream Country Page36.2 Qatar Marine Qatar H21736.1 Rincon Argentina H4536.1 Amna Libya H14735.9 Qua Iboe Nigeria H19335.6 Siberian Light Russia H21935.4 Bonny Light Nigeria H18335.4 Flotta UK H24735.2 Oman Oman H21135.1 Medanito Argentina H4334.8 Kole Cameroon H6334.6 Seria Light Ex. Blend Brunei H6134.6 Rabi Gabon H10734.4 Basrah Light Iraq H13934.3 Lavan Blend Iran H13534.2 West Texas Sour United States H26134.1 Minas Indonesia H12533.8 Zeit Bay Egypt H10133.8 Bach Ho Vietnam H27533.4 Urals Russia H22133.3 Isthmus Mexico H17133.2 Widuri Indonesia H12733.1 Iran Light Iran H13332.9 Upper Zakum Abu Dhabi H2332.8 Cinta Indonesia H11732.7 Arabian Light S. Arabia H22732.5 Hout Neutral Zone H17732.2 Handil Indonesia H12132.1 Daqing China H7332.1 Labuan Malaysia H16532.0 Cabinda Angola H3332.0 Hibernia Canada H6932.0 Tia Juana Light Venezuela H27331.8 Arabian Medium S. Arabia H22931.5 Abu Bukhoosh Abu Dhabi H1331.5 Suez Blend Egypt H9931.2 Zaire Zaire H28131.0 Dubai Dubai H8731.0 Mars Blend United States H25730.7 Foroozan Blend Iran H12930.5 Kuwait Kuwait H14530.5 Masila Yemen H27930.3 Sirri Iran H13730.2 Mandji Gabon H10530.2 Iran Heavy Iran H13130.0 Furrial Venezuela H26929.9 Gullfaks Norway H19929.6 Miri Malaysia H16729.5 Cano Limon Colombia H7728.8 Oriente Ecuador H9128.6 Heidrun Norway H20128.6 Troll Norway H20928.5 Khafji Neutral Zone H17928.5 Forcados Nigeria H19127.6 Djeno Congo H8327.5 Fao Blend Iraq H14127.5 Arabian Heavy S. Arabia H225

CRUDE OIL STREAMS RANKED AND INDEXED BY GRAVITY


GravityAPI Stream Country Page27.5 Alaskan North Slope United States H25326.5 Bonny Medium Nigeria H18526.1 Belayim Blend Egypt H9326.0 Bouri Libya H14925.7 Canadon Seco Argentina H3925.6 Bow River Canada H6725.3 Vasconia Colombia H8124.3 Ras Budran Egypt H9524.2 Wafra Neutral Zone H18124.1 Escalante Argentina H4124.1 Ras Gharib Blend Egypt H97

GravityAPI Stream Country Page24.0 Souedieh Syria H23923.7 Champion Brunei H5922.5 Shengli China H7521.5 Maya Mexico H17320.3 Duri Indonesia H11920.0 Captain UK H24519.6 Lokele Cameroon H6516.2 BCF-17 Venezuela H26513.0 Bachaquero Venezuela H26312.3 Tia Juana Heavy Venezuela H27110.1 Boscan Venezuela H267

CRUDE OIL STREAMS RANKED AND INDEXED BY GRAVITY (cont.)

Sulfur(%) Stream Country Page

<0.01 Algerian Condensate Algeria H27<0.01 Arun Condensate Indonesia H111<0.01 Brunei Condensate Brunei H55<0.01 Northwest Shelf Cond. Australia H530.01 Zarzaitine Algeria H310.01 Belida Indonesia H1150.02 Sleipner Condensate Norway H2050.03 Cossack Australia H470.03 Griffin Australia H510.03 Lucina Gabon H1030.03 Tapis Malaysia H1690.04 Margham Condensate Dubai H890.04 Bintulu Condensate Malaysia H1610.04 Kutubu PNG H2130.04 Arabian Super Light S. Arabia H2310.06 Brunei Light Brunei H570.06 Rabi Gabon H1070.07 Widuri Indonesia H1270.07 Labuan Malaysia H1650.07 Miri Malaysia H1670.08 Seria Light Export Blend Brunei H610.08 N�Kossa Congo H850.08 Sharjah Condensate Sharjah H2350.08 Bach Ho Vietnam H2730.09 Gippsland Australia H490.09 Ardjuna Indonesia H1090.09 Attaka Indonesia H1130.09 Minas Indonesia H1250.09 Brass River Nigeria H1870.10 Handil Indonesia H1210.10 Marib Yemen H2750.11 Thamama Condensate Abu Dhabi H190.11 Saharan Blend Algeria H290.11 Daqing China H730.11 Lalang Indonesia H1230.11 Zaire Zaire H2790.12 Soyo Angola H370.12 Cinta Indonesia H117

Sulfur(%) Stream Country Page0.12 Dulang Malaysia H1630.12 Qua Iboe Nigeria H1930.13 Cabinda Angola H330.13 Champion Brunei H590.13 Light Louisiana Sweet United States H2530.14 Palanca Angola H350.14 Bonny Light Nigeria H1830.14 Escravos Nigeria H1890.15 Amna Libya H1470.15 Draugen Norway H1950.16 Sarir Libya H1550.19 Escalante Argentina H410.19 Duri Indonesia H1190.19 Forcados Nigeria H1910.19 Ekofisk Norway H1970.20 Canadon Seco Argentina H390.20 Brega Libya H1510.22 Bonny Medium Nigeria H1850.23 Djeno Congo H830.24 Statfjord Norway H2070.24 Liverpool Bay UK H2490.24 West Texas Intermediate United States H2570.25 Cusiana Colombia H790.27 Es Sider Libya H1530.28 Rincon Argentina H450.29 Oseberg Norway H2030.29 Troll Norway H2090.30 Kole Cameroon H630.31 Zueitina Libya H1590.34 Forties UK H2470.37 Brent Blend UK H2410.39 Mixed Blend Sweet Canada H710.40 Sirtica Libya H1570.41 Lokele Cameroon H650.41 Gullfaks Norway H1990.43 Medanito Argentina H430.46 Heidrun Norway H2010.46 Siberian Light Russia H219

CRUDE OIL STREAMS RANKED AND INDEXED BY SULFUR CONTENT

(1,000 b/d) Vol. Stream Country Page

5,000 Arabian Light S. Arabia H2272,500 Urals Russia H2211,800 Kuwait Kuwait H1451,500 Iran Heavy Iran H1311,450 Alaskan North Slope United States H2511,350 Maya Mexico H1731,300 Iran Light Iran H1331,300 Arabian Medium S. Arabia H2291,100 Daqing China H73

975 Forties UK H247950 Arabian Extra Light S. Arabia H223920 Isthmus Mexico H171890 Murban Abu Dhabi H17880 Oman Oman H211790 Statfjord Norway H207775 Brent Blend UK H241775 West Texas Sour United States H259750 West Texas Intermediate United States H257700 Saharan Blend Algeria H29700 Oseberg Norway H203

(1,000 b/d) Vol. Stream Country Page660 Bow River Canada H67600 Shengli China H75600 Light Louisiana Sweet United States H253580 Olmeca Mexico H175530 Ekofisk Norway H197475 Bonny Light Nigeria H183460 Upper Zakum Abu Dhabi H23460 Gullfaks Norway H199450 Forcados Nigeria H191450 Syrian Light Syria H239445 Es Sider Libya H153430 Cabinda Angola H33400 Suez Blend Egypt H99400 Arabian Heavy S. Arabia H225395 Minas Indonesia H125360 Escravos Nigeria H189350 Oriente Ecuador H91340 Tapis Malaysia H169340 Qua Iboe Nigeria H193300 Algerian Condensate Algeria H27


Sulfur(%) Stream Country Page0.47 Cano Limon Colombia H770.50 Hibernia Canada H690.50 Captain UK H2430.57 Mubarak Sharjah H2330.62 Masila Yemen H2770.66 Syrian Light Syria H2390.72 Olmeca Mexico H1750.79 Murban Abu Dhabi H170.81 Vasconia Colombia H810.89 Oman Oman H2110.90 Mubarraz Abu Dhabi H150.90 Shengli China H751.02 Oriente Ecuador H911.10 Zakum Abu Dhabi H251.10 Furrial Venezuela H2671.14 Mandji Gabon H1051.16 Alaskan North Slope United States H2511.19 Urals Russia H2211.19 Arabian Extra Light S. Arabia H2231.20 Tia Juana Light Venezuela H2711.22 Isthmus Mexico H1711.22 Dukhan Qatar H2151.22 Flotta UK H2451.30 West Texas Sour United States H2591.35 Zeit Bay Egypt H1011.38 Umm Shaif Abu Dhabi H211.50 Iran Light Iran H1331.54 Suez Blend Egypt H991.60 Qatar Marine Qatar H217

Sulfur(%) Stream Country Page1.77 Iran Heavy Iran H1311.78 Upper Zakum Abu Dhabi H231.80 Arabian Light S. Arabia H2271.87 Lavan Blend Iran H1351.90 Abu Bukhoosh Abu Dhabi H131.90 Hout Neutral Zone H1772.00 Kirkuk Iraq H1432.00 Mars Blend United States H2552.04 Dubai Dubai H872.10 Basrah Light Iraq H1392.23 Belayim Blend Egypt H932.26 Sirri Iran H1372.37 Bow River Canada H672.39 Ras Budran Egypt H952.45 Arabian Medium S. Arabia H2292.47 BCF-17 Venezuela H2632.50 Foroozan Blend Iran H1292.55 Kuwait Kuwait H1452.68 Bachaquero Venezuela H2612.82 Tia Juana Heavy Venezuela H2692.85 Khafji Neutral Zone H1792.90 Fao Blend Iraq H1412.92 Arabian Heavy S. Arabia H2253.00 Ras Gharib Blend Egypt H973.43 Maya Mexico H1734.00 Wafra Neutral Zone H1814.05 Souedieh Syria H2375.40 Boscan Venezuela H265

CRUDE OIL STREAMS RANKED AND INDEXED BY SULFUR CONTENT (cont.)

CRUDE OIL STREAMS RANKED AND INDEXED BY VOLUME


(1,000 b/d) Vol. Stream Country Page300 Medanito Argentina H43300 Basrah Light Iraq H139300 Furrial Venezuela H267280 Khafji Neutral Zone H179275 Duri Indonesia H119275 Foroozan Blend Iran H129250 Mixed Blend Sweet Canada H71250 Dubai Dubai H87250 Kirkuk Iraq H143250 Flotta UK H245250 Bachaquero Venezuela H261245 Zakum Abu Dhabi H25240 Dukhan Qatar H215240 Tia Juana Light Venezuela H271230 Heidrun Norway H201228 Gippsland Australia H49220 Rabi Gabon H107215 Cano Limon Colombia H77200 Cusiana Colombia H79200 Belayim Blend Egypt H93200 Wafra Neutral Zone H181200 Troll Norway H209200 Qatar Marine Qatar H217200 Arabian Super Light S. Arabia H231195 Sarir Libya H155190 Umm Shaif Abu Dhabi H21175 Palanca Angola H35175 Masila Yemen H277170 Marib Yemen H275150 Djeno Congo H83150 Brass River Nigeria H187150 Souedieh Syria H237145 Vasconia Colombia H81140 Lavan Blend Iran H135140 Bach Ho Vietnam H273130 Thamama Condensate Abu Dhabi H19130 Draugen Norway H195120 Mandji Gabon H105120 Brega Libya H151115 Cossack Australia H47115 Belida Indonesia H115115 Amna Libya H147110 Sleipner Condensate Norway H205100 Zarzaitine Algeria H31100 Dulang Malaysia H163

(1,000 b/d) Vol. Stream Country Page100 Kutubu PNG H21395 Soyo Angola H3795 Rincon Argentina H4590 Canadon Seco Argentina H3990 N�Kossa Congo H8590 Arun Condensate Indonesia H11190 Bouri Libya H14990 Siberian Light Russia H21985 Sirtica Libya H15780 Griffin Australia H5180 Northwest Shelf Cond. Australia H5380 Champion Brunei H5980 Ardjuna Indonesia H10980 Labuan Malaysia H16580 Bonny Medium Nigeria H18580 Tia Juana Heavy Venezuela H26975 Kole Cameroon H6375 Widuri Indonesia H12770 Seria Light Export Blend Brunei H6170 Zueitina Libya H15970 Mars Blend United States H25560 Bintulu Condensate Malaysia H16160 Miri Malaysia H16760 Boscan Venezuela H26555 Cinta Indonesia H11750 Escalante Argentina H4150 Brunei Light Brunei H5750 Attaka Indonesia H11340 Handil Indonesia H12140 Sharjah Condensate Sharjah H23540 Liverpool Bay UK H24935 Abu Bukhoosh Abu Dhabi H1330 Sirri Iran H13730 Hout Neutral Zone H17730 Zaire Zaire H27925 Margham Condensate Dubai H8925 Ras Gharib Blend Egypt H9725 Lalang Indonesia H12320 Brunei Condensate Brunei H5520 Lokele Cameroon H6520 Ras Budran Egypt H9520 Zeit Bay Egypt H10117 Mubarak Sharjah H23315 Mubarraz Abu Dhabi H158 Lucina Gabon H103

CRUDE OIL STREAMS RANKED AND INDEXED BY VOLUME (cont.)


Crude Oil Name Country PageABK Abu Dhabi H13Abu Bukhoosh Abu Dhabi H13Abu Bukoosh Abu Dhabi H13Abu Dhabi Abu Dhabi H17Agha Jari Iran H133Alaskan North Slope United States H251Alberta Light Canada H71Algerian Condensate Algeria H27Alif Yemen H275Amal Libya H147Amana Venezuela H267Amna Libya H147ANS United States H251Arabian Extra Light Saudia Arabia H223Arabian Heavy Saudia Arabia H225Arabian Light Saudia Arabia H227Arabian Medium Saudia Arabia H229Arabian Super Light Saudia Arabia H231Arabian Ultra Light Saudia Arabia H231Ardjuna Indonesia H109Arjuna Indonesia H109Arun Condensate Indonesia H111Arzew Algeria H29Attaka Indonesia H113Bach Ho Vietnam H273Bachaquero Venezuela H261Basrah Heavy (before �81) Iraq H141Basrah Light Iraq H139Basrah Medium Iraq H141Bass Strait Australia H49BBQ Nigeria H183BBQ Nigeria H187BBQ Nigeria H193BCF-17 Venezuela H263Belayim Blend Egypt H93Belida Indonesia H115Berri Saudia Arabia H223Bintulu Condensate Malaysia H161Bonny Light Nigeria H183Bonny Medium Nigeria H185Boscan Venezuela H265Bouri Libya H149Bow River Canada H67Brass Blend Nigeria H187Brass River Nigeria H187Brega Libya H151Brent Blend United Kingdom H241Brunei Condensate Brunei H55Brunei Light Brunei H57Cabinda Angola H33Canadian Par Canada H71Canadon Seco Argentina H39Cano Limon Colombia H77Captain United Kingdom H243Champion Brunei H59Cinta Indonesia H117Cinta Blend Indonesia H117

Crude Oil Name Country PageCossack Australia H47Cusiana Colombia H79Cusiana Light Colombia H79Cusiana/Cupiagua Colombia H79Cyrus Iran H129Daqing China H73Darius Iran H129Djeno Congo H83Draugen Norway H195Dubai Dubai H87Dukhan Qatar H215Dulang Malaysia H163Duri Indonesia H119Ekofisk Norway H197El Morgan Egypt H99Emeraude Congo H83Es Sider Libya H153Escalante Argentina H41Escravos Nigeria H189Fao Blend Iraq H141Fateh Dubai H87Fereidoon Iran H129Flotta United Kingdom H245Forcados Nigeria H191Foroozan Blend Iran H129Forouzan Iran H129Forties United Kingdom H247Furrial Venezuela H267Gachsaran Iran H131Gharib Blend Egypt H97Gippsland Australia H49Gippsland Blend Australia H49Griffin Australia H51Gulf of Suez Egypt H99Gullfaks Norway H199Gullfaks A-B Norway H199Gullfaks C Norway H199Handil Indonesia H121Hassi-Messaoud Algeria H29Heidrun Norway H201Hibernia Canada H69Hout Neutral Zone H177Iagifu Papua NG H213Intan-Cinta Indonesia H117Iran Heavy Iran H131Iran Light Iran H133Isthmus Mexico H171Khafji Neutral Zone H179Kirkuk Iraq H143Kole Cameroon H63Kutubu Papua NG H213Kuwait Kuwait H145Labuan Malaysia H165Lalang Indonesia H123Lalang Export Blend Indonesia H123Lavan Blend Iran H135Libyan Light Libya H159

CRUDE OIL STREAMS INDEXED BY NAME (Primary Names In Bold)


Crude Oil Name Country PageLight Louisiana Sweet United States H253Liverpool Bay United Kingdom H249LLS United States H253Lokele Cameroon H65Lower Zakum Abu Dhabi H25Lucina Gabon H103Malongo Angola H33Mandji Gabon H105Margham Condensate Dubai H89Marib Yemen H275Mars Blend United States H255Masila Yemen H277Maya Mexico H173Medanito Argentina H43Mesa Venezuela H267Minas Indonesia H125Miri Malaysia H167Miri Light Malaysia H167Mixed Blend Sweet Canada H71Mubarak Sharjah H233Mubarek Sharjah H233Mubarraz Abu Dhabi H15Murban Abu Dhabi H17N�Kossa Congo H85Nigerian Export Blend Nigeria H191Nigerian Light Nigeria H183Nigerian Light Gulf Nigeria H189Nigerian Light Mobil Nigeria H193Nigerian Medium Nigeria H185Ninian United Kingdom H241Northwest Shelf Cond. Australia H53Olmeca Mexico H175Oman Oman H211Oriente Ecuador H91Oseberg Norway H203Oseberg Blend Norway H203Palanca Angola H35Pulai Malaysia H169Qatar Land Qatar H215Qatar Marine Qatar H217Qua Iboe Nigeria H193Rabi Gabon H107Rabi Export Blend Gabon H107Rabi Kounga Gabon H107Rabi Light Gabon H107Ras Budran Egypt H95Ras Gharib Egypt H97Ras Gharib Blend Egypt H97Rincon Argentina H45Rincon De Los Sauces Argentina H45Rio Negro Argentina H43Rostam Iran H135

Crude Oil Name Country PageSafaniyah Saudia Arabia H225Saharan Algeria H29Saharan Blend Algeria H29Salman Iran H135Sarir Libya H155Sassan Iran H135Senipah Indonesia H121Seria Light Export Blend Brunei H61Sharjah Condensate Sharjah H235Shengli China H75Siberian Light Russia H219Sirri Iran H137Sirri Heavy Iran H137Sirtica Libya H157SLC Indonesia H125Sleipner Condensate Norway H205Souedieh Syria H237Soyo Angola H37Statfjord Norway H207Suez Blend Egypt H99Sumatran Light Indonesia H125Sumatran Light Ex. Blend Indonesia H125Suwaidiyah Syria H237Syrian Export Blend Syria H239Syrian Light Syria H239Takula Angola H33Tapis Malaysia H169Tapis Blend Malaysia H169Thamama Condensate Abu Dhabi H19Tia Juana Heavy Venezuela H269Tia Juana Light Venezuela H271Tia Juana Livano Venezuela H271Tia Juana Pesado Venezuela H269Troll Norway H209Umm Shaif Abu Dhabi H21Upper Zakum Abu Dhabi H23Urals Russia H221Vasconia Colombia H81Wafra Neutral Zone H181Wanaea/Cossack Australia H47West Texas Intermediate United States H257West Texas Sour United States H259White Tiger Vietnam H273Widuri Indonesia H127Widuri Blend Indonesia H127WTI United States H257WTS United States H259Zaire Zaire H279Zakum Abu Dhabi H25Zarzaitine Algeria H31Zeit Bay Egypt H101Zueitina Libya H159

CRUDE OIL STREAMS INDEXED BY NAME (Primary Names In Bold)


ABU BUKHOOSH Abu Dhabi

Gravity: 31.5 Sulfur: 1.90 Loading Port: Abu al-BukhooshOther Names: ABK, Abu Bukoosh

Production

About 35,000 barrels a day from an offshore field discovered in 1973. Output was 60,000b/d in 1986 before platform was accidentally attacked in Iraq-Iran war. Restarted inspring of 1987.

Quality

A medium to heavy Mideast crude oil similar in quality to Arabian Medium.

Producers

Total-ABK: Total (operator) (75%) , Japan Indonesia Petroleum (25%). Previous shareholders include Amerada Hess, Charter, and Kerr Mc-Gee.

Pricing And Marketing

Marketed mainly to Japan and other countries East of Suez by the equity producers andmarketing intermediaries. Japan imported 28,000 b/d in 1995. No regular term-contractprice determination by state Adnoc due to small volumes and dominant sales role ofequity producers. Rarely moves to Atlantic Basin.

Sellers

Total Petroleum Services Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44-171) 935-3222, Fax: (44-171) 935-3102.

Main Customers

Japanese trading houses and refiners.

Loading Port

Abu al-Bukhoosh. 25.29 N. 53.08 E. The crude oil-loading terminal is at the productionplatform and is capable of accommodating ships with a maximum of 300,000 deadweighttons and maximum draft of 22 meters. A 230,000 dwt tanker is used for storage, and ves-sels moor along side to load.


ABU BUKHOOSH ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31.5 Sulfur Content % Weight 1.9Barrels /Metric Ton 7.255 Pour Point Temp. C -27Viscosity Centistokes 17.3 Reid Vapor Press. Lbs/Sq. In. 3(Kinematic) at 50 F

REFINED PRODUCT BREAKDOWNS AND PROPERTIES

Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <5/<41 1.2 0.8Light Naphtha 5-85 6.2 4.9 Light Naphtha

41-185 Octane RON Clear Octane 66Int. Naphtha 85-165 14.1 12.1 Intermediate Naphtha

185-329 Paraffins % Wt. 62Naphthenes % Wt. 22Aromatics % Wt. 16

Kerosine 165-235 13.3 12.2 Kerosine329-455 Sulfur Content % Wt. 0.15

Light Gas Oil 235-300 12.3 12 Light Gas Oil455-572 Sulfur Content % Wt. 1.01

Cetane Index 51.8Int. Gas Oil 300-350 9.1 9.2 Intermediate Gas Oil

572-662 Sulfur Content % Wt. 1.8Cetane Index 54

Residue >350 44.2 48.8 Residue>662 Sulfur Content % Wt. 3.24

Pour Point Temp. C/F 24/75.2Viscosity (Kin) Cen at 210 F 32Asphaltenes % Wt. 2Conradson Carbon R % Wt. 9Vanadium Parts/mill. 17

Year Of Crude Oil Sample: 1975 Nickel Parts/mill. 9


MUBARRAZ Abu Dhabi

Gravity: 39.5 Sulfur: 0.90 Loading Port: Mubarraz Island

Production

Output of 15,000 barrels a day comes from a group of small producing fields off the coastof Abu Dhabi, just south of the major producing center at Zakum.

Quality

Extra-light Mideast crude oil similar in quality to Murban, Abu Dhabi�s benchmark grade.

Producers

Abu Dhabi Oil Co.: Cosmo (66.7%) ; Japan Energy Corp. (Nikko Kyodo) (33.3%).


Complete Japanese ownership in this tiny field translates into shipments that movealmost exclusively to the owners. Pricing is internally generated but does take intoaccount spot Oman and Dubai grades as well as the Asian Petroleum Price Index.

Sellers

Cosmo Tokyo: Toshiba Building, 1-1 Shibaura 1-chome, Minatoku, Tokyo, Japan105. Tel.: (03) 3798-3211.

Cosmo New York: 280 Park Ave., New York, NY 10017. Tel.: (212) 949-9710.Cosmo London: 7 Old Park Lane, London W1Y 3LJ, UK. Tel.: (44-171) 629-3031, Fax:

(44-171) 491-3205.

Main Customers

The Japanese consortium rarely sells the barrels out of its own system. A few spot saleshave gone to other Japanese firms.

Loading Port

Mubarraz Island. 24.26 N. 53.32 E. The island is located approximately 55 miles westof the port of Abu Dhabi. Tank storage on the island accommodates 2.238-million bar-rels of crude oil. Facilities for crude oil loading include a single-buoy mooring systeminstalled about 8 miles offshore east of the island. The maximum loading rate is 40,000barrels an hour, or 6,400 kiloliters/hr.


MUBARRAZ ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.5 Sulfur Content % Weight 0.9Barrels /Metric Ton 7.64 Pour Point Temp. C -36Viscosity Centistokes 11.8 Reid Vapor Press. Lbs/Sq. In. 6.3(Kinematic) at 50 F


Cut Points YieldProduct Temp. C/F % Vol. Properties Unit ValueLPG <32/<90 0.8Light Naphtha 32-85 7.7 Light Naphtha

90-185 Octane RON Clear Octane 65.8Int. Naphtha 85-165 18.5 Intermediate Naphtha

185-329 Paraffins % Wt. 68.6Naphthenes % Wt. 19.4Aromatics % Wt. 12.6

Kerosine 165-235 15.8 Kerosine329-455 Sulfur Content % Wt. 0.08

Light Gas Oil 235-300 12.9 Light Gas Oil455-572 Sulfur Content % Wt. 0.9

Cloud Point Temp. C. -1Cetane Index 57

Int. Gas Oil 300-350 9.1 Intermediate Gas Oil572-662 Sulfur Content % Wt. 1.58

Cloud Point Temp. C. 10Cetane Index 55.9Viscosity (Kin) 100 F 6.4

Residue >350 35.2 Residue>662 Sulfur Content % Wt. 1.92

Pour Point Temp. C/F 27/80.6Viscosity (Kin) Cen at 140 F 78

Year Of Crude Oil Sample: 1994 Asphaltenes % Wt. 2.6


MURBAN Abu Dhabi

Gravity: 40.4 Sulfur: 0.79 Loading Port: Jebel DhannaOther Names: Abu Dhabi

Production

Murban�s output of 880,000-900,000 barrels a day comes from three main onshore fields:Bab, Bu Hasa, and Asab. Murban�s total capacity is 1.3-million b/d following the expan-sion of the Bab field in 1994, and it accounts for most of the emirate�s shut-in produc-tion. Other than the Sahil field, the Murban stream provides the only onshore produc-tion in Abu Dhabi. Murban is the largest crude oil stream in the country.

Quality

A typical extra-light Mideast crude oil that is prized for its relatively low sulfur content byMideast standards, large yield of middle distillates, and petrochemical-oriented naphtha cut.

Producers

Adco: State Adnoc (60%) , British Petroleum (9.5%) , Shell (9.5%) , Total (9.5%) , Exxon(4.75%) , Mobil (4.75%) , P&E (2%).


Abu Dhabi sets its crude prices retroactively, using published Dubai prices as a partialreference. Murban is the highest-priced Abu Dhabi export grade, selling at parity orslightly higher than Lower Zakum. It is marketed primarily in the Far East to a long listof Japanese term customers, which alone take some 500,000 b/d. However, many ofthese customers place Murban in the Mideast spot market, where five to 10 cargoes permonth are actively traded.

Sellers

Adnoc: P.O. Box 270, Abu Dhabi, United Arab Emirates. Tel.: (971-2) 666-100, Fax:(971-2) 669-785.

BP Oil International, Ltd.: Britannic House, 1 Finsbury Circus, London EC2M 7BA,UK, Tel.: (44-171) 496-4000.

Shell International Trading & Shipping (Stasco) : Shell Mex House, Strand,London WC2R 07A, UK, Tel.: (44-171) 546-1234, Fax: (44-171) 546-4448.

Total Petroleum Services, Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44-171) 935-3102.

Other equity producers.

Main Customers

Adnoc maintains at least 15 term customers for Murban, mostly in Japan and SouthKorea. The equity producers also regularly move volumes into their East of Suez refin-ing systems.

Loading Port

Jebel Dhanna. 24.13 N. 52.40 E. There are 3 conventional-buoy mooring (CBM) berthsat the crude oil terminal, each capable of accepting tankers up to 330,000 deadweighttons and 1,215 feet (370.3 meters) in length. Maximum loading rates range from 6,000-9,500 tons/hour. Acceptable draft ranges from 45-49 ft. The terminal also has a singlepoint mooring (SPM) that can accommodate vessels up to 450,000 dwt.


MURBAN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 40.4 Sulfur Content % Weight 0.79Barrels /Metric Ton 7.66 Pour Point Temp. F 0Viscosity Centistokes 2.9(Kinematic) at 40 C

REFINED PRODUCT BREAKDOWNS AND PROPERTIESCut Points Yield

Product Temp. F % Vol. Properties Unit ValueLPG 2.0Light Naphtha 55-175 8.2 Light Naphtha

Octane RON Clear Octane 64Int. Naphtha 175-300 15.4 Intermediate Naphtha

Paraffins % Wt. 64Naphthenes % Wt. 22Aromatics % Wt. 14

Heavy Naphtha 300-400 12.5 Heavy NaphthaParaffins % Wt. 55Naphthenes % Wt. 24Aromatics % Wt. 21

Kerosine 400-500 12.1 KerosineSulfur Content % Wt. 0.11Freezing Point Temp. F. -30

Gas Oil 500-650 16.6 Gas OilSulfur Content % Wt. 0.7Cetane Index 53Viscosity (Kin) 50 C 3.16

Residue >650 33.2 ResidueSulfur Content % Wt. 1.76Pour Point Temp. C/F 27/80

Year Of Crude Oil Sample: 1990 Viscosity (Kin) Cst at 50 C 41.2

MURBAN TERM CONTRACT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $24.95 $17.85 $16.42 $15.20 $19.20 $20.70 $17.25 $16.90 Feb. 16.65 17.92 15.92 15.45 18.20 16.10 17.50 17.90March 12.50 17.92 14.15 17.10 17.20 16.65 17.50 17.95April 11.30 17.92 15.52 18.00 15.45 17.15 18.50 17.85May 11.00 17.92 15.50 16.70 15.65 17.95 19.50 17.55June 11.00 17.92 14.40 16.35 14.30 17.60 21.00 17.25July 8.45 17.92 13.67 16.40 16.45 18.60 20.45 16.00Aug. 13.85 17.92 13.77 16.00 27.00 18.90 19.70 16.50Sept. 13.65 17.92 11.70 16.65 32.60 20.30 20.10 15.90Oct. 13.85 17.92 10.81 17.15 34.34 21.10 19.70 16.65Nov. 14.40 17.92 10.95 17.32 30.60 20.60 18.60 15.40Dec. 15.55 17.92 13.25 18.35 25.55 17.35 17.85 14.00

MURBAN SPOT PRICES, 1987-93Month 1987 1988 1989 1990 1991 1992 1993Jan. $17.65 $16.15 $15.25 $19.10 $21.70 $17.40 $17.20 Feb. 17.50 15.85 15.55 18.65 15.75 17.60 18.05March 17.55 13.90 16.95 17.25 15.95 17.40 18.45April 17.70 15.50 18.05 15.50 16.70 18.30 18.25May 17.70 15.45 16.75 15.50 17.60 19.25 17.80June 17.80 14.30 16.60 14.50 17.30 20.60 17.55July 18.10 13.65 16.45 16.60 18.45 20.05 16.50Aug. 17.85 13.70 15.85 25.80 18.95 19.40 16.70Sept. 17.50 12.20 16.50 31.75 20.05 20.15 16.05Oct. 17.60 10.80 17.10 34.00 21.35 20.00 16.70Nov. 17.40 11.15 17.25 30.70 20.60 18.80 15.85Dec. 16.35 13.25 18.55 25.70 17.65 18.05 14.25Note: More recent prices can be found in Chapter I.


THAMAMA CONDENSATE Abu Dhabi

Gravity: 57.5 Sulfur: 0.11 Loading Port: Jebel Dhanna

Production

A stream of condensate associated with the Thamama gas formations of the onshore Babfield. Following start-up in April of 1996, volumes were expected to rise to 130,000 bar-rels a day by year-end with total flows of 270,000 b/d expected when two further phas-es of development are completed.

Quality

A naphtha-oriented condensate that also produces a large amount of kerosine.

Producers

Adnoc by law owns all of the emirate�s gas resources and is managing the Thamamadevelopment on behalf of Adco, which operates the Bab field. Adco�s ownership is asfollows: State Adnoc (60%) , British Petroleum (9.5%) , Shell (9.5%) , Total (9.5%) , Exxon(4.75%) , Mobil (4.75%) , P&E (2%).


Adnoc plans to eventually refine all of the Thamama condensate at the nearby Ruwaisrefinery in order to maximize revenue, but until the plant is expanded to handle moreof the condensate, it is selling most of the production on the international market. As oflate 1996 it was in the process of lining up term customers. Most sales are expected togo to Asia, and Adnoc hopes to use a simple Murban-related pricing system, as with itsother term crude oil contracts.

Seller


Loading Port

Jebel Dhanna. 24.13 N. 52.40 E. There are 3 conventional-buoy mooring (CBM) berthsat the crude oil terminal, each capable of accepting tankers up to 330,000 deadweighttons and 1,215 feet (370.3 meters) in length. Maximum loading rates range from 6,000-9,500 tons/hour. Acceptable draft ranges from 45-49 ft. The terminal also has a singlepoint mooring (SPM) that can accommodate vessels up to 450,000 dwt.


THAMAMA CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 57.5 Sulfur Content % Weight 0.11Barrels /Metric Ton 8.42 Pour Point Temp. F -39Viscosity Centistokes 0.76 Reid Vapor Press. kg/cm2 4.8(Kinematic) at 40 C


Cut Points YieldProduct Temp. C % Vol. % Wt.LPG 1.04 1.02Naphtha <150 56.46 52.69Kerosine 150-250 25.04 26.51Gas Oil 250-395 14.58 16.31Residue >395 2.93 3.47Year Of Crude Oil Sample: 1996


UMM SHAIF Abu Dhabi

Gravity: 36.8 Sulfur: 1.38 Loading Port: Das Island

Production

About 180,000-200,000 barrels a day is produced from these offshore fields out of totalcapacity of 220,000 b/d. Capacity is due to rise to about 300,000 b/d shortly after 2000.Umm Shaif is tied in with the 20,000 b/d Al-Bunduq field production, which is slightlyhigher in quality.

Quality

A light to extra-light Mideast crude oil slightly inferior in quality to Abu Dhabi bench-mark grade Murban. Although the assay below is dated, it is still broadly representativeof the crude oil�s current quality.

Producers

Adma-Opco: State Adnoc (60%) , British Petroleum (14.66%) , Total (13.33%) , Jodco(12%).


Umm Shaif is exported almost exclusively to Japan, which imported 175,000 b/d in 1995.Prices are set retroactively every month by Adnoc, using the spot Dubai market as arough guide.

Sellers


BP Oil International, Ltd.: Britannic House, 1 Finsbury Circus, London EC2M 7BA,UK. Tel.: (44-171) 496-4000.

Total Petroleum Services, Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44-171) 935-3222, Fax: (44-171) 935-3102.

Main Customers

Each of the sellers listed above markets barrels, which end up mainly with refiners inJapan. There are relatively few sales to Singapore and South Korea.

Loading Port

Das Island. 25.09 N. 52.52 E. Located approximately 100 miles northwest of the city ofAbu Dhabi, the port has two crude oil-loading berths. Berth 2 is a fixed-platform berthlocated approximately 2,400 feet (750 meters) east of Das Island, with the capability ofserving vessels up to 265,000 deadweight tons. Berth 3 is a single-point mooring (SPM)located approximately 7,500 ft (2,285 m) east of Das Island, with a maximum berthingdraft of 72 ft (22 m) and maximum vessel size of 410,000 dwt. Total crude oil storageamounts to 8.9-million barrels in 15 tanks. There are plans to expand the terminal dueto rising output capacity.


UMM SHAIF ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.8 Sulfur Content % Weight 1.38Barrels /Metric Ton 7.448 Pour Point Temp. C -15Viscosity Centistokes 7.488 Reid Vapor Press. Lbs/Sq. In. 6.2(Kinematic) at 10 C Hydrogen Sulfide Parts/mill. 20


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <32/<90 3 2Light Naphtha 32-85 8.8 7 Light Naphtha




Light Gas Oil 235-300 12.3 12.3 Light Gas Oil455-572 Sulfur Content % Wt. 0.6

Cloud Point Temp. C. -21Cetane Index 53

Int. Gas Oil 300-350 9 9.2 Intermediate Gas Oil572-662 Sulfur Content % Wt. 1.59

Cloud Point Temp. C. 4Cetane Index 55.5Viscosity (Kin) 100 F 5.81


Pour Point Temp. C/F 30/86Viscosity (Kin) Cen at 120 F 101Asphaltenes % Wt. 0.16Conradson Carbon R % Wt. 5.2Vanadium Parts/mill. 4

Year Of Crude Oil Sample: 1969 Nickel Parts/mill. <1

UMM SHAIF TERM CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.04 $13.78 $29.36 $36.36 $35.30 $34.36 $29.36 $29.11 Feb. 13.04 14.62 29.36 36.36 35.30 34.36 29.36 28.05March 13.04 14.62 29.36 36.36 34.36 29.36 29.36 28.05April 13.04 16.88 29.36 36.36 34.36 29.36 29.36 28.05May 13.04 17.68 31.36 36.36 34.36 29.36 29.36 28.05June 13.04 17.68 31.36 36.36 34.36 29.36 29.36 28.05July 13.04 21.36 31.36 36.36 34.36 29.36 29.36 28.05Aug. 13.04 21.36 31.36 36.36 34.36 29.36 29.36 28.05Sept. 13.04 21.36 33.36 36.36 34.36 29.36 29.36 28.05Oct. 13.04 21.36 33.36 36.36 34.36 29.36 29.36 28.05Nov. 13.04 27.36 33.36 35.50 34.36 29.36 29.36 28.05Dec. 12.65 27.36 33.36 35.50 34.36 29.36 29.36 28.05Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $24.75 $17.65 $16.22 $14.89 $18.75 $20.40 $16.95 $16.55 Feb. 16.40 17.72 15.72 15.15 17.80 15.80 17.20 17.55March 12.25 17.72 13.85 16.83 16.85 16.35 17.20 17.55April 11.05 17.72 15.25 17.73 15.10 16.85 18.20 17.45May 12.10 17.72 15.25 16.35 15.30 17.65 19.20 17.15June 10.75 17.72 14.12 16.00 13.95 17.30 20.70 16.85July 8.25 17.72 13.36 16.07 15.10 18.30 20.15 15.60Aug. 13.65 17.72 13.50 15.65 26.80 18.60 19.40 16.10Sept. 13.40 17.72 11.47 16.27 32.25 20.00 19.80 15.50Oct. 13.60 17.72 10.54 16.77 33.95 20.80 19.40 16.25Nov. 14.20 17.72 10.65 16.94 30.25 20.30 18.30 15.00Dec. 15.35 17.72 12.92 17.95 25.35 17.05 17.55 13.55Note: More recent prices can be found in Chapter I.


UPPER ZAKUM Abu Dhabi

Gravity: 32.9 Sulfur: 1.78 Loading Port: Das Island

Production

Output is 450,000-470,000 barrels a day, with the upper limit reflecting full capacity,which is due to reach 500,000 b/d in 1997 as part of an ongoing expansion program.With reserves of 48-billion barrels, offshore Upper Zakum is Abu Dhabi�s largest field,although Murban output is higher, due in part to Upper Zakum�s relatively high pro-duction costs by Mideast standards.

Quality

A mid-grade Mideast sour crude oil that yields a generous middle distillate cut.

Producers

Zadco: State Adnoc (88%) , Jodco (12%). Operated by Total under a long-term servicecontract.


If not refined in Abu Dhabi, Upper Zakum is almost exclusively sold in the Far East, withJapan importing 240,000 b/d in 1995. Most Upper Zakum is sold on term contracts, mak-ing it one of Abu Dhabi�s least-traded spot crude oils. Term-contract prices are setretroactively every month by Adnoc, using the spot Dubai market as a rough guide.

Sellers



Main Customers

Nippon Refining is the largest single user of Upper Zakum. It is also widely usedthroughout the Japanese refining community, as well as in South Korea and Singapore.

Loading Port

Das Island. 25.09 N. 52.52 E. Located approximately 100 miles northwest of the city ofAbu Dhabi, the port has two crude oil-loading berths. Berth 2 is a fixed-platform berthlocated approximately 2,400 feet (750 meters) east of Das Island, with capability of serv-ing vessels up to 265,000 deadweight tons. Berth 3 is a single-point mooring (SPM) locat-ed approximately 7,500 ft (2,285 m) east of Das Island, with a maximum berthing draftof 72 ft (22 m) and maximum vessel size of 410,000 dwt. Total crude oil storage amountsto 8.9-million barrels in 15 tanks. There are plans to expand the terminal due to risingoutput capacity.


UPPER ZAKUM ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.9 Sulfur Content % Weight 1.78Barrels /Metric Ton 7.32 Pour Point Temp. C -9Viscosity Centistokes 17.7 Reid Vapor Press. Lbs/Sq. In. 5.6(Kinematic) at 10 C







Cloud Point Temp. C. -27Cetane Index 53.4

Int. Gas Oil 300-350 9.0 9.0 Intermediate Gas Oil572-662 Sulfur Content % Wt. 1.63

Cloud Point Temp. C. 3Cetane Index 55.5Viscosity (Kin) 40 C 5.44


Pour Point Temp. C/F 18/64.4Viscosity (Kin) Cen at 60 C 153Asphaltenes % Wt. 3.7Conradson Carbon R % Wt. 9.3Vanadium Parts/mill. 12



ZAKUM Abu Dhabi

Gravity: 39.2 Sulfur: 1.10 Loading Port: Das IslandOther Names: Lower Zakum

Production

Output from this offshore field is about 240,000-250,000 barrels a day with total capaci-ty of 280,000. Sustainable capacity is due to rise to 320,000 b/d in the future. All associ-ated gas goes to the Das Island LNG plant.

Quality

Extra-light Mideast crude oil similar in quality to Abu Dhabi benchmark Murban.

Producers

Adma-Opco: State Adnoc (60%) , British Petroleum (14.66%) , Total (13.33%) , Jodco(12%).


Zakum is almost exclusively sold into the Far East under term contracts. Japanese refin-ers control 85%-90% of purchase volumes, but they have been known to trade Zakumoutside Japan on occasion. Japan imported 217,000 b/d in 1995. Prices are set monthlyon a retroactive basis by Adnoc using the spot Dubai market as the main reference level.

Sellers


BP Oil International, Ltd.: Britannic House, 1 Finsbury Circus, London EC2M 7BA,UK. Tel.: (44-171) 496-4000.


Main Customers

Japanese Idemitsu and Nippon Oil are the largest buyers, although Zakum is purchasedby at least 10 other refineries in Japan.

Loading Port

Das Island. 25.09 N. 52.52 E. Located approximately 100 miles northwest of the city ofAbu Dhabi, the port has two crude oil-loading berths. Berth 2 is a fixed-platform berthlocated approximately 2,400 feet (750 meters) east of Das Island, with capability of serv-ing vessels up to 265,000 deadweight tons. Berth 3 is a single-point mooring (SPM) locat-ed approximately 7,500 ft (2,285 m) east of Das Island, with a maximum berthing draftof 72 ft (22 m) and maximum vessel size of 410,000 dwt. Total crude oil storage amountsto 8.9-million barrels in 15 tanks. There are plans to expand the terminal due to risingoutput capacity.


ZAKUM ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.2 Sulfur Content % Weight 1.1Barrels /Metric Ton 7.597 Pour Point Temp. C <-38Viscosity Centistokes 5.61 Reid Vapor Press. Lbs/Sq. In. 7.8(Kinematic) at 10 C Hydrogen Sulfide Parts/mill. <3


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <32/<90 3.7 2.5Light Naphtha 32-85 10.2 8.2 Light Naphtha

90-185 Octane RON Clear Octane 72Int. Naphtha 85-165 17 15.4 Intermediate Naphtha



Light Gas Oil 235-300 13 13.1 Light Gas Oil455-572 Sulfur Content % Wt. 0.5

Cloud Point Temp. C. -20Cetane Index 54.7


Cloud Point Temp. C. 4Cetane Index 55.1Viscosity (Kin) 50 C 4.1


Pour Point Temp. C/F 18/64.4Viscosity (Kin) Cen at 50 C 94.9Asphaltenes % Wt. <0.05Conradson Carbon R % Wt. 6.1Vanadium Parts/mill. 4


ZAKUM TERM CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. 13.17 14.01 29.46 36.46 35.40 34.46 29.46 29.21Feb. 13.17 15.03 29.46 36.46 35.40 34.46 29.46 28.10March 13.17 15.03 29.46 36.46 34.46 29.46 29.46 28.10April 13.17 17.01 29.46 36.46 34.46 29.46 29.46 28.10May 13.17 17.81 31.46 36.46 34.46 29.46 29.46 28.10June 13.17 17.81 31.46 36.46 34.46 29.46 29.46 28.10July 13.17 21.46 31.46 36.46 34.46 29.46 29.46 28.10Aug. 13.17 21.46 31.46 36.46 34.46 29.46 29.46 28.10Sept. 13.17 21.46 33.46 36.46 34.46 29.46 29.46 28.10Oct. 13.17 21.46 33.46 36.46 34.46 29.46 29.46 28.10Nov. 13.17 27.46 33.46 35.60 34.46 29.46 29.46 28.10Dec. 13.08 27.46 33.46 35.60 34.46 29.46 29.46 28.10Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. 24.85 17.75 16.32 14.97 18.95 20.55 17.15 16.80Feb. 16.50 17.82 15.82 15.23 17.95 15.95 17.40 17.80March 12.35 17.82 13.95 16.90 17.00 16.50 17.40 17.85April 11.15 17.82 15.32 17.80 15.25 17.05 18.40 17.75May ... 17.82 15.30 16.45 15.45 17.85 19.40 17.45June ... 17.82 14.17 16.10 14.10 17.50 20.90 17.15July ... 17.82 13.42 16.15 16.25 18.50 20.35 15.90Aug. 13.75 17.82 13.58 15.75 26.65 18.80 19.60 16.40Sept. 13.50 17.82 11.55 16.40 32.40 20.20 20.00 15.80Oct. 13.75 17.82 10.61 16.90 34.10 21.00 19.60 16.55Nov. 14.30 17.82 10.73 17.07 30.40 20.50 18.50 15.30Dec. 15.45 17.82 13.00 18.10 25.20 17.25 17.75 13.90Note: More recent prices can be found in Chapter I.


ALGERIAN CONDENSATE Algeria

Gravity: 64.6 Sulfur: <0.01 Loading Port: Arzew

Production

State Sonatrach is the sole producer of some 300,000 barrels a day, all of which comesin association with gas production and is used almost entirely for export. Much of thegas is reinjected after the liquids are stripped out, but volumes have been in decline dueto the decreasing proportion of wet gas in total gas output.

Quality

A naphtha-oriented condensate that produces large amounts of paraffinic naphtha instraight distillation, making it an excellent petrochemical feedstock.


Sold to the US, Brazil, and Europe mainly for petrochemical manufacturing. Prices arebased on monthly negotiations and are usually tied to Rotterdam refined product mar-kets, less a discount that is related to freight and quality. Almost all sales are on a term-contract basis. About 20-25 cargoes are exported per month, usually carrying 425,000tons each, with the US Gulf Coast absorbing about half of them. Sonatrach handles allsales directly through its marketing department, but volumes are also sometimes avail-able from an independent trading affiliate, Sonatrach Petroleum Corp.

Sellers

Sonatrach: Liquid Hydrocarbon Marketing Department, 46 Boulevard Mohamed V,Algiers, Algeria. Tel.: (213-2) 71-12-24, Fax: (213-2) 64-50-58, Telex: 62388 DZ.

Main Customers

Petrobras, Lyondell, Dow Chemical, OMV, and US Shell are among the regular term-con-tract customers.

Loading Port

Arzew. 35.50 N. 00.08 W. Arzew is located on the Algerian coastline about 200 mileswest of Algiers and consists of the ports of Arzew and Arzew El Djedid. There are threecrude oil or condensate loading berths at Arzew, with capacities from 50,000-120,000deadweight tons. Arzew El Djedid has three crude oil-loading berths with maximum ves-sel size of 250,000 dwt. The port is prone to closure from storms, particularly in Januaryand February.


ALGERIAN CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 64.6 Sulfur Content % Weight <0.01Barrels /Metric Ton 8.724 Pour Point Temp. C 7Viscosity Centistokes 0.91 Reid Vapor Press. Lbs/Sq. In. 8.6(Kinematic) at 10 C





Kerosine 165-235 17.5 18.9 Kerosine329-455 Sulfur Content % Wt. <0.01

Freezing Point Temp. C -56Light Gas Oil 235-300 8.5 9.6 Light Gas Oil

455-572 Sulfur Content % Wt. <0.01Cloud Point Temp. C -24Cetane Index 64.6


Cloud Point Temp. C 6Cetane Index 66.1

Year Of Crude Oil Sample: 1982 Viscosity (Kin) 40 C 7.57

ALGERIAN CONDENSATE TERM CONTRACT PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $14.20 $14.75 $36.00 $41.00 $36.00 $31.00 $27.50 $25.00 Feb. 14.20 14.75 37.21 41.00 33.00 31.00 28.25 25.00March 14.20 14.75 37.21 41.00 35.50 30.50 28.25 29.50April 14.05 21.54 37.21 39.00 30.00 28.00 28.50 26.89May 14.05 20.95 39.21 39.00 30.00 29.00 28.50 26.89June 14.05 20.95 39.21 39.00 33.00 29.00 28.50 26.89July 14.05 24.00 40.00 35.50 33.00 29.75 27.50 26.89Aug. 14.05 24.00 40.00 35.50 31.50 29.75 26.00 26.55Sept. 14.05 24.00 37.00 35.50 31.50 30.25 26.65 26.55Oct. 14.05 26.22 37.50 35.50 32.50 30.00 27.00 27.46Nov. 14.05 26.22 37.50 36.70 32.50 29.25 26.50 27.46Dec. 14.05 30.40 37.50 36.70 32.50 28.50 25.00 27.23Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $25.17 $17.50 $16.25 $16.65 $19.90 $25.45 $18.85 $18.85 Feb. 25.17 16.15 15.85 16.15 19.50 20.25 19.05 18.83March 13.50 17.25 14.90 17.60 18.05 20.05 18.95 18.97April 13.25 18.10 16.45 18.50 16.55 20.10 20.25 20.45May 14.55 17.40 16.90 17.85 15.95 20.70 21.00 19.33June 12.00 18.40 15.75 18.00 15.00 19.75 20.86 19.36July 9.55 19.00 14.55 16.95 17.00 20.20 21.03 18.71Aug. 11.80 17.25 14.40 15.50 28.60 19.85 20.50 18.61Sept. 12.60 17.10 13.60 17.05 36.20 19.00 20.75 17.58Oct. 12.45 17.80 12.65 16.35 35.46 21.05 21.59 18.04Nov. 13.00 16.95 13.40 17.35 32.60 23.45 19.96 15.32Dec. 13.85 15.60 14.65 19.00 28.55 19.60 18.78 14.81Note: More recent prices can be found in Chapter I.


SAHARAN BLEND Algeria

Gravity: 46.1 Sulfur: 0.11 Loading Ports: Arzew, Bejaia, SkikdaOther Names: Saharan, Arzew, Hassi-Messaoud

Production

About 700,000 barrels a day produced by state Sonatrach mainly from the mature Hassi-Messaoud field and others mostly to the south. This production is growing and is likelyto reach 800,000 b/d or so in 1997 due to new capacity being brought on stream by inter-national oil companies, including Italian Agip, Spanish Cepsa, Petro-Canada, USAnadarko.

Quality

An extremely light, low-sulfur crude oil that is rich in gasoline.


Sold to Europe and the US, with Italy and Spain the primary markets. Term-contractprices are set according to formulas tied to dated Brent with a premium. Sonatrach han-dles most sales directly through its marketing department, but volumes are also some-times available from an independent trading affiliate, Sonatrach Petroleum Corp., whichwas established in the early 1990s to trade oil in the spot market. International equityproducers have rights to market 20%-25% of their production directly, but they have notyet emerged as significant third-party sellers. Saharan Blend is also the primary feedstockfor domestic refineries, which take about 350,000 b/d.

Sellers


Also, Agip, Cepsa, Petro-Canada, and Anadarko.

Main Customers

Mobil, Exxon, British Petroleum, Shell, Total, Ultramar, Elf, and OMV.

Loading Ports

Arzew. 35.50 N. 00.08 W. Arzew is located on the Algerian coastline about 200 mileswest of Algiers and consists of the ports of Arzew and Arzew El Djedid. There are threecrude oil-loading berths at Arzew, with capacities from 50,000-100,000 deadweight tons.Arzew El Djedid has three crude oil-loading berths with maximum size ranging to250,000 dwt. The port is prone to closure from storms, particularly in January andFebruary.Bejaia. 36.45 N. 05.05 E. Bejaia, located about 100 miles east of Algiers, has three crudeoil-loading piers. The maximum drafts are 11.5 meters for Pier 1, 12.5 m for Pier 2, and13 m for Pier 3.Skikda. 36.53 N. 6.54 E. Maximum draft for tankers is the following at New Port: NP 1& 2, 12.8 m; NP 3, 14.8 m; NP 5, 10.5 m; A1, 10.5 m; M1, 11 m; M2, 12 m.


SAHARAN BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 46.1 Sulfur Content % Weight 0.11Barrels /Metric Ton 7.902 Pour Point Temp. C <-36Viscosity Centistokes 2.1 Reid Vapor Press. Lbs/Sq. In. 11.6(Kinematic) at 10 C


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <32/<90 5.3 3.8Light Naphtha 32-85 14.4 12.1 Light Naphtha





Cloud Point Temp. C -24Cetane Index 53.8


Cloud Point Temp. C -2Cetane Index 56.7Viscosity (Kin) Cen at 40 C 6.09


Pour Point Temp. C/F 24/75.2Viscosity (Kin) Cen at 60 C 43.9Asphaltenes % Wt. 0.28Conradson Carbon R % Wt. 3.1Vanadium Parts/mill. <1


SAHARAN BLEND PRICES, 1978-93At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $14.25 $14.81 $33.00 $40.00 $37.00 $37.30 $30.95 $30.95 Feb. 14.25 14.81 37.21 41.60 37.00 31.50 30.95 28.65March 14.25 16.56 36.10 41.60 35.50 30.50 30.95 29.50April 14.10 18.55 36.10 41.60 37.30 30.50 30.95 29.50May 14.10 21.00 38.21 40.60 37.30 30.50 30.95 29.50June 14.10 21.40 38.10 39.90 37.30 30.50 30.95 29.50July 14.10 23.50 40.00 37.90 37.30 30.50 30.95 27.90Aug. 14.10 23.50 40.00 37.90 37.30 30.50 30.95 27.90Sept. 14.10 23.50 37.00 37.90 37.30 30.50 30.95 27.90Oct. 14.30 26.27 37.00 37.90 37.30 30.95 30.95 27.90Nov. 14.30 27.50 37.00 37.50 37.30 30.95 30.95 27.90Dec. 14.30 30.45 38.60 37.50 37.30 30.95 30.95 27.90Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $27.90 $18.45 $16.75 $17.50 $21.65 $24.85 $19.25 $17.80 Feb. 23.90 18.87 15.70 17.30 20.20 21.05 19.30 18.90March 23.90 18.87 14.80 19.05 18.65 20.45 18.45 19.10April 23.90 18.87 16.70 20.60 16.75 19.85 19.60 19.05May 13.80 18.87 16.55 19.05 16.60 19.65 20.50 18.85June 11.90 18.87 15.75 17.90 15.10 18.70 21.55 17.70July 9.45 18.87 15.30 17.90 17.25 20.05 20.70 17.30Aug. 13.65 18.87 15.05 16.95 27.75 20.45 20.20 17.35Sept. 14.20 18.87 13.50 17.90 36.45 21.45 20.65 16.60Oct. 13.80 18.87 12.70 19.15 37.80 23.35 20.95 17.10Nov. 14.50 18.87 13.25 19.05 34.40 22.35 19.95 15.80Dec. 15.85 18.87 15.70 20.15 29.50 19.50 18.95 14.20Note: Spot prices from 2/86-2/87, and from 1/88 to present. Others are term-contract prices. Note: More recentprices can be found in Chapter I.


ZARZAITINE Algeria

Gravity: 42.8 Sulfur: 0.06 Loading Port: La Skhirra (Tunisia) Other Names: Zarzatine, El Borma

Production

Declining output of less than 100,000 barrels a day by state Sonatrach, partly from the ElBorma field that straddles the border with Tunisia and from the Zarzaitine field furthersouth.

Quality

A high-quality North African light, sweet crude oil similar to Algerian benchmark gradeSaharan Blend.


Although the crude oil stream is produced mainly in Algeria, it is sold from the Tunisianport of La Skhirra to save on pipeline-transport costs to Algerian ports. Only about 20,000b/d of the Tunisian share of production is exported, and Algeria only sells an estimated50,000 b/d internationally. The crude oil is sold to European customers, with Italy themain market. It is usually priced in relation to dated Brent. Sonatrach handles salesdirectly through its marketing department.

Seller


Loading Port

La Skhirra, Tunisia. 34.14 N. 10.04 E. Two loading berths are available, one on eachside of the terminal. Depth at loading berths is 15-16 meters. The loading platform isserved by three 30-inch oil pipelines. The maximum loading rate is 12,000 cubic m anhour. Maximum size accommodated is 300 m length, 47 feet 6 in draft, or up to 50 ft athigh water. The crude oil terminal has 1.9-million barrels of storage capacity and PaktankMediterranee operates a near independent storage terminal for refined products.


ZARZAITINE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 42.8 Sulfur Content % Volume 0.06Barrels /Metric Ton 7.76 Pour Point Temp. F 10Viscosity Centistokes 2.9 Reid Vapor Press. Lbs/Sq. In. 9(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 2.7Light Naphtha 55-175 9.5 Light Naphtha





Gas Oil 500-650 15 Gas OilSulfur Content % Wt. 0.04Cetane Index 55Viscosity (Kin) 50 C 3.9

Residue >650 33.8 ResidueSulfur Content % Wt. 0.18

Year Of Crude Oil Sample: 1984 Pour Point Temp. F 65


CABINDA Angola

Gravity: 32.0 Sulfur: 0.13 Loading Port: CabindaOther Names: Malongo, Takula

Production

Output of 390,000 barrels a day in 1995, rising to 430,000 b/d in 1996 and 450,000 b/d in1998. Produced from two mainly offshore systems in the Cabinda enclave: Malongo andTakula. The two grades had been treated separately before commingling in May 1992.

Quality

Medium gravity, low-sulfur West African crude oil with high wax content. Malongo,which is shown in the assay below, is slightly heavier and higher in sulfur than theTakula stream or the now-commingled blend. The quality differential between the twowas minor, typically only 5¢ a barrel. Takula is a 32.5-gravity stream with sulfur contentof 0.11%, kinematic viscosity at 40 degrees centigrade of 13.9 centistokes, and pour pointof 10 degrees centigrade. The crude oil�s high wax content makes it solidify at tempera-tures below 13-16 degrees centigrade and restricts sales destinations to warm seas orports with heated tankage.

Producers

State Sonangol has a majority stake with partners Chevron (operator) , Elf, and Agip.Volumes in 1995 were about as follows: Sonangol 160,000 b/d; Chevron 152,000 b/d; Elf39,000 b/d; and Agip 39,000 b/d.


Sonangol has sold most of its share of production under term contracts with prices seton a cargo-by-cargo basis and tied to spot prices of UK Brent Blend, with about two-thirds moving to the US. Chevron and Agip tend to keep their crude oil within their ownsystems with only occasional spot sales. The oil increasingly moves to the Far East if arbi-trage opportunities exist and both Taiwan�s CPC and South Korean Hanwha are amongAsian refiners that now have term contracts. Key term customers include BritishPetroleum, Elf, Exxon, Petrobras, Coastal, and Glencore. Regular spot buyers include USrefiners Sun and Tosco.

Sellers

Sonangol: Rua I Congresso do MPLA, C.P. 113, Luanda, Angola. Tel.: (244-2) 392-643/392-595, Telex: 3148 SONONGAN.

Chevron (UK) Ltd.: c/o Mail Centre, 2 Portman St., London W1H 0AN, UK. Tel.: (44-171) 487-8100, Fax: (44-171) 487-8142.

Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-921, Fax: (39-6)503-922-41/503-923-20.

Elf Trading S.A.: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.: (41-22)710-1112, Fax: (41-22) 710-1110.

Loading Port

Cabinda. 05.32 S. 12.11 E. The facilities at Cabinda provide for deep-water loading ofcrude oil at two single-buoy moorings, Berth M (Malongo) and Berth T (Takula) , 30 milesaway. Berth M was expanded in 1992 to handle VLCCs, and it became the primary load-ing facility following the commingling of the Takula and Malongo crude oil streams.


CABINDA (MALONGO) ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31.4 Sulfur Content % Weight 0.17Barrels /Metric Ton 7.247 Pour Point Temp. C 21Viscosity Centistokes 17.5 Reid Vapor Press. Lbs/Sq. In. 4.5(Kinematic) at 40 C









Cloud Point Temp. C 4Cetane Index 58.7Viscosity (Kin) Cen at 40 C 5.92


Pour Point Temp. C/F 39/102.2Viscosity (Kin) Cen at 100 C 34Asphaltenes % Wt. 0.2Vanadium Parts/mill. 4


CABINDA SPOT PRICES, 1986-93

At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $25.15 $17.55 $15.25 $15.40 $19.35 $22.05 $16.55 $15.80 Feb. 16.65 16.10 14.15 15.05 18.30 17.80 16.50 17.15March 11.65 16.70 13.15 17.10 16.85 17.85 16.05 17.45April 11.20 17.00 15.00 18.15 15.15 17.65 17.40 17.70May 12.45 17.65 14.80 16.75 15.10 17.70 18.40 17.60June 10.00 17.80 13.95 15.90 14.10 16.60 19.65 16.52July 7.75 18.80 13.30 16.15 15.95 17.40 18.75 15.55Aug. 11.95 18.05 13.35 15.50 25.45 18.15 18.20 15.40Sept. 12.45 17.10 11.70 16.20 32.50 18.85 18.90 14.75Oct. 12.80 17.60 10.85 17.40 34.45 20.55 19.00 15.35Nov. 13.50 16.50 11.40 17.55 31.40 19.70 18.00 13.65Dec. 14.85 15.70 13.55 18.25 26.40 16.75 16.90 12.05Note: More recent prices can be found in Chapter I.


PALANCA Angola

Gravity: 38.6 Sulfur: 0.14 Loading Port: Palanca

Production

A combination of offshore fields south of the Soyo field that are operated by Elf, pro-ducing 175,000 barrels a day in 1996 and expected to rise to 190,000 b/d. In addition toPalanca itself, which is now mature, the other adjacent fields include Cobo, Oombe, andPambi, which are providing a second production peak.

Quality

Lighter than Cabinda with a lower wax content and lower pour point. The crude oil alsofeatures a high N+A naphtha that is good for gasoline manufacturing.

Producers

Elf holds a 50% interest in the fields, with other holdings varying by field among stateSonangol, INA (Croatia) , Naftagas (Serbia) , Agip, Repsol, Svenska, and Mitsubishi.


Palanca is sold using a dated Brent-related formula, usually with a slight premium to theNorth Sea benchmark grade. Export volumes flow mainly toward the Atlantic Basin, butincreasing sales have been made to the Asia-Pacific region. Asian customers includeTaiwan�s state CPC and Thailand�s state PTT.

Sellers



Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-921, Fax: (39-6)503-922-41/503-923-20.

Loading Port

Palanca. 06.57S. 12.24E. The terminal is located at the offshore Palanca field some 230km northwest of Luanda. It consists of a single loading point mooring that is suppliedby a 274,000 deadweight tons floating storage vessel that gathers all of the production.Tankers from 40,000 to 280,000 dwt can be accommodated.


PALANCA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 38.6 Sulfur Content % Weight 0.14Barrels /Metric Ton 7.57 Pour Point Temp. F 35Viscosity Centistokes 3.6(Kinematic) at 40 C








Residue >650 37.6 ResidueSulfur Content % Wt. 0.25Pour Point Temp. F 68



SOYO Angola

Gravity: 39.5 Sulfur: 0.12 Loading Port: Quinfuquena

Production

A combination of onshore and offshore flows totaled 90,000-100,000 barrels a day fromnorthern Angola in mid-1996, with volumes expected to rise to about 120,000-130,000b/d in 1997 with full restoration of onshore production of 30,000 b/d, which was shut-down due to the civil war. Texaco produces 90,000 b/d offshore, with Essungo andLombo East the largest of the fields but several small new fields raising total volumes.Petrofina is the onshore operator.

Quality

Similar to Palanca with low sulfur content and relatively light compared to Cabinda. Theassay below is for the offshore production. Onshore output is a bit heavier, which shoulddegrade the quality of the stream as it picks up in 1996-97.

Producers

Braspetro (27.5%) , Total (27.5%) , Sonangol (25%) , and Texaco (20%) hold the offshoreconcession. Petrofina (32.6%) , Texaco (16.4%) , and Sonangol (51%) hold the onshorearea.


Soyo is sold using a dated Brent-related formula, with volumes mainly flowing towardthe Atlantic Basin, but sales have also grown to the Asia-Pacific region. Texaco andSonangol are the largest spot sellers of Soyo, while the other equity partners tend to usetheir shares within their systems.

Sellers


Texaco Oil Trading Co.: 1 Knightsbridge Green, London SW1X 7QJ, UK. Tel.: (44-171) 584-5000, Fax: (44-171) 589-2877.

Loading Port

Quinfuquena. 06.20 S. 12.14 E. The terminal is 15 miles south of the mouth of the ZaireRiver, about 7.5 nautical miles offshore. It consists of two loading points. The first is aready-made dolphin in about 72 feet of water at Lat. 6 19� 45� S., Long. 12 14� 42� E.Maximum draft is 47 ft and maximum cargo size is 104,500 tons. The second is a single-point mooring in 120 ft of water at Lat. 6 20� 18� S., Long. 12 09� 48� E. It takes tankersup to 250,000 deadweight tons. The onshore terminal was destroyed in the civil war andis unlikely to be rebuilt.


SOYO ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.5 Sulfur Content % Weight 0.115Barrels /Metric Ton 7.615 Pour Point Temp. F 30Viscosity Centistokes 6.4 Reid Vapor Press. Lbs/Sq. In. 5.5(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. % Wt. Properties Unit ValueLPG 2.7 1.8Light Naphtha To 180 5.9 4.8 Light Naphtha

Octane RON Clear Octane 69.6Int. Naphtha 180-265 8.2 7.6 Intermediate Naphtha


Heavy Naphtha 265-350 9.6 9.1 Heavy NaphthaParaffins % Wt. 50Naphthenes % Wt. 28Aromatics % Wt. 22

Light Kerosine 350-425 7.2 7 Light KerosineSulfur Content % Wt. 0.02Freeze Point F -50

Heavy Kerosine 425-500 9.3 9.2 Heavy KerosineSulfur Content % Wt. 0.03Freeze Point F -25

Gas Oil 500-650 15.9 16.1 Gas OilCloud Point Temp. F 26Cetane Index 62Sulfur Content % Wt. 0.08

Residue >650 41.2 44.6 ResidueSulfur Content % Wt. 0.24

Year Of Crude Oil Sample: 1993 Pour Point Temp. C/F 39/102.2


CANADON SECO Argentina

Gravity: 25.7 Sulfur: 0.20 Loading Ports: Celeta Olivia, Celeta Cordova

Production

Canadon Seco is produced from long-established onshore fields in the province of SantaCruz, which is in the southern Patagonian region. The key producing area is the SanJorge Basin, which contains about 25% of the country�s proven reserves. Some fieldsfrom the extreme south also feed into Canadon Seco. Exports in 1996 were just under90,000 b/d, making it Argentina�s second most plentiful grade behind Rincon.

Quality

A medium- to heavy-gravity, low-sulfur Latin American crude oil with a relatively highwax content.

Producers

In addition to former state YPF, which is the primary exporter, local independents Astraand Perez Companc are producers and sellers of the crude oil.


Usually sold on an f.o.b. basis from Argentina at prices linked to US West TexasIntermediate grade. In the autumn of 1996, the discount to WTI was running at about$2.50 a barrel, up from 1994-95 levels. Exports in 1996 had risen to 87,000 b/d, up from75,000 b/d in 1995 and 50,000 b/d in 1994, with most supplies going to Brazil, Chile, andthe US Gulf Coast. Traders play an active role in the marketing of the crude oil.

Sellers

YPF: 777 Avenue Pte. Roque Saenz Pena, Buenos Aires, Argentina. Tel.: (541) 329-2000. Fax: (541) 326-0641.

Loading Ports

Celeta Olivia. 46.26 S. 67.31 W. A crude oil-loading terminal located on the coast of thesouth Atlantic, about 1,000 miles south of Buenos Aires, on the San Jorge Gulf, in theport area of Comodoro Rivadavia. The oil terminal consists of two offshore tanker berthsand a single-buoy mooring at a depth of 22 meters. It is capable of handling vessels upto 150,000 deadweight tons.Celeta Cordova. 45.46 S. 67.22 W. A crude oil-loading terminal located on the coast ofthe south Atlantic, about 1,000 miles south of Buenos Aires, on the San Jorge Gulf, inthe port area of Comodoro Rivadavia. The oil terminal consists of an offshore tankerberth at a depth of 43 feet.


CANADON SECO ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 25.7 Sulfur Content % Weight 0.2Barrels /Metric Ton 7 Pour Point Temp. C -0.3Viscosity Centistokes 99.4 Reid Vapor Press. Lbs/Sq. In. 1.51(Kinematic) at 20/40 C Wax Content % Weight 9.8


Cut Points YieldProduct Temp. C % Vol. Properties Unit ValueLPG 0.05 LPGNaphtha <145 9.83 Naphtha

Octane RON 44Kerosine 145-250 14.37 Kerosine

Sulfur Content Parts/mill. 33.91Freezing Point Temp. C -56

Gas Oil 230-360 19.6 Gas OilSulfur Content % Wt. 0.07Pour Point Temp. C -9Cetane Index 56.1

Residue >370 58.23 ResidueSulfur Content % Wt. 0.321Pour Point Temp. C 36Viscosity (Kin) Cen at 50/100 C 460/18.4Asphaltenes % Wt. 2.57Vanadium Parts/mill. 2.45

Year Of Crude Oil Sample: 1995 Nickel parts/mill. 2.55


ESCALANTE Argentina

Gravity: 24.1 Sulfur: 0.19 Loading Port: Bahia Blanca

Production

Output comes from a group of onshore fields located in the Rio Negro and Neuquenprovinces in central Argentina. Most of the output is used in local refineries, with exportsof about 50,000 b/d in 1996.

Quality

A medium- to heavy-gravity crude oil that is relatively low in sulfur, similar to Ecuador�sOriente.

Producers

In addition to former state YPF, local independent Perez Companc also produces andsells the crude oil.


Usually sold on an f.o.b. basis from Argentina at prices linked to US West TexasIntermediate grade. In 1996, the discount to WTI was running at about $3.40-$3.50 a bar-rel. The primary markets for the 50,000 b/d of exports in 1996 were Brazil and the US.

Sellers


Loading Port

Bahia Blanca. 39.03 S. 61.50 W. The port, about 300 miles southwest of Buenos Aires,contains a crude oil-loading terminal consisting of two loading points in water depths of18-29 meters. The terminal has 500,000 barrels of storage.


ESCALANTE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 24.1 Sulfur Content % Weight 0.19Viscosity (Kin) cts at 100F 307.2 Pour Point Temp. F 30

Reid Vapor Pressure psi 1.4


Cut Points YieldProduct Temp. F % Vol. % Wt. Properties Unit ValueLPG <55 0.04 0.02 LPGLight Naphtha 55-165 1.97 1.46 Light Naphtha

Reid Vapor Pressure psi 12.8Int. Naphtha 165-220 2.57 4.58 Intermediate Naphtha


Heavy Naphtha 220-300 2.45 2 Heavy NaphthaParaffins % Wt. 65Naphthenes % Wt. 29Aromatics % Wt. 5

Kerosine 300-400 5.08 4.33 KerosineSulfur Content ppm 35

Light Gas Oil 400-525 8.84 8.04 Light Gas OilSulfur Content ppm 254Pour Point Temp. F -30

Int. Gas Oil 525-600 5.44 5.09 Intermediate Gas OilSulfur Content % Wt. 0.07Pour Point Temp. F 20Viscosity (kin) cts at 100 F 4.47

Residue >600 73.5 76.8 ResidueSulfur Content % Wt. 0.24Pour Point Temp. F 90Viscosity (Kin) Cen at 100 F 12367Conradson Carbon R % Wt. 10.63Vanadium Parts/mill. 2.2

Year Of Crude Oil Sample: 1992 Nickel Parts/mill. 1.9


MEDANITO Argentina

Gravity: 35.1 Sulfur: 0.431 Loading Port: Bahia BlancaOther Names: Rio Negro

Production

The country�s primary crude oil stream, with production of about 300,000 barrels a day.But most of this oil is consumed at domestic refineries. Output comes from the largeNeuquen province in the central, western part of the country near the border with Chile.The provinces of Rio Negro and La Pampa also contribute smaller volumes to theMedanito stream.

Quality

A medium- to light-gravity crude oil that is relatively low in sulfur, making it attractivefor most refiners.

Producers

In addition to former state YPF, local independents Pluspetrol and Perez Companc areproducers and sellers of the crude oil.


Usually sold on an f.o.b. basis from Argentina at prices linked to US West TexasIntermediate grade. In 1996, the discount to WTI was running at about $1.75 a barrel, abit narrower than in 1994-95. The new 100,000 b/d Trans-Andean export pipeline toChile is also taking some Medanito. In 1996, Medanito exports were running at about30,000 b/d, down slightly from 1994 levels. Most of these exports go to Brazil�s statePetrobras or US Gulf Coast refiners.

Sellers


Loading Port

Bahia Blanca. 39.03 S. 61.50 W. The port, about 300 miles southwest of Buenos Aires,contains a crude oil-loading terminal consisting of two loading points in water depths of18-29 meters. The terminal has 500,000 barrels of storage.


MEDANITO ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.1 Sulfur Content % Weight 0.431Viscosity (Kin) cts at 100F 6 Pour Point Temp. F 30

Reid Vapor Pressure psi 3.1


Cut Points YieldProduct Temp. F % Vol. % Wt. Properties Unit ValueLPG <80 1.22 0.87 LPGLight Naphtha 80-160 4.19 3.31 Light Naphtha

Octane RON 70Int. Naphtha 160-220 5.57 4.75 Intermediate Naphtha



Kerosine 300-480 19.08 18.01 KerosineSulfur Content % Wt. 0.03

Light Gas Oil 480-600 12.94 12.83 Light Gas OilSulfur Content % Wt. 0.1Cloud Point Temp. F 10Cetane Index 51.8

Int. Gas Oil 600-660 6.63 6.75 Intermediate Gas OilSulfur Content % Wt. 0.3Cloud Point Temp. F 48Cetane Index 50.7

Residue >660 41.4 45.5 ResidueSulfur Content % Wt. 0.77Pour Point Temp. F 90Viscosity (Kin) Cen at 150 F 94.5Asphaltenes % Wt. 1.22Conradson Carbon R % Wt. 5.79Vanadium Parts/mill. 15



RINCON Argentina

Gravity: 36.1 Sulfur: 0.28 Loading Port: San Vincente, ChileOther Names: Rincon De Los Sauces

Production

The country�s primary export crude oil stream, with international sales of about 95,000b/d in 1996. Production is from fields that lie in the Andes foothills and feed into bothdomestic pipelines and the Trans-Andean pipeline to Chile.

Quality

The highest-quality Argentine export grade is fairly light and sweet, with good yields ofgasoline and mid-distillates.

Producers

In addition to former state YPF, local independents are also producers and sellers of thecrude oil.


Exports of about 95,000 b/d move west to Chile via the 100,000 b/d Trans-Andeanpipeline, and most of the crude oil is used in Chile. Some 5,000-10,000 b/d of the grademoves from Chile to the Far East, but these volumes are down from 1995 levels. Pricesare linked to WTI with a discount of about $1 a barrel in 1996.

Sellers


Loading Port

San Vincente Terminal (Chile). 36.44 S. 73.09 W. The port lies south of Valaparaisoon the Pacific coast of Chile. The Trans-Andean pipeline terminates at the loading port,which has 1-million barrels of storage capacity. The terminal can handle vessels up to70,000 deadweight tons at a single berth with maximum draft of 43 feet. Larger tankerscan be loaded through top-off operations in Conception Bay.


RINCON ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.1 Sulfur Content % Weight 0.28Viscosity (Kin) cts at 100F 4.86 Pour Point Temp. F 25Hydrogen Sulfide ppm <1 Reid Vapor Pressure psi <0.2


Cut Points YieldProduct Temp. F % Vol. % Wt. Properties Unit ValueLPG 0.36 0.26 LPGLight Naphtha <160 4.05 3.09 Light Naphtha

Octane RON 73Int. Naphtha 160-220 4.09 3.51 Intermediate Naphtha



Kerosine 300-480 22 21 KerosineSulfur Content % Wt. 0.02


Int. Gas Oil 600-660 6.82 6.97 Intermediate Gas OilSulfur Content % Wt. 0.25Cloud Point Temp. F 48Cetane Index 51.5

Residue >660 37.8 41.4 ResidueSulfur Content % Wt. 0.6Pour Point Temp. F 90Viscosity (Kin) Cen at 150 F 60.15Asphaltenes % Wt. 0.93Conradson Carbon R % Wt. 4.66Vanadium Parts/mill. 10



COSSACK Australia

Gravity: 47.0 Sulfur: 0.03 Loading Port: Cossack FPSO Other Names: Wanaea/Cossack

Production

The two Northwest Shelf fields, Wanaea and Cossack, began production in late 1995from an FPSO (floating production, storage, and offloading) vessel and quickly reachedpeak flows of 115,000 barrels a day. However, output has been disrupted at times bysevere storms, which make the offshore production system vulnerable to disruption. Thecrude oil is offloaded.

Quality

A high-quality Asia-Pacific light, sweet crude oil excellent for gasoline manufacture, butwith a relatively high wax content. Its residue is excellent cracker feedstock. It is similarto Gippsland and Papua New Guinea�s Kutubu grade.

Producers

The fields are operated by Woodside Petroleum and are owned by the same group offirms that hold the nearby Northwest Shelf LNG project: Woodside, Shell, Chevron, BP,BHP, and the Japanese Mimi consortium. All firms have equal shares.


The grade is sold by all of the partners into Asian and US West Coast export markets andis also used in Australia as a replacement for declining Gippsland production. Japaneserefiners were some of the first buyers of the grade.

Sellers

Woodside Petroleum Ltd.: G.P.O. Box 839J, Melbourne, VIC 3001, Australia. Tel.:(61-3) 9605-0605, Fax: (61-3) 9602-5621.

BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, VIC3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices:Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo:(813) 5251-1371.

BP Developments Australia: 1 Albert Road, Melbourne, VIC 3000, Australia. Tel.:(61-3) 9268-4111.

Chevron Asiatic Ltd.: 385 Bourke St., Melbourne, VIC 3000, Australia. Tel.: (61-3)9670-5511.

Shell Development (Australia) : 1 Spring St., Melbourne, VIC 3000, Australia. Tel.:(61-3) 9666-5444.

Loading Port

Cossack Pioneer FPSO 19.35 S 116.26 E. The floating production unit at the Cossackfield has storage capacity of 1-million barrels of crude oil and can accommodate tankersup to 150,000 dead-weight tons.


COSSACK ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 47.3 Sulfur Content % Weight 0.03Barrels /Metric Ton 7.965 Pour Point Temp. C -18Viscosity Centistokes 1.45 Reid Vapor Press. Lbs/Sq. In. 6.4(Kinematic) at 40 C


Cut Points YieldProduct Temp. C % Vol. % Wt. Properties Unit ValueLPG 2.56Light Naphtha <70 8.8 7.2 Light Naphtha

Octane RON Clear Octane 69.6Int. Naphtha 70-140 23.9 22.3 Intermediate Naphtha



Kerosine 190-230 9 9.1 KerosineSulfur Content % Wt. <0.01Freezing Point Temp. C -44

Gas Oil 230-360 25.5 27.2 Gas OilSulfur Content % Wt. 0.03Cloud Point Temp. C -5Cetane Index 51.7

Residue >360 16.8 19.2 ResidueSulfur Content % Wt. 0.17Pour Point Temp. C 39Viscosity (Kin) Cen at 70 C 17.9Asphaltenes % Wt. 0.3

Year Of Crude Oil Sample: 1995 Conradson Carbon R % Wt. 2.2


GIPPSLAND Australia

Gravity: 47.0 Sulfur: 0.09 Loading Port: WesternportOther Names: Gippsland Blend, Bass Strait

Production

Some 20 offshore fields provided a combined 228,000 barrels a day in 1995 from the BassStrait area, which lies between the southern coast of Victoria and the island of Tasmania.The area is mature, and output peaked in 1985 at about 500,000 b/d, but the decline hasbeen slowed by enhanced recovery and development of small satellite fields. Gippslandis still Australia�s primary crude oil stream, and it is expected to produce about 200,000b/d through 2000.

Quality

A high-quality Asia-Pacific light, sweet grade excellent for gasoline manufacture, but witha relatively high wax content. Its residue is excellent cracker feedstock.

Producers

Exxon is the operator and equal partner with BHP in all of the fields.


Most of this crude oil is now used locally in Australia with an occasional internationalspot sales. Neither Exxon nor BHP has downstream networks in Australia, and they resellthe oil to domestic refineries, usually at prices linked to Malaysian Tapis Blend.

Sellers

Exxon Australia Ltd.: 360 Elizabeth St., Melbourne, Victoria 3000, Australia. Tel.:(61-3) 9270-3333, Fax: (61-3) 9270-3898.

BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, Victoria3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices:Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo:(813) 5251-1371.

Loading Port

Westernport. 38.21 S. 145.14 E. The Westernport terminal consists of three crude oil-loading berths, two at Crib Point Jetty and one at Long Island Jetty. No. 1 Crib Point canaccommodate 100,000-ton tankers with a depth of 15.8 meters. No. 2 Crib Point takes upto 40,000-ton tankers with a depth of 12.8 m. The loading berth at Long Island Jettyaccommodates tankers up to 100,000 tons.


GIPPSLAND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 47 Sulfur Content % Weight 0.09Barrels /Metric Ton 7.952 Pour Point Temp. C 9Viscosity Centistokes 2.509 Wax Content % Weight 7.6(Kinematic) at 20 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueNaphtha 70-165 26.5 25 Naphtha


Kerosine 165-240 15 15.1 Kerosine329-464 Sulfur Content % Wt. 0.04

Gas Oil 240-360 25.8 27.6 Gas Oil464-680 Sulfur Content % Wt. 0.1



Pour Point Temp. C 48Year Of Crude Oil Sample: 1993 Conradson Carbon R % Wt. 1.6


GRIFFIN Australia

Gravity: 55.0 Sulfur: 0.03 Loading Port: Griffin FPSO

Production

About 80,000 barrels a day is produced from this offshore oil and gas field which liesjust south of the main gas fields on the Northwest Shelf. The production is from a float-ing production, storage and offloading unit, which must be disconnected during severestorms. This causes occasional disruptions to production flows.

Quality

A high-quality Asia-Pacific light, sweet crude oil with high yields of naphtha and highquality middle distillates.

Producers

The fields are operated by BHP Petroleum, which holds a 45% stake along with Mobil(35%) and Inpex Alpha (20%).


The crude oil is sold by the partners independently into the Australian market and toAsian and US export markets. It is also used in Australia as a replacement for decliningGippsland production.

Sellers

BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, VIC3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices:Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo:(813) 5251-1371.

Mobil Sales & Supply Corp., Singapore: 18 Pioneer Road, 2262 Singapore. Tel.:(65) 660-6401, Fax: (65) 264-1693.

Loading Port

Griffin Venture FPSO 21.13 S. 114.38 E. The floating production unit at the Griffin fieldhas storage capacity of 820,000 barrels of crude oil and can accommodate tankers up to150,000 deadweight tons.


GRIFFIN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 55 Sulfur Content % Weight 0.03Barrels /Metric Ton 8.3 Pour Point Temp. C -48Viscosity Centistokes 1.24 Reid Vapor Press. Lbs/Sq. In. 5.4(Kinematic) at 20 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLight Naphtha <70 8.6 7.4 Light Naphtha

<158 Octane RON 68Paraffins % Wt. 96Naphthenes % Wt. 4Aromatics % Wt. 0

Int. Naphtha 70-135 30.2 28.4 Int. Naphtha158-275 Paraffins % Wt. 50

Naphthenes % Wt. 39Aromatics % Wt. 11


Freezing Point Temp. C -51Gas Oil 270-360 11.6 13 Gas Oil

518-680 Sulfur Content % Wt. 0.08Cloud Point Temp. C -3Cetane Index 53.4Pour Point Temp. C -3

Residue >360 16.8 19.2 ResidueSulfur Content % Wt. 0.14Pour Point Temp. C 27Viscosity (Kin) Cen at 50 C 28.7

Year Of Assay: 1991 Asphaltenes % Wt. 0.4Year Of Crude Oil Sample: 1995 Conradson Carbon R % Wt. 2.1


NORTHWEST SHELF CONDENSATE Australia

Gravity: 59.5 Sulfur: <0.01 Loading Port: Withnell Bay

Production

Condensate output of 80,000 barrels a day from the North Rankin and Goodwyn fieldsis associated with gas output for liquefied natural gas exports. Volumes rose sharply in1995 with the addition of Goodwyn A supplies.

Quality

A very light, gasoline-rich condensate that is not as middle distillate-oriented asIndonesian Arun Condensate, the main regional grade.

Producers

The partners of the Northwest Shelf LNG project share the condensate in the same pro-portions as the gas. They are Woodside, BHP, Chevron, Shell, British Petroleum, andJapanese Mimi (Mitsubishi-Mitsui). They all have equal shares.


The firms sell their output individually except for Mimi�s volumes, which have been han-dled by BHP. BP is the only producer to take volumes for its domestic refining system,with the rest exported, mainly to Japan, South Korea, and Taiwan.

Sellers

Woodside Petroleum Ltd.: G.P.O. Box 839J, Melbourne, Victoria 3001, Australia.Tel.: (61-3) 9605-0605, Fax: (61-3) 9602-5621.

BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, Victoria3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices:Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo:(813) 5251-1371.

BP Developments Australia: 1 Albert Road, Melbourne, Victoria 3000, Australia.Tel.: (61-3) 9268-4111.

Chevron Asiatic Ltd.: 385 Bourke St., Melbourne, Victoria 3000, Australia. Tel.: (61-3) 9670-5511.

Shell Development (Australia) : 1 Spring St., Melbourne, Victoria 3000, Australia.Tel.: (61-3) 9666-5444.

Loading Port

Withnell Bay. 20.35 S. 116.45 E. The Withnell Bay terminal is part of the port of Dampierand is operated by Woodside for the loading of LNG and some oil production. Tankersfrom 20,000 deadweight tons to 150,000 dwt can be accommodated and total storageamounts to 1.8-million barrels.


NORTHWEST SHELF CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 59.5 Sulfur Content ppm 120Barrels /Metric Ton 8.5 Pour Point Temp. C <-48Viscosity Centistokes 0.789 Reid Vapor Press. Lbs/Sq. In. 8.8(Kinematic) at 20 C



<158 Octane RON 75.3Paraffins % Wt. 90Naphthenes % Wt. 9Aromatics % Wt. 1

Int. Naphtha 70-140 37.6 37.9 Int. Naphtha158-284 Paraffins % Wt. 42


Kerosine 140-290 28.4 31 Kerosine284-554 Sulfur Content ppm <3

Freezing Point Temp. C -47Residue >290 4.6 5.4 Residue

Sulfur Content ppm 580Year Of Assay: 1995 Pour Point Temp. C -15Year Of Crude Oil Sample: 1995 Viscosity (Kin) Cen at 40 C 8.9


BRUNEI CONDENSATE Brunei

Gravity: 66.5 Sulfur: <0.01 Loading Port: Seria

Production

Output of about 20,000 barrels a day in conjunction with gas supply to a liquefied nat-ural gas export plant.

Quality

Similar in quality to Indonesian Arun Condensate, with large yields of naphtha and gasoil. The naphtha is well suited for gasoline manufacturing.

Producers

Brunei Shell Petroleum, a 50/50 joint venture between the government and the RoyalDutch/Shell Group, is the sole producer.


All sales are handled by Brunei Shell independently of Shell International. Most sales areon a term-contract basis to Japan, with prices set retroactively every month. Light SoutheastAsian spot-traded crude oils and Arun Condensate are used as pricing reference points.Spot deals are sporadic, with Australia and the US West Coast the main destinations.

Sellers

Brunei Shell Petroleum Co. Ltd.: RBA Plaza Jalan Sultan, 2nd Floor, Bandar SeriBegawan 1999, Negara Brunei Darussalam. Tel.: (673-2) 29269, Fax: (673-2) 41417, Telex:BU 2573.

Loading Port

Seria. 04.43 N. 114.19 E. The Seria terminal is an open-sea berth consisting of two sin-gle-buoy moorings located approximately 5.4 miles off the coast. Size restrictions are thefollowing: 313,000 deadweight tons and maximum draft 15.8 meters at SBM 1; 200,000dwt and maximum draft 17 m at SBM 2.


BRUNEI CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 66.5 Sulfur Content % Weight <0.01Barrels /Metric Ton 8.808 Pour Point Temp. C <-30Viscosity Centistokes 0.53 Reid Vapor Press. Lbs/Sq. In. 9.7(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <3


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 4.0 3.4Light Naphtha <85 48.3 45.2 Light Naphtha

<185 Octane RON Clear Octane 74Int. Naphtha 85-165 35.7 38 Intermediate Naphtha



Freezing Point Temp. C <-61Light Gas Oil 235-300 2.6 2.9 Light Gas Oil

455-572 Sulfur Content % Wt. 0.05Cloud Point Temp. C -21Cetane Index 57.5


Cetane Index 69.1Viscosity (Kin) 60 C 5.61

Residue >350 0 0 Residue>662

Year Of Crude Oil Sample: 1987


BRUNEI LIGHT Brunei

Gravity: 40.3 Sulfur: 0.06 Loading Port: Seria

Production

Output of about 50,000 barrels a day mainly from offshore fields, of which about 20,000-25,000 b/d is blended with Champion to make Seria Light Export Blend.

Quality

A light, low-sulfur Asian crude oil with a high wax content that is similar to MalaysianTapis.

Producers



All of the roughly 25,000 b/d of exports are sold by Brunei Shell Petroleum on a spotbasis, with Singapore, the Philippines, Australia, and China the main importers.

Sellers


Loading Port



BRUNEI LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 40.3 Sulfur Content % Weight 0.06Barrels /Metric Ton 7.643 Pour Point Temp. C 9Viscosity Centistokes 2.41 Reid Vapor Press. Lbs/Sq. In. 4.8(Kinematic) at 20 C Hydrogen Sulfide Parts/mill. <1



<185 Octane RON Clear Octane 75Int. Naphtha 85-165 23.6 22.1 Intermediate Naphtha



Freezing Point Temp. C -55Light Gas Oil 235-300 20 20.8 Light Gas Oil





Pour Point Temp. C 45Viscosity (Kin) Cen at 60 C 27.9Asphaltenes % Wt. 0.09Conradson Carbon R % Wt. 1.16Vanadium Parts/mill. <1



CHAMPION Brunei

Gravity: 23.7 Sulfur: 0.13 Loading Port: Seria

Production

About 80,000 barrels a day from offshore fields, with 45,000-50,000 b/d blended into theSeria Light Export Blend stream.

Quality

A typical heavy, low-sulfur Asian crude oil with high wax content, making it similar inquality to Indonesian Duri but somewhat lower in sulfur.

Producers



Champion exports are about 30,000-35,000 b/d. All of the production is sold by BSP,mostly on term contracts to third parties in Southeast Asia, Japan, and South Korea.Japanese imports in 1995 were 10,000 b/d. Prices are set on a retroactive basis everymonth at a narrow discount to higher-quality Seria Light Export Blend, Brunei�s mainexport crude oil. Security of supply and access to Brunei�s higher-quality light crude oilsand condensate compensate for the relatively stiff price terms.

Sellers


Loading Port



CHAMPION ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 23.7 Sulfur Content % Weight 0.13Barrels /Metric Ton 6.905 Pour Point Temp. C <-30Viscosity Centistokes 6.97 Reid Vapor Press. Lbs/Sq. In. 2.7(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 0.4 0.3Light Naphtha <85 1.7 1.3 Light Naphtha





455-572 Sulfur Content % Wt. 0.05Cloud Point Temp. C <-30Cetane Index 31.5


Cloud Point Temp. C <-30Cetane Index 33.7Viscosity (Kin) Cen at 40 C 9.08


Pour Point Temp. C 27Viscosity (Kin) Cen at 60 C 241Asphaltenes % Wt. 0.04Conradson Carbon R % Wt. 1.59Vanadium Parts/mill. <1


CHAMPION TERM CONTRACT PRICES, 1978-93At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.80 $14.60 $32.95 $39.90 $35.10 $29.10 $29.10 $29.10 Feb. 13.80 14.60 32.95 39.90 35.10 29.10 29.10 27.85March 13.80 15.70 32.95 39.15 34.10 29.10 29.10 27.85April 13.80 17.00 32.95 39.15 34.10 29.10 29.10 27.85May 13.80 17.50 34.95 37.75 34.10 29.10 29.10 27.85June 13.80 19.90 35.65 36.50 34.10 29.10 29.10 27.85July 13.80 22.75 35.65 36.50 34.10 29.10 29.10 27.85Aug. 13.80 22.75 35.65 36.50 34.10 29.10 29.10 27.85Sept. 13.80 22.75 35.65 36.50 34.10 29.10 29.10 27.85Oct. 13.80 22.75 35.65 36.50 34.10 29.10 29.10 27.85Nov. 13.80 26.05 35.65 35.10 34.10 29.10 29.10 27.85Dec. 13.80 27.45 36.15 35.10 34.10 29.10 29.10 27.85Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $27.85 $17.60 $17.20 $16.40 $20.20 $27.10 $21.05 $19.30 Feb. 20.90 18.30 17.30 18.10 20.60 22.65 19.50 19.00March 16.50 17.70 16.65 17.80 20.05 19.20 18.65 20.15April ... 18.05 15.85 18.80 18.75 18.35 18.30 20.80May ... 18.15 16.75 19.25 16.80 18.85 19.60 20.25June ... 18.35 16.75 18.85 15.55 19.50 21.20 19.50July ... 18.60 14.70 18.65 15.10 20.00 22.95 18.75Aug. 10.85 19.00 14.70 17.85 20.80 20.10 22.50 18.75Sept. 12.75 18.70 14.05 17.35 29.50 20.60 21.70 18.70Oct. 13.40 18.70 12.50 18.10 38.90 21.70 21.35 18.10Nov. 14.00 18.70 12.15 18.95 36.30 22.75 21.20 17.50Dec. 14.55 18.05 13.65 19.30 31.20 23.30 20.40 15.85Note: More recent prices can be found in Chapter I.


SERIA LIGHT EXPORT BLEND Brunei

Gravity: 34.6 Sulfur: 0.08 Loading Port: SeriaOther Names: SLEB

Production

An export blend of about 70,000 barrels a day made up of 45,000-50,000 b/d ofChampion and 20,000-25,000 b/d of Brunei Light. No output from other sources.

Quality

A medium, low-sulfur Asian crude oil that is similar to Indonesian Minas grade but witha larger kerosine yield.

Producers



All exports are sold by Brunei Shell Petroleum, mostly on term contracts to third partiesin Singapore, Japan, and Thailand. Japan imported 35,000 b/d in 1995. Prices are set ona retroactive basis every month on the basis of spot prices for similar quality Asiangrades.

Sellers


Loading Port



SERIA LIGHT EXPORT BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 34.6 Sulfur Content % Weight 0.08Barrels /Metric Ton 7.39 Pour Point Temp. C 0Viscosity Centistokes 3.94 Reid Vapor Press. Lbs/Sq. In. 4.4(Kinematic) at 20 C Hydrogen Sulfide Parts/mill. <1






Freezing Point Temp. C -60Light Gas Oil 235-300 21.4 22 Light Gas Oil

455-572 Sulfur Content % Wt. 0.06Cloud Point Temp. C -32Cetane Index 39




Pour Point Temp. C 39Viscosity (Kin) Cen at 60 C 63.2Asphaltenes % Wt. 0.08Conradson Carbon R % Wt. 1.61Vanadium Parts/mill. <3


SERIA LIGHT EXPORT BLEND TERM CONTRACT PRICES, 1978-93At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $14.15 $14.95 $33.40 $40.35 $36.10 $30.10 $30.10 $28.35 Feb. 14.15 14.95 33.40 40.35 36.10 30.10 30.10 28.35March 14.15 16.10 33.40 39.60 35.10 30.10 30.10 28.35April 14.15 17.45 33.40 39.60 35.10 30.10 30.10 28.35May 14.15 17.95 35.40 38.60 35.10 30.10 30.10 28.35June 14.15 20.35 36.10 37.10 35.10 30.10 30.10 28.35July 14.15 23.20 36.10 37.10 35.10 30.10 30.10 28.35Aug. 14.15 23.20 36.10 37.10 35.10 30.10 30.10 28.35Sept. 14.15 23.20 36.10 37.10 35.10 30.10 30.10 28.35Oct. 14.15 23.20 36.10 37.10 35.10 30.10 29.60 28.35Nov. 14.15 26.50 36.10 36.10 35.10 30.10 28.35 28.35Dec. 14.15 27.90 36.60 36.10 35.10 30.10 28.35 28.35Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $28.35 $17.60 $17.20 $16.50 $20.20 $27.25 $21.15 $19.40 Feb. 21.50 18.30 17.40 18.20 20.60 22.75 19.60 19.10March 17.00 17.90 16.75 17.90 20.10 19.30 18.75 20.25April ... 18.25 15.95 18.90 18.80 18.45 18.40 20.90May ... 18.35 16.85 19.35 16.90 18.95 19.70 20.35June 12.00 18.50 16.85 18.90 15.65 19.60 21.30 19.60July 10.20 18.70 14.80 18.75 15.20 20.10 23.05 18.85Aug. 11.10 19.00 14.80 17.95 20.90 20.20 22.60 18.85Sept. 12.95 18.70 14.15 17.45 29.60 20.70 21.80 18.80Oct. 13.60 18.70 12.60 18.20 39.00 21.80 21.45 18.20Nov. 14.10 18.70 12.25 19.05 36.40 22.85 21.30 17.60Dec. 14.55 18.05 13.75 19.30 31.30 23.40 20.50 15.95Note: More recent prices can be found in Chapter I.


KOLE Cameroon

Gravity: 34.8 Sulfur: 0.30 Loading Port: Kole

Production

Kole is a heavy, sweet grade that is a blend of multiple offshore crude oil streams knownas Rio del Rey. Production is declining and was about 75,000 barrels a day in 1995. Koleis the largest production stream in Cameroon.

Quality

A medium-to-light, low-sulfur West African crude oil that is prized by refiners for its high-quality middle distillate yield. Its high metals content poses problems for cracking.

Producers

Societe Nationale des Hydrocarbures (Cameroon) (70%) , French Elf Aquitaine (15.3%) ,US Shell affiliate Pecten (14.7%).


Almost all production is exported by the three equity producers with volumes dividedaccording to their shares. Shell�s Pecten and Elf market their barrels on a spot basis, whileCameroon�s state SNH sells its share in the form of term contracts with some of the oilresold on a spot basis. In the early 1990s, Elf marketed SNH�s share of the grade. All salesare priced on a dated Brent basis. Elf and Shell occasionally take Kole into their ownrefining systems.

Sellers

Pecten Trading Co.: P.O. Box 2099, Houston, Texas 77252. Tel.: (713) 241-6161, Fax:(717) 241-0004.


Main Customers

Traditionally cargoes move to the US and Europe with some traders holding term con-tracts with SNH. Since 1992, cargoes have also increasingly found their way to the FarEast, where middle distillate demand has been strong, and where the grade is used as asubstitute for similar Asia-Pacific grades.

Loading Port

Kole. 04.13 N. 08,33 E. The offshore Kole loading point is located about 26 miles fromCape Debunsha and consists of one single-buoy mooring designed for tankers ofapproximately 50,000-250,000 deadweight tons. The maximum draft is 72 feet (22meters).


KOLE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 34.8 Sulfur Content % Weight 0.3Barrels /Metric Ton 7.4 Pour Point Temp. C -18Viscosity Centistokes 4.81 Reid Vapor Press. Lbs/Sq. In. 6.5(Kinematic) at 40 C













KOLE SPOT PRICES, 1987-93

At Port Of Loading In Dollars Per Barrel1987 1988 1989 1990 1991 1992 1993

Jan. $17.75 $15.95 $16.15 $20.15 $21.15 $17.20 $16.70 Feb. 16.85 14.85 15.95 19.00 18.50 17.15 17.55March 17.50 13.80 17.75 17.40 17.60 16.65 18.10April 17.70 15.65 19.40 15.15 17.45 18.15 17.90May 18.10 15.30 17.90 15.05 17.65 19.15 17.55June 18.25 14.30 16.70 13.50 16.65 20.45 16.70July 19.10 14.25 16.80 15.45 17.90 19.55 15.90Aug. 18.25 13.95 15.80 25.55 18.40 19.00 15.80Sept. 17.45 12.25 16.90 33.75 19.15 19.55 15.20Oct. 18.00 11.45 18.00 35.40 20.95 19.65 15.75Nov. 16.95 12.05 17.70 31.85 20.40 18.55 14.30Dec. 16.05 14.35 19.00 26.65 17.45 17.60 12.75Note: More recent prices can be found in Chapter I.


LOKELE Cameroon

Gravity: 19.6 Sulfur: 0.41 Loading Port: LokeleOther Names: Moudi

Production

Although declining, this is the second-largest stream in Cameroon with output of about20,000 barrels a day in 1995.

Quality

A heavy but low-sulfur crude oil with a high yield of high-pour residual fuel.

Producers

Societe Nationale des Hydrocarbures (Cameroon) (70%) , French Elf Aquitaine (15.3%) ,US Shell affiliate Pecten (14.7%).


Like Kole, Lokele is marketed primarily in the Atlantic Basin. It is mostly sold on a term-contract basis, with prices set at a differential to dated Brent. Shell�s Pecten, Elf, and stateSNH each sell their equity volumes separately, but they sometimes combine cargoes forsales to the Far East, which have grown more common.

Sellers

Pecten Trading Co.: P.O. Box 2099, Houston, Texas 77252. Tel.: (713) 241-6161, Fax:(717) 241-0004.


Main Customers

Mostly sold into Europe, particularly France, with some sales into Far East markets.

Loading Port

Lokele. 04.07 N. 08.29 E. The Lokele loading terminal, located in the Gulf of Guineaabout 50 nautical miles west of Limbe, consists of one floating storage unit (the �Moudi,�a converted 220,000-ton tanker) and one single-point mooring. The facility accommo-dates tankers from 50,000-280,000 deadweight tons.


LOKELE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 19.6 Sulfur Content % Weight 0.41Barrels /Metric Ton 6.722 Pour Point Temp. C -33Viscosity Centistokes 45.9 Reid Vapor Press. Lbs/Sq. In. 3.1(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1









Cloud Point Temp. C <-65Cetane Index 35.4Viscosity (Kin) Cen at 40 C 10.89


Pour Point Temp. C/F 27/80.6Viscosity (Kin) Cen at 60 C 1,734Asphaltenes % Wt. 0.22Conradson Carbon R % Wt. 7.27Vanadium Parts/mill. 7



BOW RIVER Canada

Gravity: 25.6 Sulfur: 2.37 Pipeline: Interprovincial

Production

One of many Canadian conventional heavy, sour crude oil production streams fromAlberta and other western provinces totaling some 660,000 barrels a day of productionin 1995. Other similar crude oils include Hardisty Heavy and the Lloydminster grades,totaling about 250,000 b/d of production. Deliveries of all conventional heavy crude oilsby the Interprovincial Pipe Line system amounted to about 550,000 b/d in 1995.

Quality

Bow River is one of a group of heavy, high-sulfur crude oils that are often good for pro-ducing asphalt or for deep conversion refining. This limits the potential refinery outlets,especially in Canada.

Producers

Produced by a wide range of small independents and other larger oil companies.


Interprovincial Pipe Line�s shipments of heavy grades like Bow River go mainly to USMidwest refiners, with only about 100,000 b/d used by Eastern Canadian refiners. Anactive spot trade exists at the Chicago terminal of the IPL with prices linked to WestTexas Intermediate. Canadian prices are based on refiner postings and are responsive toprice trends in the US.

Buyers And Sellers

The main buyers include US deep conversion refiners such as Koch, Amoco, and Mobil.Key sellers include Canadian marketers such as Northridge Petroleum.

Pipelines

The main gathering point for Bow River and other Western Canadian heavy crude oilsis along the Interprovincial Pipe Line starting in in Edmonton, Alberta. The 1.6-millionb/d pipeline system, which carries over 60 grades of crude oil and condensate, extendseastward to Duluth, Minnesota, where it splits into a northern branch across Michiganand into Ontario and a southern branch to Chicago. The section that runs east fromSarnia, Ontario, has carried about 160,000 b/d of Canadian domestic crude oil to easternrefiners, but this is due to be reversed in 1998 to allow increased imports of AtlanticBasin grades. This should release an equivalent volume of Canadian crude oil to the USMidwest market.


BOW RIVER ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 24.7 Sulfur Content % Weight 2.1Barrels /Metric Ton 6.96 Pour Point Temp. F -10Viscosity Centistokes 21.9(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 1.1Light Naphtha 55-175 5 Light Naphtha






Residue >650 57.4 ResidueSulfur Content % Wt. 3Pour Point Temp. F 60

Year Of Crude Oil Sample: 1989 Viscosity (Kin) Cst at 50 C 121

INTERPROVINCIAL PIPE LINE SPECIFICATIONS FOR SELECTED HEAVY CRUDE OILS� 1995

API Pour Point ViscosityGravity % Sulfur Temp.C (cts) 40C

Bow River 25.6 2.37 <-27 17.36Cold Lake 22.1 3.5 <-27 41.29Lloydminster Hardisty 22.2 3.09 <-27 34.16


HIBERNIA Canada

Gravity: 32 Sulfur: 0.5 Loading Port: Hibernia Platform

Production

The field, which lies offshore eastern Newfoundland in the North Atlantic is due to beginproduction in late 1997 with output rising to a plateau level of 125,000 barrels a day in2000. Other adjacent fields are likely to be added, keeping overall flows at these levelsor higher.

Quality

A waxy, sweet crude oil with a relatively high pour point of as much as 60 degreesFahrenheit. It is likely to be good for upgrading but may present some handling prob-lems. A full assay is not available until commercial production begins.

Producers

Produced by Mobil (33%), Chevron (27%), Petro-Canada (25%), Murphy (6.5%), andCanada Hibernia Holdings (6.5%).


Pricing terms have yet to be determined, but the crude oil seems likely to trade at a dif-ferential to West Texas Intermediate. The crude oil should be easily marketed to nearbyeastern Canadian and US refiners.

Loading Port

The crude oil will be loaded at the Hibernia platform which lies 315 kilometers east-southeast of St. Johns, Newfoundland. The platform will have storage capacity of 1-mil-lion barrels and will be served by dedicated tankers of 120,000 deadweight tons that willdeliver the crude oil to a transshipment terminal at Whitten Head near Newfoundland�sCome By Chance refinery. From the terminal it will be shipped to East Coast refiners inCanada and the US.


HIBERNIA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.1 Sulfur Content % Weight 0.59Barrels /Metric Ton 7.29 Pour Point Temp. F 45Viscosity Centistokes 2.5 Total Acid mg KOH/g 0.15(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 1.7 LPGLight Naphtha 55-175 5.4 Light Naphtha






Residue >650 48.9 ResidueSulfur Content % Wt. 0.88Pour Point Temp. C/F 40/104



MIXED BLEND SWEET Canada

Gravity: 39-40 Sulfur: 0.25-0.5 Pipeline: Interprovincial

Other Names: Canadian Par, Alberta Light Main Crude Oils: Federated, Pease, Pembina, and Rainbow

Production

Output comes from a host of fields mainly in Alberta and elsewhere in Western Canada.The light, sweet crude oil volumes delivered on the Interprovincial Pipe Line in 1995,which were equivalent to Canadian Par, amounted to just under 250,000 barrels a day,with just over 100,000 b/d destined for export to the US. This appears to be about halfof the total production. Canadian Par and Mixed Blend Sweet are broad pipeline streamsthat contain many of the same crude oils.

Quality

A light, sweet crude oil that is equivalent to West Texas Intermediate. It has excellentgasoline manufacturing capabilities. The assay is for Mixed Blend Sweet.

Producers

Produced by a wide range of companies.


Interprovincial Pipe Line shipments of this grade are split about equally between refin-ers in Eastern Canada and the US Midwest. An active spot trade exists in the US GreatLakes region with prices linked to West Texas Intermediate. Canadian prices are basedon refiner postings and are responsive to price trends in the US.

Buyers And Sellers

The main buyers include Canadian refiners such as Imperial, Shell and Petro-Canada aswell as Chicago and Detroit area refiners in the US. Key sellers include Canadian mar-keters such as Northridge Petroleum.

Pipelines

The main gathering point for Canadian Par is at the Interprovincial Pipe Line inEdmonton, Alberta. The 1.6-million b/d pipeline system extends eastward to Duluth,Minnesota, where it splits into a northern branch across Michigan and into Ontario anda southern branch to Chicago. The section that runs east from Sarnia, Ontario, has car-ried about 160,000 b/d of Canadian crude oil to eastern refiners, but this is due to bereversed in 1998 to allow increased imports of Atlantic Basin grades. This should releasean equivalent volume of Canadian crude oil to the US Midwest market.


MIXED BLEND SWEET ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39 Sulfur Content % Weight 0.39Barrels /Metric Ton 7.596 Pour Point Temp. F 15Viscosity Centistokes 3.4(Kinematic) at 40 C








Residue >650 36 ResidueSulfur Content % Wt. 0.81Pour Point Temp. F 90


INTERPROVINCIAL PIPE LINE SPECIFICATIONS FOR SELECTED LIGHT CRUDE OILS� 1995

API Pour Point ViscosityGravity % Sulfur Temp.C (cts) 40C

Federated 39.2 0.27 <-27 2.70Peace 40.3 0.47 -21 2.81Pembina 39.0 0.28 -12 3.56Rainbow 40.3 0.39 -18 2.85Mixed Blend Sweet 39.8 0.35 -7 2.89


DAQING China

Gravity: 32.1 Sulfur: 0.11 Loading Port: Dairen (Dalian)Other Names: Taching

Production

Exports of just over 200,000 barrels a day are about one-fifth of the 1.1-million b/d out-put of China�s largest field, where flows are maintained by extensive water flooding. Thefield lies in the Songliao Basin of northeastern China, the country�s main oil producingregion. Output is expected to decline to 1-million b/d or less in the late 1990s due toaging of the field, which, along with rapidly rising domestic oil demand, should curbexports. Exports were about 300,000 b/d in 1993.

Quality

Medium-gravity, low-sulfur Asian crude oil that is high in wax content. It is very similarto Indonesian Minas.

Producers

Produced exclusively by state China National Petroleum Co.


Sold primarily to Japan, which absorbed 200,000 b/d in 1995, with smaller volumes goingto Singapore and other destinations. A large share of the Japanese volume is used as boil-er fuel by electric utilities. Japanese sales are at retroactive monthly prices that trackIndonesian Minas levels. The primary seller is state Sinochem, but it no longer holds anexclusive monopoly on exports. Spot sales are rare.

Sellers

Sinochem International Oil (Hong Kong) Co.: 47/F Office Tower, ConventionPlaza, 1 Harbour Road, Wanchai, Hong Kong. Tel.: (852) 824-0100, Fax: (852) 824-2002.

Sinochem International Oil (Singapore) Pte. Ltd.: 4 Shenton Way, #09-08/12Shing Kwan House, 0106, Singapore. Tel.: (65) 225-5188, Fax: (65) 225-3878.

Loading Port

Dairen (Dalian). 38.55 N. 121.40 E. The Dairen terminal, located on the Bohai coast onthe southern edge of China�s northern Liaodong Peninsula, has two tanker berths on thecrude oil-loading jetty. Size restrictions are 100,000 deadweight tons and a maximumdraft of 15 meters for Berth No. 1, and a maximum draft of 12 m for Berth No. 2. Theport is being expanded to take 150,000-dwt tankers and has loaded ships up to 125,000dwt.


DAQING ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.2 Sulfur Content % Weight 0.11Barrels /Metric Ton 7.3 Pour Point Temp. F 90Viscosity Centistokes 33.4(Kinematic) at 40 C










DAQING TERM-CONTRACT PRICES, 1986-91At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991Jan. $17.58 $17.15 $16.83 $17.06 $19.21 $24.23 Feb. 17.58 17.15 16.83 17.06 19.21 20.55March 17.58 17.15 16.83 17.06 19.21 16.47April 10.62 17.40 16.29 18.15 16.09 17.21May 10.62 17.40 16.29 18.15 16.09 17.88June 10.62 17.40 16.29 18.15 16.09 18.22July 10.65 17.78 14.48 17.12 15.20 18.57Aug. 10.65 17.78 14.48 17.12 15.20 18.80Sept. 10.65 17.78 14.48 17.12 29.75 19.04Oct. 13.12 17.50 12.68 17.40 35.42 19.83Nov. 13.12 17.50 12.68 17.40 33.60 20.45Dec. 13.12 17.50 12.68 17.40 27.71 19.59

DAQING SPOT PRICES, 1987-92Month 1987 1988 1989 1990 1991 1992Jan. $16.65 $17.05 $16.80 $19.80 $23.40 $17.80 Feb. 17.00 17.00 17.35 20.80 19.85 17.55March 16.90 15.55 17.05 18.65 17.20 17.10April 17.15 15.95 18.20 16.75 17.10 17.20May 17.25 16.30 18.15 15.75 17.75 17.80June 17.35 16.15 18.05 14.90 18.20 19.95July 17.65 15.00 17.95 16.00 18.65 21.00Aug. 18.25 14.40 16.90 23.45 18.70 19.85Sept. 17.80 13.50 16.50 30.00 18.80 19.25Oct. 18.05 11.75 16.70 35.25 19.40 19.70Nov. 17.85 12.10 17.35 33.10 20.25 20.05Dec. 16.65 13.85 17.85 27.30 19.00 19.40Note: More recent prices can be found in Chapter I.


SHENGLI China

Gravity: 22.5 Sulfur: 0.90 Loading Port: Qingdao (T�sing Tao)

Production

Total output dropped to 600,000 barrels a day or 3% in 1995 from China�s second-largestfield, which lies onshore just south of Bohai Bay. Exports have declined and amount toabout 50,000 b/d. The field is mature, and extensive enhanced recovery efforts are underway to slow its natural decline.

Quality

A heavy Asia-Pacific crude oil similar to Indonesian Duri that is not particularly attractiveto refiners and is used for direct burning by Japanese utilities. The assay below is some-what dated, and recent tests indicate that the gravity has slipped to 22.5 with a sulfurcontent of 0.9% and a pour point of 28 degrees centigrade.

Producers

Produced exclusively by state China National Petroleum Co.


Sold primarily to Japan, which absorbed 27,000 b/d in 1995, with smaller volumes mov-ing to Singapore and elsewhere. Most of the Japanese volume is used as boiler fuel byelectric utilities. Japanese sales are at retroactive monthly prices that track IndonesianDuri levels plus a premium. The primary seller is state Sinochem, but it no longer holdsan exclusive monopoly on exports.

Sellers

Sinochem International Oil (Hong Kong) Co.: 47/F Office Tower, ConventionPlaza, 1 Harbour Road, Wanchai, Hong Kong. Tel.: (852) 824-0100, Fax: (852) 824-2002.

Sinochem International Oil (Singapore) Pte. Ltd.: 4 Shenton Way, #09-08/12Shing Kwan House, 0106, Singapore. Tel.: (65) 225-5188, Fax: (65) 225-3878.

Loading Port

Qingdao (T�sing Tao). 36.05 N. 120.18 E. The terminal, located on the Yellow Sea coastabout 380 miles north of Shanghai, has two crude oil-loading berths capable of handlingvessels up to 50,000 deadweight tons. Maximum draft is 12 meters on the West berth and13 m on the East berth. It is connected by pipeline to the Shengli field.


SHENGLI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 24.2 Sulfur Content % Weight 0.84Barrels /Metric Ton 6.927 Pour Point Temp. C 27Viscosity Centistokes 124 Reid Vapor Press. Lbs/Sq. In. 1.6(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1





Kerosine 165-235 5.6 5 Kerosine329-455 Sulfur Content % Wt. 0.07




Cloud Point Temp. C 9Cetane Index 59.7Viscosity (Kin) Cen at 60 C 718


Pour Point Temp. C/F 42/107.6Viscosity (Kin) Cen at 60 C 718Asphaltenes % Wt. 1Conradson Carbon R % Wt. 8Vanadium Parts/mill. 2



CANO LIMON Colombia

Gravity: 29.5 Sulfur: 0.47 Loading Port: CovenasOther Names: Colombian Blend

Production

Production has been declining in recent years from peak levels of almost 500,000 barrelsa day and flows in 1995 were about 215,000 b/d with exports of about 125,000 b/d. Thecrude oil from the Cano Limon field, which lies in the Amazon Basin, travels through a490-mile pipeline across the Andes to the Caribbean export terminal at Covenas.

Quality

A medium- to heavy-gravity crude oil that is relatively low in sulfur, similar in quality toUS Alaskan North Slope. Although from early production, the assay below is still accu-rate.

Producers

US Occidental is the operator, but it has sold off significant stakes and now holds onlya 6.5% share with partners state Ecopetrol (50%), Shell (25%), and Repsol (18.5%).


Cano Limon has been Colombia�s main export crude oil in the late 1980s and first halfof the 1990s, but it is being overtaken by fast rising Cusiana. State Ecopetrol sells abouthalf of the volume through a combination of term contracts and spot sales to indepen-dent refiners and traders, mainly in the US. Ecopetrol holds regular tenders for these termcontracts as they expire. With the exception of Occidental, the equity producers tend tokeep the crude oil within their own systems. Ecopetrol�s prices are on an f.o.b. basis andlinked by formulas to spot prices of US West Texas Intermediate grade. Sales are fre-quently interrupted due to periodic attacks on the vulnerable export pipeline by antigov-ernment guerrillas.

Sellers

Ecopetrol: Carrera 12, No. 36-24, Apdo. Aereo 5938, Santa Fe de Bogota, D.C.Colombia. Tel.: (57-1) 285-6400.

Shell International Trading And Shipping Company (STASCO): Shell-MexHouse, Strand, London WC2R 07A. Tel.: (44-171) 546-1234. Fax: (44-171) 546-4448.

Loading Port

Covenas. 09.25 N. 75.42 W. The Covenas offshore terminal is located in the Gulf ofMorresquillo about 56 miles south-southwest of Cartagena in the Caribbean Sea. Loadingfacilities consist of a single-buoy mooring and a floating storage unit, which is a perma-nently moored 390,000-deadweight ton tanker. Size restrictions are maximums of 145,000dwt and vessel length of 265 meters for berthing at the FSU, and 145,000 dwt and ves-sel length of 300 m for berthing at the SBM.


CANO LIMON ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 29.5 Sulfur Content % Weight 0.47Barrels /Metric Ton 7.166 Pour Point Temp. C 0Viscosity Centistokes 13.06 Reid Vapor Press. Lbs/Sq. In. 2.3(Kinematic) at 40 C






Freezing Point Temp. C -55Light Gas Oil 235-300 14 13.4 Light Gas Oil




Residue >350 48.8 53 Residue>662 Sulfur Content % Wt. 0.82



CANO LIMON SPOT AND TERM-CONTRACT PRICES, 1986-93

At Port Of Loading In Dollars Per Barrel. Spot Prices For 1986-87, And Term-Contract Prices Thereafter.Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. ... $18.55 $15.33 $16.00 $20.25 $20.30 $15.79 $16.43 Feb. ... 17.55 14.73 16.17 19.77 15.04 16.10 17.58March ... 18.05 14.18 17.65 18.36 16.57 16.36 17.87April ... 18.40 16.18 19.93 14.66 18.21 17.71 17.79May 13.80 19.10 15.23 18.10 14.39 17.77 18.51 17.55June 11.65 19.45 14.58 17.52 13.35 17.32 20.18 16.64July 9.90 20.35 14.16 17.45 15.67 18.15 19.44 14.99Aug. 13.70 19.05 13.96 16.60 26.37 18.51 18.81 15.28Sept. 13.80 18.45 12.71 16.85 33.66 18.95 19.34 14.88Oct. 14.05 18.90 11.55 17.65 32.17 20.18 19.39 15.73Nov. 14.35 17.50 11.45 17.85 29.58 19.17 18.16 14.07Dec. 15.65 15.80 14.10 19.30 24.91 16.43 17.19 12.11Note: More recent prices can be found in Chapter I.


CUSIANA Colombia

Gravity: 36.3 Sulfur: 0.25 Loading Port: CovenasOther Names: Cusiana Light, Cusiana/Cupiagua

Production

Production reached 200,000 barrels a day at end-1995 and is scheduled to hit 500,000b/d by end-1997. The field lies in the foothills of the eastern Andes and with neighbor-ing Cupiagua contains at least 2-billion barrels of reserves. Exports were running at about100,000 b/d in 1996 and should reach about 400,000 b/d in 1998. The fields are con-nected to the Caribbean port of Covenas by a 500-mile pipeline system that is beingexpanded to handle the increased output.

Quality

Cusiana itself is a light, low-sulfur crude oil that is comparable to North Sea Brent orNigerian Bonny Light. It has wide cuts of reforming naphtha and middle distillates and isexcellent for use with high-conversion units. Quality is likely to improve in 1998 with theaddition of some 200,000 b/d of lighter 42-gravity Cupiagua grade into the export stream.

Producers

In addition to operator BP (15.2%), other partners are state Ecopetrol (60%), Total(15.2%) and Triton Energy (9.6%).


Cusiana is sold on the international market by all of the equity partners, with Ecopetrolrelying primarily on term contracts with US Gulf Coast refiners while others tend to sellon a spot basis. In 1996, Ecopetrol�s main term customers were Tosco and Fina. Otherbuyers include Sun, Mapco, and Amoco. Ecopetrol�s prices are on an f.o.b. basis andlinked by formulas to spot prices of US West Texas Intermediate grade. Spot sales byother producers are on a similar basis.

Sellers

Ecopetrol: Carrera 12, No. 36-24, Apdo. Aereo 5938, Santa Fe de Bogota, D.C.Colombia. Tel.: (57-1) 285-6400. Contacts � Enrique Lee or Fernando Cardenas. Tel. (57-1) 287-0240 or (57-1) 285-2456.

British Petroleum: Contacts � Marty Power or Keith Chipchase. Tel: (713) 560-5515or (216) 586-6091.

Total: Contact � Alberto Valcarcel (713) 739-3446.Triton Energy: Contact � Rick Stevens (214) 691-5200.

Loading Port



CUSIANA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.3 Sulfur Content % Weight 0.25Barrels /Metric Ton 7.47 Pour Point Temp. F 32Viscosity Centistokes 4.73(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. % Wt. Properties Unit ValueLPG 2.2 1.85Naphtha <300 20.8 17.9 Intermediate Naphtha


Kerosine 300-450 15.9 15.15 KerosineSulfur Content % Wt. 0.002Freezing Point Temp. F -83

Gas Oil 450-648 24.3 24.9 Gas OilSulfur Content % Wt. 0.12Cloud Point Temp. F 53Cetane Index 45Viscosity (Kin) Cts at 122 F 3.01

Residue >648 36.8 40.2 ResidueSulfur Content % Wt. 0.54Pour Point Temp. F 102Viscosity (Kin) Cen at 122 F 62.4Asphaltenes % Wt. 0.2Vanadium Parts/mill. <2



VASCONIA Colombia

Gravity: 25.3 Sulfur: 0.81 Loading Port: Covenas

Production

Production is about 145,000 barrels a day with about 100,000 b/d used in Colombia andthe remainder exported. The crude oil comes from a group of fields in central Colombia.The fields are connected to the Caribbean port of Covenas by pipeline.

Quality

Vasconia is a medium- to low-sulfur, medium-weight crude oil. It is good for gasolinemanufacturing, and the middle distillates have good cold properties.

Producers

Royal/Dutch Shell is the field operator and main producer along with Ecopetrol.


Vasconia is marketed internationally by Shell, which sells it primarily on a spot basis toUS refiners at prices linked to West Texas Intermediate grade. Ecopetrol uses its share ofproduction locally.

Sellers

Shell International Trading And Shipping Company (STASCO): Shell-MexHouse, Strand, London WC2R 07A. Tel.: (44-171) 546-1234. Fax: (44-171) 546-4448. Also:Houston: (713) 241-6343.

Loading Port



VASCONIA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 25.3 Sulfur Content % Weight 0.81Barrels /Metric Ton 6.986 Pour Point Temp. C -9Viscosity Centistokes 21 Reid Vapor Press. Lbs/Sq. In. 3.4(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. Properties Unit ValueLPG 1.1Light Naphtha <85 4.1 Light Naphtha

<185 Octane RON Clear Octane 74Int. Naphtha 85-165 10.4 Intermediate Naphtha



Freezing Point Temp. C -64Light Gas Oil 235-300 11.5 Light Gas Oil


Int. Gas Oil 300-350 10.7 Intermediate Gas Oil572-662 Sulfur Content % Wt. 0.45

Cloud Point Temp. C -2Cetane Index 48Viscosity (Kin) Cen at 40 C 7.3

Residue >350 53.1 Residue>662 Sulfur Content % Wt. 1.28

Pour Point Temp. C 41Viscosity (Kin) Cen at 60 C 1089Asphaltenes % Wt. 5.93Conradson Carbon R % Wt. 11.4Vanadium Parts/mill. 148


VASCONIA SPOT PRICES, 1993

1993Jan. $16.43 Feb. 17.58March 17.87April 17.79May 17.55June 16.64July 14.99Aug. 15.28Sept. 14.88Oct. 15.73Nov. 14.07Dec. 12.11Note: More recent prices can be found in Chapter I.


DJENO Congo

Gravity: 27.6 Sulfur: 0.23 Loading Port: DjenoOther Names: Emeraude

Production

Output of about 150,000 barrels a day comes from several mature offshore fields includ-ing Emeraude, Loango, Yanga, Sendji, and Tchibouela, which are operated by French Elfand Italian Agip. State Hydro Congo has no direct equity stake in these fields.

Quality

A heavy, low-sulfur West African crude oil, with high wax content and a high pour point.


Traditionally, the crude oil was used primarily in the internal refining systems of Elf andAgip, but open market sales have increased to both Europe and Asia in the mid-1990sin addition to occasional sales to the US and Caribbean. Taiwan�s CPC has a 30,000 b/dterm contract and Hungary�s Mol is also a buyer. Prices are set according to discounts toUK Brent Blend, which typically are about $2.50 a barrel.

Sellers

Elf Trading SA, Geneva: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.:(41-22) 710-1112, Fax: (41-22) 710-1110.

Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-92-241, Fax: (39-6) 503-92-320.

Loading Port

Djeno. 04.56 S. 11.54 E. The loading point at the Djeno terminal is about 2.2 miles (3.8kilometers) from the coast, and about 9.5 miles south-southeast of the main Pointe Noirelighthouse. The single-buoy mooring facility is designed for tankers of approximately40,000-140,000 deadweight tons or partly loaded tankers of up to 240,000 dwt. The max-imum draft is 16 meters.


DJENO ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 27.6 Sulfur Content % Weight 0.23Barrels /Metric Ton 7.086 Pour Point Temp. F 60Viscosity Centistokes 47.3(Kinematic) at 100 F


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 1.3Light Naphtha <175 3.4 Light Naphtha



Heavy Naphtha 300-400 8.8 Heavy NaphthaNaphthenes % Wt. 54Aromatics % Wt. 9

Kerosine 400-500 7.4 KerosineSulfur Content % Wt. 0.12Freezing Point Temp. F -30

Atmos. Gas Oil 500-650 12.9 Atmospheric Gas OilSulfur Content % Wt. 0.14Cloud Point Temp. F 20Cetane Index 50


Year Of Crude Oil Sample: 1987 Pour Point Temp. F 73.4


N�KOSSA Congo

Gravity: 39.5 Sulfur: 0.08 Loading Port: N�Kossa

Production

Output of about 90,000 barrels a day comes from West Africa�s first deep-water field. Thefield lies in 180-350 meters of water just north of the Angola-Cabinda border. Output isexpected to peak at 120,000 b/d in 1998.

Quality

A light, low-sulfur West African crude oil that is well suited to gasoline manufacturing.Higher quality than typical West African grades, similar to Angola Palanca.

Producers

The N�Kossa field is operated by Elf. Other shareholders include Chevron and SouthAfrica�s Engen.


Initial sales have been primarily to Europe and the US at prices linked to dated Brentcrude oil. While these are likely to remain primary markets for the crude oil, Asian salesare also likely from time to time.

Sellers

Elf Trading SA, Geneva: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.:(41-22) 710-1112, Fax: (41-22) 710-1110.

Loading Port

N�Kossa. 05.20 S. 11.35 E. The crude oil is loaded from a dedicated storage tanker at thefield. The terminal is located about 25 miles offshore.


N�KOSSA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.5 Sulfur Content % Weight 0.08Barrels /Metric Ton 7.62


Cut Points YieldProduct Temp. C % Wt.LPG 1.3Light Naphtha <80 4.5Int. Naphtha 80-150 10.5Kerosine 150-230 13.5Gas Oil 230-400 32.9Residue >400 37.3Year Of Crude Oil Sample: 1996


DUBAI Dubai

Gravity: 31.0 Sulfur: 2.04 Loading Port: FatehOther Names: Fateh

Production

Output is in decline, dropping to an expected 250,000 barrels a day in 1997. Productionfrom the offshore Fateh, Faleh, Southwest Fateh, and Rashid fields peaked in 1990 atabout 415,000 b/d. Additional drilling and a limited gas injection program have helpedslow the decline, but a major gas injection program requires much larger imports, whichhave been difficult to obtain from neighboring countries and emirates at an attractiveenough price. The investment costs may also require a major adjustment to the fiscalregime.

Quality

A typical light, sour Mideast crude oil. Usually designated as a 32-gravity crude oil, butflows are a bit heavier. Although slightly heavier than Saudi benchmark Arabian Light, itis considered a reasonably good substitute by most refiners.

Producers

Dubai Producing Co.: Conoco (30%), Repsol (25%), Total (25%), Texaco (10%), Sun (5%),and Wintershall (5%). Conoco is operator. The companies receive a fixed margin on theirproduction.


Little of the crude oil is committed on a term basis, and even those volumes are usuallyresold into the Arabian Gulf�s most active spot crude oil market. The vast majority of car-goes are sold into the spot market through forward trading. While the equity producersand numerous international oil companies are active in forward trading, physical cargoesrarely move to the Atlantic Basin. However, spread trading between North Sea Brent andDubai dominates the forward market. Eastern shipments focus on Japan and shorter-haulcustomers in Singapore and the Indian subcontinent. Japan imported 46,000 b/d in 1995,down by over 40% from 1994. (See detailed discussion of the Dubai market on pB20).

Sellers

In addition to the largest equity producers, many large crude oil traders and Wall Streetfirms are active in both forward and physical Dubai trading. These include Statoil, BP,Shell, and Morgan Stanley.

Conoco Ltd.: Park House, 116 Park St., London W1Y 4NN, UK. Tel.: (44-171) 408-6000, Fax: (44-171) 408-6969.

Total Petroleum Services Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44-171) 935-3222, Fax: (44-171) 935-3102.

Repsol SA: Paseo de la Castellana 89, 28046 Madrid, Spain. Tel.: (91) 348-8100, Fax:(91) 555-7671.

Loading Port

Fateh. 25.35 N. 54.25 E. Located approximately 60 miles north-northwest off the coast ofDubai, the Fateh terminal has 2 single-point moorings. Maximum displacement is 350,000tons, with no draft restriction.


DUBAI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31 Sulfur Content % Weight 2.04Barrels /Metric Ton 7.23 Pour Point Temp. C -21Viscosity Centistokes 17.4 Reid Vapor Press. Lbs/Sq. In. 5(Kinematic) at 10 C Hydrogen Sulfide Parts/mill. 9











Pour Point Temp. C/F 27/80.6Year Of Crude Oil Sample: 1981 Viscosity (Kin) Cen at 60 C 212

AVERAGE MONTHLY DUBAI SPOT PRICES, 1987-93At Port Of Loading In Dollars Per BarrelMonth 1987 1988 1989 1990 1991 1992 1993Jan. $17.20 $15.40 $14.45 $17.45 $19.40 $15.20 $15.20 Feb. 16.70 15.05 14.60 16.80 14.45 15.75 16.00March 16.90 13.40 15.95 15.80 14.85 15.80 16.30April 16.95 14.95 16.90 14.30 15.35 16.70 16.35May 17.05 14.85 15.65 14.60 15.90 17.60 16.00June 17.25 13.80 15.40 13.25 15.40 19.00 15.60July 17.75 13.05 15.50 15.30 16.25 18.50 14.25Aug. 17.30 13.15 15.00 25.00 16.65 17.80 14.75Sept. 17.00 11.55 15.60 30.30 17.80 18.30 14.20Oct. 17.05 10.30 16.15 31.55 18.95 18.25 14.80Nov. 16.60 10.60 16.15 27.95 18.45 17.15 13.70Dec. 15.50 12.50 17.10 23.25 15.30 16.25 12.05

AVERAGE MONTHLY DUBAI-BRENT PRICE SPREAD, 1987-93Brent Minus Dubai In Dollars Per BarrelMonth 1987 1988 1989 1990 1991 1992 1993Jan. $1.20 $1.45 $2.55 $3.05 $3.85 $2.90 $2.30 Feb. 0.60 0.70 2.05 2.95 4.15 2.35 2.45March 1.00 1.35 2.75 2.85 4.00 1.85 2.55April 1.15 1.65 2.85 2.65 3.90 2.30 2.45May 1.70 1.55 2.70 2.50 3.25 2.40 2.65June 1.60 1.75 2.10 2.35 2.90 2.20 2.10July 2.05 1.85 2.25 2.40 3.20 1.85 2.55Aug. 1.65 1.80 2.10 1.95 3.15 2.00 2.05Sept. 1.35 1.75 2.20 3.30 2.70 1.95 1.95Oct. 1.75 2.15 2.85 4.00 3.20 2.10 1.90Nov. 1.20 2.40 3.00 3.95 2.85 2.10 1.65Dec. 1.60 2.65 2.60 4.05 3.05 2.05 1.55Note: More recent prices can be found in Chapter I.


MARGHAM CONDENSATE Dubai

Gravity: 50.2 Sulfur: 0.04 Loading Port: Jebel Ali

Production

About 25,000 barrels a day of condensate produced in association with natural gas froman onshore field, with rising gas output used mainly to maintain pressure in the Dubaicrude oil fields.

Quality

A full-range condensate that produces both gasoline and middle distillates, as well as asmall volume of residue.

Producers

Operator Arco holds 100%.


Rarely appears in the market, but this may be due to its small volume.

Loading Port

Jebel Ali. 25.00 N. 55.03 E. Located in the west of the emirate. A single-tanker berth iscapable of loading vessels up to 400,000 deadweight tons.


MARGHAM CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 50.2 Sulfur Content % Weight 0.04Barrels /Metric Ton 8.086 Pour Point Temp. C -8Viscosity Centistokes 1.49 Reid Vapor Press. Lbs/Sq. In. 9.8(Kinematic) at 20 C Hydrogen Sulfide Parts/mill. <5








Int. Gas Oil 300-350 7.2 8 Intermediate Gas Oil572-662 Sulfur Content % Wt. 0.27



Pour Point Temp. C/F 32/89.6Viscosity (Kin) Cen at 60 C 9.6Asphaltenes % Wt. <0.05Conradson Carbon R % Wt. 0.04Vanadium Parts/mill. <1



ORIENTE Ecuador

Gravity: 28.8 Sulfur: 1.02 Loading Port: Esmeraldas

Production

About 350,000 barrels a day of Oriente crude oil is produced mainly by statePetroecuador from the Shushufindi field and a series of smaller fields on the east side ofthe Andes Mountains which all feed into the same pipeline to the Pacific. Petroecuadoritself produces about 305,000 b/d. Up to 125,000 b/d is refined domestically, leavingabout 200,000-225,000 b/d for export. Some 40,000 b/d is also exported via Colombiabecause of the capacity limitations of the Trans-Andean pipeline.

Quality

A medium-gravity, medium-sour crude oil that is similar to US Alaskan North Slope, butwith higher metals content.

Producers

Petroecuador and a long-standing joint venture with US City Investing Co. and Oryx.Other producers include YPF�s Maxus unit, Occidental, Tripetrol, and Elf.


Petroecuador sells its crude oil exclusively on a term-contract basis, but its buyers areactively engaged in re-trading these barrels, usually in the spot market. About half thebarrels are equally divided between the US Gulf Coast and South Korea, but cargoes alsogo to the Caribbean, Latin America, and the US West Coast. Oriente is usually priced ata differential to WTI on the US Gulf Coast, but West Coast ANS prices are also used whenappropriate. Term buyers sign one-year contracts, which are bid upon by offering pre-miums to Petroecuador�s established formula. Term customers include Korean refiners,Tosco, and Texaco. Traders such as Tripetrol and Glencore often control a large shareof the exports through front companies. As a result, the 12 or so term customers actual-ly represent a smaller group.

Sellers

Petroecuador: Apartado 5007, Alpallana y Ave. 6 de Decembre, Quito, Ecuador. Tel.:(593-2) 521-436.

Tripetrol: Five Post Oak Park, Suite 2360, Houston, TX 77027. Tel.: (713) 877-8733,Fax: (713) 877-1723.

Loading Port

Esmeraldas. 01.00 N. 79.39 W. The Esmeraldas terminal, located on the coast in north-ern Ecuador, has two loading berths designed to accommodate vessels up to 200 metersin length and 10.5 m (35 feet) maximum draft.


ORIENTE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 28.8 Sulfur Content % Weight 1.02Barrels /Metric Ton 7.132 Pour Point Temp. C -3Viscosity Centistokes 13.5 Reid Vapor Press. Lbs/Sq. In. 4.5(Kinematic) at 40 C


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 1.5 1Light Naphtha <85 5.1 3.9 Light Naphtha








Residue >350 49 53.6 Residue>662 Sulfur Content % Wt. 1.62

Pour Point Temp. C/F 33/91.4Viscosity (Kin) Cen at 60 C 648Asphaltenes % Wt. 9Vanadium Parts/mill. 145


ORIENTE TERM CONTRACT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $21.00 $17.95 $14.14 $14.68 $19.02 $19.84 $14.67 $15.20 Feb. 14.00 17.02 13.54 14.83 18.53 14.58 14.75 16.52March 12.40 17.02 13.00 16.16 17.09 16.11 14.88 16.59April 12.20 17.02 14.88 18.34 13.50 16.65 16.36 16.42May 13.80 17.02 13.94 16.46 13.00 16.94 17.27 15.77June 11.55 17.02 13.30 15.87 12.17 15.97 19.09 14.84July 9.75 17.02 12.85 15.82 12.41 17.09 18.25 13.66Aug. 13.45 17.02 12.65 15.04 22.44 17.35 17.45 14.16Sept. 13.45 17.02 11.42 15.58 29.76 18.11 17.92 13.41Oct. 13.65 18.45 10.33 16.57 30.61 18.98 18.05 13.88Nov. 13.85 17.40 10.23 16.77 28.00 17.83 16.82 12.07Dec. 15.10 15.50 12.85 18.28 23.45 15.34 15.84 10.18

ORIENTE SPOT PRICES, 1988-93Delivered To US Gulf Coast In Dollars Per BarrelMonth 1988 1989 1990 1991 1992 1993Jan. $17.95 $15.45 $16.50 $22.90 $15.85 $16.55 Feb. 16.90 14.65 16.65 17.05 15.90 18.30March 17.45 14.10 17.90 18.00 16.25 18.15April 15.35 20.05 15.00 18.45 17.65 18.05May 15.45 18.15 14.75 17.45 18.45 17.55June 14.70 17.50 13.40 17.40 20.55 16.60July 14.65 17.50 15.95 18.15 19.75 15.30Aug. 14.00 16.55 25.70 18.40 18.85 15.60Sept. 13.05 17.10 32.20 19.05 19.30 15.15Oct. 11.80 17.90 32.90 20.10 19.65 15.55Nov. 11.80 18.25 30.65 19.40 18.60 13.55Dec. 14.30 19.80 26.05 16.85 17.55 11.75Note: More recent prices can be found in Chapter I.


BELAYIM BLEND Egypt

Gravity: 26.1 Sulfur: 2.23 Loading Port: Wadi El Firan

Production

200,000 barrels a day from both onshore and offshore fields in the Gulf Of Suez. Originaldiscovery of Belayim Marine field in 1955 by Agip. Output has been maintained at theselevels after steady increases in the late 1980s and early 1990s.

Quality

Heavy, high-sulfur crude oil with high metals content, similar to heavier Venezuelan andMexican grades.

Producers

Petrobel: a joint venture operated by state EGPC (50%), Italian Agip (35%), and localinterests (15%).


The EGPC term price formula was changed to direct Brent linkage in January 1996 dueto dissatisfaction with the earlier basket mechanism. EGPC has increased its terms saleson the international market and reduced usage in domestic refineries as it seeks to makemore light products. It has also reduced its reliance on traders and increased sales torefiners. Agip takes almost all of its 60,000-70,000 b/d share of production � about fourcargoes a month � into its Italian refinery system.

Sellers

EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899.Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-921, Fax: (39-6)

503-922-41/503-923-20.

Loading Port

Wadi El Firan. 28.44 N. 33.13 E. The terminal is located on the Sinai coast in the Gulfof Suez in the Red Sea about 100 miles south of Suez. Loading facilities include threeberths. Maximum draft and deadweight tons are the following: Berth 1, 75 feet and50,000 dwt; Berth 2, 58 ft and 50,000 dwt; Berth 3, 65 ft and 80,000 dwt.


BELAYIM BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 26.1 Sulfur Content % Weight 2.23Barrels /Metric Ton 7.012 Pour Point Temp. C 9Viscosity Centistokes 29.5 Reid Vapor Press. Lbs/Sq. In. 4.5(Kinematic) at 100 F



<185 Octane RON Clear Octane 65Int. Naphtha 85-165 12 10 Intermediate Naphtha






Cloud Point Temp. C 14Cetane Index 54.8Viscosity (Kin) Cen at 100 F 6.4

Residue >350 56 61 Residue>662 Sulfur Content % Wt. 3.18

Viscosity (Kin) Cen at 60 C 761Asphaltenes % Wt. 7.32Conradson Carbon R % Wt. 14.74Vanadium Parts/mill. 161


BELAYIM BLEND TERM-CONTRACT PRICES, 1979-93At Port Of Loading In Dollars Per BarrelMonth 1979 1980 1981 1982 1983 1984 1985Jan. $12.23 $29.00 $37.00 $30.50 $28.00 $26.50 $25.60 Feb. 12.23 29.00 37.00 28.65 27.00 25.00 25.75March 15.05 29.00 37.00 28.00 25.25 26.75 25.75April 15.32 29.00 35.50 28.00 25.25 25.60 25.75May 15.32 29.00 33.00 28.00 25.75 25.60 26.00June 17.60 29.00 33.00 28.50 26.00 25.60 23.00July 26.50 29.00 30.00 28.50 26.25 25.60 24.25Aug. 26.50 29.00 30.00 28.50 26.25 25.60 24.25Sept. 26.50 29.00 30.00 28.50 26.75 25.60 24.55Oct. 26.50 29.00 30.00 28.60 26.75 25.60 25.00Nov. 26.50 29.00 31.40 29.00 26.75 25.60 25.00Dec. 28.00 31.00 31.00 28.75 26.75 25.60 25.45Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $21.50 $16.52 $14.60 $13.28 $18.28 $20.11 $13.11 $13.01 Feb. 18.00 16.84 14.58 13.90 17.35 15.66 13.16 13.72March 12.50 16.65 12.78 14.85 15.70 15.17 12.79 13.96April 11.75 16.65 13.70 16.55 12.93 15.33 14.28 13.89May 11.25 16.65 14.43 16.67 13.58 14.54 15.28 13.74June 11.25 16.65 13.75 14.80 11.65 13.78 16.49 12.85July 11.25 16.90 11.90 15.03 12.15 14.75 15.72 12.07Aug. 10.44 17.63 12.85 14.15 24.11 15.35 15.26 12.15Sept. 12.05 16.32 11.53 14.73 35.10 16.03 15.88 11.68Oct. 11.68 15.85 10.30 16.15 33.02 17.49 16.09 12.37Nov. 12.83 15.55 10.05 16.15 29.15 16.24 15.24 11.08Dec. 13.58 15.05 11.90 17.28 23.05 13.21 14.16 9.66Note: More recent prices can be found in Chapter I.


RAS BUDRAN Egypt

Gravity: 24.3 Sulfur: 2.39 Loading Port: Ras Budran

Production

Output is in decline, with less than 20,000 barrels a day in 1995 from the Ras Budran off-shore field along the northern Sinai Coast of the Gulf of Suez.

Quality

A heavy, high-sulfur crude oil with high metals content, similar in quality to heavyMexican and Venezuelan crude oils.

Producers

Suez Oil Co. (Suco): state EGPC (50%), with the remaining 50% shared equally amongShell, Repsol, and Deminex.


The EGPC term price formula was changed to direct Brent linkage in January 1996 dueto dissatisfaction with the earlier basket mechanism. Use of these heavier crude oils inEGPC refineries has been reduced in favor of lighter Suez Blend in order to producemore light products. The crude oil�s primary markets are in the Mediterranean and withsophisticated US refiners.

Sellers

EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899.

Loading Port

Ras Budran. 26.56 N. 33.08 E. The crude oil-loading facilities at Ras Budran in the RedSea consist of one single-buoy mooring. Size restrictions are 250,000 deadweight tonsand draft of 27.4 meters.


RAS BUDRAN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 24.3 Sulfur Content % Weight 2.39Barrels /Metric Ton 6.931 Pour Point Temp. C 9Viscosity Centistokes 52.06 Reid Vapor Press. Lbs/Sq. In. 5(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1













RAS BUDRAN TERM-CONTRACT PRICES, 1987-93

At Port Of Loading In Dollars Per BarrelMonth 1987 1988 1989 1990 1991 1992 1993Jan. $16.02 $14.10 $12.13 $17.13 $18.96 $11.51 $11.66 Feb. 16.27 13.60 12.75 16.20 14.51 11.56 12.47March 16.00 12.28 13.70 14.55 14.02 11.19 12.90April 16.00 13.00 15.10 11.78 14.18 12.68 12.84May 16.00 13.20 15.22 12.43 13.24 13.68 12.74June 16.15 12.85 13.35 10.50 12.48 14.89 11.90July 16.40 10.75 13.58 11.00 13.45 14.12 11.22Aug. 17.13 11.70 13.00 22.96 15.05 13.76 11.35Sept. 15.82 10.38 13.58 33.95 15.73 14.38 10.88Oct. 15.35 9.15 14.70 31.77 17.29 14.59 11.57Nov. 14.95 8.90 14.70 28.00 16.04 13.74 10.33Dec. 14.55 10.75 16.13 22.90 11.91 12.66 8.86Note: More recent prices can be found in Chapter I.


RAS GHARIB BLEND Egypt

Gravity: 24.1 Sulfur: 3.00 Loading Port: Ras GharibOther Names: Ras Gharib, Gharib Blend

Production

About 25,000 barrels a day from the Gharib field and others nearby on the west side ofthe Gulf Of Suez. The Gharib field is Egypt�s oldest. It was discovered in 1938, and it stillproduces 5,000 b/d.

Quality

A heavy, high-sulfur crude oil similar in quality to heavier Mexican and Venezuelancrude oils. It is now slightly lighter than the sample below.

Producer

General Petroleum Co. (GPC): an affiliate of state EGPC. Operated by Gulf Of SuezPetroleum Co. (Gupco), a joint venture between Amoco and EGPC.


The EGPC term price formula was changed to direct Brent linkage in January 1996 dueto dissatisfaction with the earlier basket mechanism. Ras Gharib has long been one ofEGPC�s primary export grades after Suez Blend, with most sales on a term-contract basis.Its primary markets are in the Mediterranean and with sophisticated US refiners.

Seller


Loading Port

Ras Gharib. 28.21 N. 33.07 E. Located in the Gulf of Suez with two piers for crude oiltankers. Pier 2 is for ships up to 30,000 deadweight tons with maximum draft of 36 feet.New Pier is for ships up to 100,000 dwt and maximum draft of 78 ft.


RAS GHARIB BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 22 Sulfur Content % Weight 3.1Barrels /Metric Ton 6.838 Pour Point Temp. F 50Viscosity Centistokes 70(Kinematic) at 40 C





Heavy Naphtha 300-400 7 Heavy NaphthaNaphthenes % Wt. 42Aromatics % Wt. 14


Gas Oil 500-650 12.6 Gas OilSulfur Content % Wt. 2.23Cetane Index 48Viscosity (Kin) Cen at 50 C 3.77


Year Of Crude Oil Sample: 1983 Viscosity (Kin) Cen at 50 C 6,100

RAS GHARIB BLEND TERM CONTRACT PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. ... $11.40 $24.00 $32.00 $27.80 $26.00 $24.65 $25.60 Feb. ... 11.40 24.00 32.00 26.65 25.00 25.00 25.75March ... 14.06 24.00 32.00 26.00 23.00 25.00 25.75April ... 14.33 24.00 31.50 26.00 23.00 25.60 25.75May ... 14.33 24.00 30.00 26.00 23.25 25.60 25.00June ... 16.90 24.00 30.00 26.50 23.25 25.60 23.00July ... 21.00 24.00 27.00 26.50 23.50 25.60 22.25Aug. ... 21.00 24.00 27.00 26.50 23.50 25.60 22.25Sept. ... 21.00 24.00 27.00 26.50 24.50 25.60 23.25Oct. $10.73 21.00 24.00 27.00 26.50 24.50 25.60 23.50Nov. 10.73 21.00 24.00 28.30 26.75 24.50 25.60 23.50Dec. 10.73 24.00 26.00 28.00 26.25 24.50 25.60 23.85Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $19.70 $15.40 $13.50 $11.83 $16.83 $18.66 $11.21 $11.11 Feb. 16.50 15.72 14.15 12.45 15.90 14.21 11.26 11.82March 11.25 15.40 11.68 13.40 14.25 13.72 10.89 12.10April 11.25 15.40 12.35 15.40 11.48 13.88 12.28 12.04May 10.60 15.40 14.00 15.52 12.13 13.09 13.28 11.94June 10.60 15.55 12.15 13.65 10.20 12.33 14.49 11.10July 10.60 15.80 10.45 13.88 10.70 13.30 13.72 10.42Aug. 9.19 16.53 11.40 12.70 22.66 14.90 13.26 10.55Sept. 10.00 15.22 10.08 13.28 33.65 15.58 13.88 10.08Oct. 10.43 14.75 8.85 15.00 31.47 17.29 14.09 10.77Nov. 10.65 14.45 8.60 15.00 27.70 14.79 13.24 9.53Dec. 12.33 13.95 10.45 15.83 22.60 11.96 12.16 8.06Note: More recent prices can be found in Chapter I.


SUEZ BLEND Egypt

Gravity: 31.5 Sulfur: 1.54 Loading Port: Ras ShukheirOther Names: El Morgan, Gulf of Suez

Production

About 400,000 barrels a day, from the main fields of Morgan, October, and Ramadan.Output is declining gradually, but still represents almost half of Egypt�s total production.

Quality

A medium-gravity, sour crude oil similar in quality to Arabian Light and Russian Urals.Usually referred to as a 33-gravity crude oil, although it is actually somewhat heavier, asthe test below indicates.

Producers

Gulf Of Suez Petroleum Co. (Gupco), in which Amoco and state EGPC each have 50%equity ownership.


Suez Blend exports have been declining as EGPC has refined more of it locally in orderto expand light products output. As a result, exports have dwindled to about 175,000 b/dfrom about 225,000 b/d in the early 1990s. EGPC only exports about 50,000 b/d againsttotal EGPC crude oil sales of 170,000-180,000 b/d. Amoco sells about 75% of its 125,000b/d of exports on a term-contract basis, with the remainder sold spot. Spot trading hasdeclined with reduced exports and a greater emphasis on term sales to refiners, reduc-ing the role of Suez Blend as a Mediterranean spot benchmark grade. EGPC term con-tract prices moved to a simple dated Brent formula in January 1996, when the old crudeoil basket system was abandoned.

Sellers

EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899.Amoco Shipping and Trading: 140 Park Lane, Suite 23, London SW1X 9NE, UK.

Tel.: (44-171) 408-1750, Fax: (44-171) 409-0785.

Main Customers

Egypt�s largest customer is Israel, but EGPC also maintains about 15 term contracts,including major oil companies and Mediterranean refiners. Chevron and Shell droppedout in 1996. Volumes also regularly move to India and other Asian destinations.

Loading Port

Ras Shukheir. 28.08 N. 33.17 E. The terminal is on the western coast of the Gulf Of Suezand consists of two sea berths. Maximum draft is 25.6-27.4 meters, with maximum lengthof 305 meters.


SUEZ BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31.5 Sulfur Content % Weight 1.54Barrels /Metric Ton 7.255 Pour Point Temp. C 3Viscosity Centistokes 5.4 Reid Vapor Press. Lbs/Sq. In. 6.1(Kinematic) at 40 C


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <5/<41 2.5 1.6Light Naphtha <85 6.6 5.1 Light Naphtha











SUEZ BLEND SPOT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $22.70 $17.12 $15.45 $14.13 $19.13 $20.96 $15.06 $14.41 Feb. 19.00 17.44 15.00 14.75 18.20 16.51 15.11 15.22March 13.50 17.25 13.63 15.70 16.55 16.02 14.74 15.44April 12.50 17.25 14.55 17.40 13.78 16.18 16.13 15.34May 12.00 17.25 14.85 17.52 14.42 15.94 17.08 15.19June 11.00 17.25 14.60 15.65 12.50 15.18 18.24 14.25July ... 17.55 12.75 15.88 13.00 16.15 17.42 13.47Aug. 11.16 18.33 13.70 15.00 24.96 16.75 16.91 13.55Sept. 12.80 17.10 12.38 15.58 35.95 17.43 17.48 13.08Oct. 12.42 16.70 11.15 17.00 33.87 19.29 17.64 13.72Nov. 12.40 16.40 10.90 17.00 30.00 18.04 16.74 12.43Dec. 14.18 15.90 12.75 18.12 24.90 15.11 15.56 11.01

SUEZ BLEND TERM-CONTRACT PRICES, 1987-93Month 1987 1988 1989 1990 1991 1992 1993Jan. $16.95 $14.95 $14.50 $18.85 $20.25 $15.05 $14.15 Feb. 16.25 14.25 14.40 17.30 16.50 15.10 15.10March 16.65 12.95 16.20 15.70 15.85 14.70 15.55April 17.00 14.55 17.95 13.55 16.00 16.25 15.30May 17.15 14.40 16.50 13.20 15.85 17.10 15.10June 17.25 13.50 15.20 11.70 14.60 18.20 14.75July 17.95 12.85 15.25 13.95 16.00 17.45 13.45Aug. 17.55 12.85 14.50 25.00 16.55 16.85 13.55Sept. 16.65 11.05 15.55 33.80 17.45 17.40 13.00Oct. 16.70 10.15 16.65 33.20 19.20 17.75 13.65Nov. 15.70 10.75 16.40 29.30 18.10 16.70 12.40Dec. 14.80 13.15 17.50 24.35 15.15 15.35 10.90Note: More recent prices can be found in Chapter I.


ZEIT BAY Egypt

Gravity: 33.8 Sulfur: 1.35 Loading Port: Zeit Bay

Production

Output is declining and was less than 20,000 barrels a day in 1995 from a group of off-shore fields at the southern end of the Gulf of Suez.

Quality

A medium, sour crude oil that is slightly higher in quality than benchmark Suez Blend.

Producers

Suez Oil Co. (Suco): state EGPC (50%), with the remaining 50% shared equally amongShell, Repsol, and Deminex.


The EGPC term price formula was changed to direct Brent linkage in January 1996 dueto dissatisfaction with the earlier basket mechanism. Use of lighter grades such as ZeitBay has been increased in EGPC refineries in order to produce more light products,which limits export availabilities. The crude oil�s primary markets are in theMediterranean.

Sellers


Loading Port

Zeit Bay. 27.50 N. 33.36 E. Located about 35 miles north of Hurgada in the Red Sea, theterminal is equipped with one single-buoy mooring. The maximum vessel size is 240,000deadweight tons.


ZEIT BAY ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 33.8 Sulfur Content % Wt 1.35Barrels /Metric Ton 7.355 Pour Point Temp. C -6Viscosity Centistokes 5.73 Reid Vapor Press. Lbs/Sq. In. 8.3(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <5/<41 3.8 2.5Light Naphtha <85 9.3 7.2 Light Naphtha






Int. Gas Oil 300-350 7.6 7.7 Intermediate Gas Oil572-662 Sulfur Content % Wt. 1

Cloud Point Temp. C 2Cetane Index 54.5Viscosity (Kin) 104 F 5.79





LUCINA Gabon

Gravity: 39.2 Sulfur: 0.03 Loading Port: Lucina

Production

A small offshore stream of 8,000 barrels a day of light, sweet crude oil. Output comesfrom the two Lucina fields and adjacent M�Baya, which was tied in by pipeline in 1996.

Quality

Gabon�s highest-quality oil is somewhat less attractive than other top West African crudeoils such as Nigerian Bonny Light because of its high wax content and pour point. Theassay is for Lucina with M�Baya slightly heavier at 36-gravity.

Producers

Perenco (formerly Kelt) is the operator with 90% and the government holds the remain-ing 10%. The fields were acquired from Elf, Shell, and Repsol in 1994-95.


Cargoes are priced at a differential to dated Brent, with a typical discount of 25¢-50¢ abarrel. Lucina is sold in 50,000- to 100,000-ton parcels on the spot market, usually intoEurope.

Sellers

Perenco (formerly Kelt): 130 Jermyn Street, London SW1Y 4UJ, UK. Tel. (44-171) 930-9861. Fax: (44-171) 873-0908.

Loading Port

Lucina. 03.40 S. 10.46 E. The terminal is in the South Atlantic and consists of a single-buoy mooring located 1 kilometer from the floating-storage vessel that is moored nearthe offshore production platforms. No limitation on tanker size.


LUCINA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.2 Sulfur Content % Weight 0.03Barrels /Metric Ton 7.597 Pour Point Temp. C 18Viscosity Centistokes 4.82 Reid Vapor Press. Lbs/Sq. In. 6.5(Kinematic) at 40 C











Pour Point Temp. C/F 42/107.6Viscosity (Kin) Cen at 60 C 51.4Asphaltenes % Wt. <0.05Conradson Carbon R % Wt. 3.19Vanadium Parts/mill. <1



MANDJI Gabon

Gravity: 30.2 Sulfur: 1.14 Loading Port: Cape Lopez

Production

About 120,000 barrels a day of offshore output from several fields, and Gabon�s second-largest stream after the onshore Rabi system.

Quality

A medium-gravity crude oil with a higher sulfur content than most West African grades.Similar in quality to US Alaskan North Slope. Quality may vary as new streams arebrought on and old ones decline.

Producers

Elf-Gabon: a joint venture between French Elf Aquitaine (75%) and the government(25%).


Sales are tied to a dated Brent formula with a discount of about $2-$2.75 a barrel. Elfhandles all of the marketing, and the firm also sometimes takes significant volumes intoits own refining system. Volumes are increasingly being sold into Asia.

Sellers

Elf Trading: World Trade Center, 10 Route de l�Aeroport, 1215 Geneva 15 Airport,Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110.

Loading Port

Cape Lopez. 00.38 S. 08.43 E. The terminal, located about 100 miles south of Libreville,is designed for tankers of up to 250,000 deadweight tons with maximum drafts of 67 feet(20.5 meters).


MANDJI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 30.2 Sulfur Content % Weight 1.14Barrels /Metric Ton 7.197 Pour Point Temp. C 12Viscosity Centistokes 13.9 Reid Vapor Press. Lbs/Sq. In. 4.3(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <5/<41 1.5 1Light Naphtha 5-85 5.1 4.1 Light Naphtha









Pour Point Temp. F 99Viscosity (Kin) Cen at 60 C 334Asphaltenes % Wt. 2.12Conradson Carbon R % Wt. 7.81Vanadium Parts/mill. 107


MANDJI OFFICIAL GOVERNMENT SELLING PRICES, 1978-85At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $12.70 $13.23 $28.00 $35.00 $30.50 $33.00 $26.50 $28.00Feb. 12.70 13.23 30.00 35.00 28.65 27.00 25.00 25.75March 12.70 15.05 30.00 35.00 28.00 29.00 26.75 25.75April 12.70 16.00 30.00 35.50 28.00 29.00 25.60 25.75May 12.70 16.80 32.00 33.00 28.00 25.75 25.60 26.00June 12.70 18.10 32.00 33.00 28.50 26.00 25.60 23.00July 12.70 22.00 32.00 30.00 28.50 26.25 25.60 24.25Aug. 12.70 22.00 32.00 30.00 28.50 26.25 25.60 24.25Sept. 12.70 22.00 32.00 30.00 28.50 26.75 25.60 24.55Oct. 11.57 22.00 32.00 30.00 28.60 26.75 25.60 25.00Nov. 11.57 24.50 32.00 31.30 29.00 26.75 25.60 25.00Dec. 11.57 28.00 31.00 31.00 28.75 26.75 25.60 25.45

MANDJI SPOT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $21.50 $17.35 $14.75 $15.40 $19.45 $20.35 $15.00 $14.60Feb. 18.00 17.32 13.60 15.25 17.75 16.25 15.25 15.65March 12.50 17.32 12.75 16.95 16.25 15.05 14.85 16.10April 11.75 17.32 13.65 18.60 13.70 15.50 16.45 16.15May 11.25 17.32 14.20 17.05 13.40 15.25 17.40 16.20June 10.50 17.32 13.35 16.00 11.80 14.70 18.60 15.40July 7.95 17.32 13.15 15.85 14.15 15.85 17.90 14.65Aug. 11.90 17.32 12.70 14.85 25.15 16.45 17.55 14.30Sept. 12.40 17.32 11.30 16.00 32.10 17.35 18.00 13.70Oct. 12.30 17.32 10.60 17.15 32.60 19.45 18.15 14.50Nov. 12.80 17.32 11.25 16.90 28.90 18.25 17.15 13.10Dec. 14.25 17.32 13.65 18.00 24.00 15.25 16.00 11.65Note: More recent prices can be found in Chapter I.


RABI Gabon

Gravity: 34.6 Sulfur: 0.06 Loading Ports: Gamba (Shell), Cape Lopez (Elf)Other Names: Rabi Kounga, Rabi Export Blend, Rabi Light

Production

At 220,000 barrels a day in 1996, Rabi is still Gabon�s largest and most important pro-ducing area. The fields are undergoing infill drilling and other efforts to maintain flows,but output is expected to decline gradually in the years ahead. The area lies 60 milesinland, with several adjacent fields contributing to the export streams. It is split into twoslightly different streams for export. Shell�s Rabi Export Blend is mixed with heavier 31-gravity Gamba crude oil and other lighter streams, while Elf�s Rabi Light is not.

Quality

A medium-gravity, low-sulfur crude oil with relatively high wax content, making it sim-ilar to Angolan Cabinda but of higher quality. The test below is representative of Elf�sRabi Light stream rather than Shell�s Rabi Export Blend, but both are quite similar.

Producers

Shell-Gabon (75% Royal Dutch/Shell, 25% government) and Elf-Gabon (75% French ElfAquitaine, 25% government) are the dominant partners, and they operate different partsof the producing area. Shares are Elf-Gabon (48%), Shell-Gabon (32%), state Petrogab(15%), and Amerada Hess (5%).


Rabi is usually priced at a differential to Brent even though most volumes go to the USor Asia. It is sold regularly on a spot market basis by both Shell and Elf. Shell sells itsoutput from the loading port of Gamba in central Gabon, while Elf pipes its barrels toCape Lopez, 110 miles northwest. Both grades typically sell at a discount to Brent of 10¢-20¢ a barrel.

Sellers

Royal Dutch/Shell: Shell International Trading And Shipping Co. (Stasco), Shell-MexHouse, Strand, London WC2R 07A, UK. Tel.: (44-171) 546-1234, Fax: (44-171) 546-4448.

Elf Trading: World Trade Center, 10 Route de l�Aeroport, 1215 Geneva 15 Airport,Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110.

Main Customers

Rabi is actively traded in the Atlantic Basin and the Far East, but it appeals to specificend-users because of its quality. Exxon, Chevron, Phibro, British Petroleum, and Coastalhave been among the largest US buyers. But since late 1992, Rabi has also moved to theFar East as a substitute for similar quality Asian grades.

Loading Ports

Gamba. 02.50 S. 09.56 E. This Shell operated terminal consists of a single-buoy mooringfor vessels up to 130,000 deadweight tons with maximum draft of 41 feet (12.5 meters).Cape Lopez. 00.38 S. 08.43 E. This Elf terminal, located about 100 miles south of Libreville,is designed for tankers of up to 250,000 dwt with maximum drafts of 67 ft (20.5 m).


RABI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 34.6 Sulfur Content % Weight 0.06Barrels /Metric Ton 7.391 Pour Point Temp. C 33Viscosity Centistokes 12.9 Reid Vapor Press. Lbs/Sq. In. 3.3(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG <5/<41 0.8 0.5Light Naphtha <85 2.7 2.2 Light Naphtha












ARDJUNA Indonesia

Gravity: 36.7 Sulfur: 0.09 Loading Port: ArdjunaOther Names: Arjuna

ProductionOutput of about 80,000 barrels a day in 1995 from some 20 small offshore fields on thenorthern edge of western Java. Arimbi and Bima crude oil streams also come from thesame block. Production peaked in the mid-1980s, and it is expected to drop to about50,000 b/d by 2000, even with enhanced-recovery efforts.

QualityTypical light Asian crude oil with little sulfur but high wax content. The high-pour-pointresidual oil is viscous and difficult to handle even by Indonesian standards.

ProducersOperator Arco (46%), Maxus (24.3%), Repsol (12.3%), Inpex (7.3%), Deminex (5%),Itochu (2.6%), Warrior Oil (2.4%). Production split is 85-15 in favor of Pertamina afterallowing for cost-recovery oil going to producers and excluding set volumes that pro-ducers must sell to the domestic market at discounted prices.

Pricing And MarketingExports amount to no more than 15,000-20,000 b/d as compared to 40,000 b/d in themid-1980s. The drop is due to declining production and greater use of the crude oil inIndonesian refineries.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first componentis linked to the average prices for five spot crude oils � Indonesian Minas, MalaysianTapis, Australian Gippsland, Dubai, and Oman � over the calendar month as reportedby the Asian Petroleum Price Index. The average differential between the basket and thespot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weight-ing for the term-contract price. The second 50% component is the average of Ardjunaspot prices over the month in Platt's and Rim. These two components are averaged toarrive at the final ICP price.

SellersIn addition to any volumes sold by equity producers, Pertamina sells the crude oil viafour marketing affiliates. For sales to Japan, Indonesia�s largest market, Pacific PetroleumAnd Trading Company is used, a 50-50 joint ventures between Pertamina and Japanesebuyers. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), andsales to China go through Perta.

Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower,17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3)5562-6504.

Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul,Korea 10010. Tel: (822) 752-0592. Fax: (822) 752-0596.

Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong.Tel: (852-5) 260-341. Fax: (852-5) 2519-8909.

Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel:(62-21) 525-0120.

Loading PortArdjuna. 05.54 S. 107.44 E. This open mooring in the Java Sea, situated 18.5 miles offthe north coast of Java, has a total of four single-buoy mooring berths intended for crudeoil loading. It is designed for tankers of up to 200,000 deadweight tons. Crude oil isstored in storage tankers Arco Ardjuna, Ardjuna Sakti, and Cempaka Nusantra.


ARDJUNA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.7 Sulfur Content % Weight 0.09Barrels /Metric Ton 7.5 Pour Point Temp. F 70Viscosity Centistokes 5.27 Reid Vapor Press. Lbs/Sq. In. 6.6(Kinematic) at 100 F


Cut Points YieldProduct Temp. C % Vol. Properties Unit ValueLight Naphtha <100 14.3 Light Naphtha

Octane RON Clear Octane 75.2Int. Naphtha 100-150 13 Intermediate Naphtha

Paraffins % Wt. 35Naphthenes % Wt. 44Aromatics % Wt. 21.5

Kerosine 150-250 19.3 KerosineSmoke Point mm 14Freezing Point Temp. C -54

Gas Oil 250-350 22.4 Gas OilCetane Index 43.9

Residue >350 31 ResidueSulfur Content % Wt. 0.17


ARDJUNA OFFICIAL TERM-CONTRACT PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.70 $14.40 $28.95 $36.45 $36.45 $35.20 $30.20 $30.20 Feb 13.70 14.40 30.95 36.45 36.45 30.20 30.20 28.65March 13.70 14.40 30.95 36.45 36.45 30.20 30.20 28.65April 13.70 16.45 30.95 36.45 36.45 30.20 30.20 28.65May 13.70 17.20 32.95 36.45 36.45 30.20 30.20 28.65June 13.70 19.70 32.95 36.45 36.45 30.20 30.20 28.65July 13.70 21.56 32.95 36.45 36.45 30.20 30.20 28.65Aug. 13.70 21.56 32.95 36.45 36.45 30.20 30.20 28.65Sept. 13.70 21.56 32.95 36.45 36.45 30.20 30.20 28.65Oct. 13.70 21.56 32.95 36.45 36.45 30.20 30.20 28.65Nov. 13.70 23.50 32.95 36.45 35.20 30.20 30.20 28.65Dec. 13.70 26.70 32.95 36.45 35.20 30.20 30.20 28.65Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $28.65 $17.55 $18.09 $15.53 $19.47 $25.59 $18.89 $18.40 Feb. 28.65 18.09 18.09 18.09 19.51 21.98 18.47 17.96March 12.85 18.09 17.99 18.09 18.97 17.97 17.97 18.84April 11.00 18.09 16.53 18.47 17.63 17.65 18.07 19.23May 12.25 18.09 17.13 18.88 16.46 19.29 18.83 18.99June 11.75 18.09 16.98 18.29 15.71 18.59 20.18 18.62July 9.85 18.09 16.98 18.17 14.95 18.36 21.38 17.57Aug. 12.10 18.09 15.33 17.39 19.32 19.80 20.94 17.65Sept. 13.70 18.09 15.33 17.21 28.15 19.29 20.38 17.07Oct. 13.65 18.09 13.73 17.61 35.39 20.85 20.46 17.17Nov. 13.75 18.09 12.63 18.13 33.64 21.50 20.14 16.12Dec. 14.65 18.09 13.03 18.35 29.07 20.86 19.31 14.58Note: More recent prices can be found in Chapter I.


ARUN CONDENSATE Indonesia

Gravity: 54.3 Sulfur: >0.01 Loading Port: Lhokseumawe

Production

About 90,000 barrels a day in association with gas produced for Arun liquefied naturalgas exports, and volumes have been declining as the gas becomes drier. Output isexpected to hit 20,000 b/d or so by 2000.

Quality

A high-quality, naphtha-rich condensate excellent for gasoline manufacturing or blend-ing with heavy crude oils to improve refined product yield.

Producer

Operated by Mobil under a production-sharing contract with state Pertamina. Productionis split 70-30 in favor of Pertamina.


Almost the entire production is exported, making it the third-largest export stream afterMinas and Duri, with a wide range of buyers. Mobil handles sales on behalf of Pertamina.Since liquids production is linked to LNG facilities, output cannot be shut in without dis-rupting gas supply.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first component islinked to the average prices for five spot crude oils � Indonesian Minas, Malaysian Tapis,Australian Gippsland, Dubai, and Oman � over the calendar month as reported by theAsian Petroleum Price Index. The average differential between the basket and the spotprice of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting forthe term-contract price. The second 50% component is the average of spot prices over themonth in Platt's and Rim. The two components are averaged to arrive at the final ICPprice.

Sellers

In addition to absorbing supplies within its own refining system, Mobil markets about30,000-40,000 b/d to third parties, acting as a marketing agent for Pertamina. Pertaminaalso sometimes sells about 10,000-20,000 b/d through its Japanese marketing affiliate (seeArdjuna for details).

Mobil Sales & Supply Corp., Singapore: 18 Pioneer Road, 2262 Singapore. Tel.:(65) 660-6401, Fax: (65) 264-1693.

Loading Port

Lhokseumawe. 05.15 N. 97.07 E. The terminal is located on the north coast of Sumatra,and it contains several oil-loading berths, in addition to LNG-loading facilities. The sin-gle-buoy mooring facility is designed for tankers of 40,000-280,000 deadweight tons.


ARUN CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 54.3 Sulfur Content % Weight 0.002Barrels /Metric Ton 8.28 Pour Point Temp. F -20Viscosity Centistokes 0.83 Reid Vapor Press. Lbs/Sq. In. 9.3(Kinematic) at 104 F


Cut Points YieldProduct Temp. C % Vol. Properties Unit ValueLPG 7.3Light Naphtha <100 24.1Int. Naphtha 100-150 31.7 Intermediate Naphtha

Paraffins % Wt. 42Naphthenes % Wt. 38.5Aromatics % Wt. 19.5


Gas Oil 250-350 13.2 Gas OilCetane Index 53




ATTAKA Indonesia

Gravity: 42.3 Sulfur: 0.09 Loading Port: Santan

ProductionAbout 50,000 barrels a day from fields that lie mostly offshore eastern Kalimantan(Borneo) under a production-sharing contract with state Pertamina.

QualityLight, low-sulfur crude oil with a high light-product yield and an unusually low pour pointfor an Indonesian grade. Despite the crude oil�s low wax content, it still produces a waxyresidual oil with a high pour point. Sometimes sold as a blend with Badak crude oil.

ProducersOperator Unocal (50%) with Japanese Inpex (50%). Production split is 85-15 in favor ofPertamina after allowing for cost-recovery oil going to producers and excluding set vol-umes that producers must sell to the domestic market at discounted prices.

Pricing And MarketingExports have risen to about 40,000 b/d as less of the grade is being absorbed locally at theCilacap refinery on Java. Japan alone accounts for about 15,000 b/d of Attaka purchases.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first component islinked to the average prices for five spot crude oils � Indonesian Minas, Malaysian Tapis,Australian Gippsland, Dubai, and Oman � over the calendar month as reported by theAsian Petroleum Price Index. The average differential between the basket and the spot priceof Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of spot prices over the month inPlatt's and Rim. These two components are averaged to arrive at the final ICP price.

SellersIn addition to any volumes sold by equity producers, Pertamina sells the crude oil viafour marketing affiliates. For sales to Japan, Indonesia�s largest market, Pacific PetroleumAnd Trading Company is used, a 50-50 joint ventures between Pertamina and Japanesebuyers. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco) andsales to China go through Perta.





Unocal International Supply & Trading Co.: Jakarta Representative Office, MuliaTower, Suite 1511, Jl. Jendral Gatot Subroto Kav. 9-11, Jakarta 1293, Indonesia. Tel.: (62-21) 517-274, Fax: (62-21) 517-276.

Loading PortSantan. 00.07 S. 117.32 E. The Santan terminal, located on the east coast of Kalimantanabout 80 miles north of Balikpapan, consists of a single-point mooring loading berthapproximately 4.3 miles offshore in about 87 feet (28 meters) of water. Size restrictionsare a minimum of 18,000 deadweight tons and a maximum of 125,000 dwt.


ATTAKA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 42.3 Sulfur Content % Weight 0.09Barrels /Metric Ton 7.74 Pour Point Temp. F -10Viscosity Centistokes 1.45 Reid Vapor Press. Lbs/Sq. In. 6.8(Kinematic) at 100 F



Octane RON Clear Octane 74.9Int. Naphtha 100-150 17.6 Intermediate Naphtha

Paraffins % Wt. 41Naphthenes % Wt. 35Aromatics % Wt. 24.7


Gas Oil 250-350 25 Gas OilCetane Index 52.6



ATTAKA OFFICIAL TERM-CONTRACT PRICES, 1978-93



BELIDA Indonesia

Gravity: 40.0 Sulfur: 0.01 Loading Port: Belida

Production

The first major light, sweet crude oil find in Indonesia in more than a decade began pro-duction at the end of 1992 from an offshore field in the South China Sea that lies southof Natuna Island. Output was about 115,000 barrels a day in 1995, up from 75,000 b/din 1992.

Quality

Asian-type light, low-sulfur crude oil with high wax content.

Producers

Operator Conoco (40%) with Texaco (25%), Chevron (17.5%), and Japan�s Inpex (17.5%).Production split 85-15 in favor of Pertamina after allowing for cost-recovery oil going toproducers and excluding set volumes that producers must sell to the domestic market.


About 65,000-70,000 b/d is exported to a wide variety of customers with cargoes goingto Australia, Singapore, the US West Coast, and Japan.

Pricing is based on a complex retroactive formula known as the ICP or IndonesianContract Price. This formula has two components of equal weight. The first component islinked to the average prices for five spot crude oils � Indonesian Minas, Malaysian Tapis,Australian Gippsland, Dubai, and Oman � over the calendar month as reported by theAsian Petroleum Price Index. The average differential between the basket and the spotprice of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for theterm-contract price. The second 50% component is the average of spot prices over themonth in Platt's and Rim. These two components are averaged to reach the final ICP price.

Sellers

In addition to any volumes sold by equity producers, Pertamina sells the crude oil viafour marketing affiliates. For sales to Japan, Indonesia�s largest market, Pacific PetroleumAnd Trading Company is used, a 50-50 joint venture between Pertamina and Japanesebuyers. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco) andsales to China go through Perta.


Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul,Korea 10010. Tel: (822)752-0592. Fax: (822) 752-0596.

Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong.Tel: 5-260-341. Fax: 5-2519-8909.


Conoco International (Singapore): 80 Marine Parade Road 17-01A, ParkwayParade, Singapore 1544. Tel.: (65) 348-0771, Fax: (65) 345-0792.

Loading Port

Belida. Offshore loading facility at the production platform in the South China Sea. Nopractical restrictions on vessel size.


BELIDA ASSAYAssay not available.


CINTA Indonesia

Gravity: 32.8 Sulfur: 0.12 Loading Port: CintaOther Names: Cinta Blend, Intan-Cinta

ProductionOutput of about 50,000-60,000 barrels a day from offshore fields near southeast Sumatra.The Cinta field is adjacent to the more recent Widuri and Intan discoveries. Intan was ini-tially commingled with Cinta due to its similar quality, but it is now exported with Widuri.

QualityA typical medium-gravity Asian crude oil with low-sulfur but high-wax content, similarin quality to Indonesian benchmark Minas. Well-suited for cracking.

ProducersMaxus is the operator (55.68%), with small minority stakes held by Japan�s Inpex(13.07%), Repsol (9.87%), Itochu (7.68%), Deminex (5%), Warrior Oil (3.77%), Oryx(3.71%), and TCR (1.23%). Production split is 85-15 in favor of Pertamina after allowingfor cost-recovery oil going to producers and excluding set volumes that producers mustsell to the domestic market at discounted prices.

Pricing And MarketingThe crude oil has been sold mainly to Japan, which takes about 90% of total exports ofabout 45,000 b/d. Japan uses the crude oil mainly for direct burning in power plants.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first is linked tothe average prices for five spot crude oils � Indonesian Minas, Malaysian Tapis,Australian Gippsland, Dubai, and Oman � over the calendar month as reported by theAsian Petroleum Price Index. The average differential between the basket and the spotprice of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting forthe term-contract price. The second 50% component is the average of spot prices over themonth in Platt's and Rim. These two are averaged to reach the final ICP price.

SellersIn addition to any volumes sold by equity producers, Pertamina sells the crude oil viafour marketing affiliates. For sales to Japan, Indonesia�s largest market, Pacific PetroleumAnd Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, isused. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), andsales to China go through Perta.

Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower,17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: -6504.




Maxus Energy Trading Co.: 1 Scotts Road, #18-03 Shaw Centre, 0922 Singapore.Tel.: (65) 732-9266, Fax: (65) 733-3397.

Loading PortCinta. 05.27 S. 106.14 E. The offshore Cinta terminal, located about 40 miles north of theJava coast and east of the southern tip of Sumatra in the Java Sea, consists of two stor-age vessels and two export single-buoy moorings. The system is designed to accommo-date tankers of up to 175,000 deadweight tons, but due to limited storage, ships of thatsize can only take partial cargoes without waiting for storage to fill up again.


CINTA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.8 Sulfur Content % Weight 0.12Barrels /Metric Ton 7.32 Pour Point Temp. F 100Viscosity Centistokes 17.86 Wax Content % Weight 19.56(Kinematic) at 100 F



Octane RON Clear Octane 72.5Int. Naphtha 100-180 8 Intermediate Naphtha

Paraffins % Wt. 78.3Naphthenes % Wt. 15.5Aromatics % Wt. 8.2

Kerosine 180-250 9.4 KerosineSmoke Point mm 28Freezing Point Temp. F -5

Gas Oil 250-375 19.5 Gas OilCetane Index 74

Residue >375 31 ResidueSulfur Content % Wt. 0.19Pour Point Temp. F 125


CINTA OFFICIAL TERM-CONTRACT PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.15 $13.50 $27.00 $34.50 $34.00 $33.30 $28.25 $28.25 Feb. 13.15 13.50 29.00 34.50 34.00 28.25 28.25 27.25March 13.15 13.50 29.00 34.50 34.00 28.25 28.25 27.25April 13.15 15.20 29.00 34.50 34.00 28.25 28.25 27.25May 13.15 15.70 31.00 34.50 34.00 28.25 28.25 27.25June 13.15 17.75 31.00 34.50 34.00 28.25 28.25 27.25July 13.15 21.01 31.00 34.50 34.00 28.25 28.25 27.25Aug. 13.15 21.01 31.00 34.50 34.00 28.25 28.25 27.25Sept. 13.15 21.01 31.00 34.00 34.00 28.25 28.25 27.25Oct. 13.15 21.01 31.00 34.00 34.00 28.25 28.25 27.25Nov. 13.15 23.50 31.00 34.00 33.30 28.25 28.25 27.25Dec. 13.15 25.40 31.00 34.00 33.30 28.25 28.25 27.25Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $27.25 $16.08 $17.20 $14.64 $18.85 $25.10 $17.88 $17.29 Feb. 27.25 17.10 17.20 17.20 18.90 21.44 17.42 16.91March ... 17.10 17.10 17.20 18.39 17.38 16.87 17.82April ... 17.10 15.64 17.99 17.04 17.04 16.97 18.23May ... 17.10 16.14 18.41 15.85 17.68 17.68 18.03June ... 17.10 16.09 17.82 15.10 17.96 18.97 17.75July ... 17.10 16.09 17.68 14.35 18.21 20.12 16.78Aug. 9.30 17.20 14.44 16.87 18.74 18.65 19.64 16.92Sept. 11.60 17.20 14.44 16.71 27.59 19.11 19.05 16.35Oct. 12.60 17.20 12.84 17.03 34.85 20.08 19.13 16.47Nov. 13.20 17.20 11.74 17.50 33.16 20.64 18.87 15.40Dec. 13.20 17.20 12.14 17.69 28.61 19.91 18.11 13.84Note: More recent prices can be found in Chapter I.


DURI Indonesia

Gravity: 20.3 Sulfur: 0.19 Loading Port: Dumai

ProductionAbout 250,000-300,000 barrels a day is produced from fields in central Sumatra, follow-ing an extensive steam-flooding program. About 20% of the total, or 50,000-60,000 b/d,is used to generate the steam for injection into the reservoirs.

QualityA typical heavy Asian crude oil with an extremely high wax content and a high yield ofhard-to-handle low-sulfur waxy residual oil.

ProducersCaltex Pacific Indonesia, a 50-50 joint venture between Chevron and Texaco, is the oper-ator, with no other partners. State Pertamina receives the majority share of output afterallowing for cost-recovery oil going to the producer and excluding a set volume thatCaltex must sell to the domestic market at a discounted price. Pertamina also sells somevolumes back to Caltex for international marketing.

Pricing And MarketingThe crude oil is sold widely in Asia, mainly on a term-contract basis, with exports ofabout 130,000 b/d. Japan is the main importer, taking about 35,000 b/d, with over halfof that volume for direct burning. South Korea and China are also buyers. Over 70,000b/d is used as feedstock at the Indonesian refineries of Dumai and Balikpapan. Chevronsometimes takes volumes to Singapore and its West Coast refineries, but Texaco rarelyuses the crude oil in its own system.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first is linked tothe average prices for five spot crude oils � Indonesian Minas, Malaysian Tapis,Australian Gippsland, Dubai, and Oman � over the calendar month as reported by theAsian Petroleum Price Index. The average differential between the basket and the spotprice of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting forthe term-contract price. The second 50% component is the average of spot prices over themonth in Platt's and Rim. These two are averaged to reach the final ICP price.

SellersIn addition to any volumes sold by equity producers, Pertamina sells the crude oil viafour marketing affiliates. For sales to Japan, Indonesia�s largest market, Pacific Petroleumand Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, isused. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco) andsales to China go through Perta.

Pacific Petroleum and Trading Company: East Tower 11F, Akasaka Twin Tower,17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3)5562-6504.




Caltex Trading Pte. Ltd.: Caltex House, 30 Raffles Place, 0104 Singapore. Tel.: (65)533-3000.

Loading PortDumai. 01.41 N. 101.27 E. The Dumai terminal, located on the northeast coast of theisland of Sumatra, 150 miles west of Singapore, has four crude oil-loading berths. Sizerestrictions are up to 150,000 deadweight tons and draft of 57 feet.


DURI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 20.3 Sulfur Content % Weight 0.19Barrels /Metric Ton 6.75 Pour Point Temp. F 60Viscosity Centistokes 488.5 Reid Vapor Press. Lbs/Sq. In. 1(Kinematic) at 100 F Wax Content % Weight 13




Aromatics % Wt. 11.7Kerosine 200-300 10.6 Kerosine

Smoke Point mm 13Gas Oil 300-350 22.4 Gas Oil

Cetane Index 41.1Residue >350 79.1 Residue

Sulfur Content % Wt. 0.27Year Of Crude Oil Sample: 1991 Pour Point Temp. F 75

DURI OFFICIAL TERM-CONTRACT PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.55 $13.90 $27.50 $35.00 $35.00 $33.10 $27.85 $25.95 Feb. 13.55 13.90 29.50 35.00 35.00 27.85 27.85 25.95March 13.55 13.90 29.50 35.00 35.00 27.85 27.85 25.95April 13.55 15.65 29.50 35.00 35.00 27.85 25.95 25.95May 13.55 16.15 31.50 35.00 35.00 27.85 25.95 25.95June 13.55 18.25 31.50 35.00 35.00 27.85 25.95 25.95July 13.55 21.12 31.50 35.00 35.00 27.85 25.95 25.95Aug. 13.55 21.12 31.50 35.00 35.00 27.85 25.95 24.00Sept. 13.55 21.12 31.50 35.00 35.00 27.85 25.95 24.00Oct. 13.55 21.12 31.50 35.00 35.00 27.85 25.95 24.00Nov. 13.55 23.50 31.50 35.00 33.10 27.85 25.95 24.00Dec. 13.55 25.50 31.50 35.00 33.10 27.85 25.95 24.00Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $24.00 $14.28 $16.10 $13.54 $17.09 $22.79 $14.90 $15.32 Feb. 24.00 15.60 16.10 16.10 17.86 19.14 14.20 14.96March ... 15.60 16.00 16.10 17.26 15.14 13.72 15.92April ... 15.60 14.54 16.57 15.75 14.61 13.81 16.61May ... 15.60 15.14 16.99 14.37 15.06 14.51 16.70June ... 15.60 14.99 16.39 13.48 15.29 15.78 16.07July ... 15.60 14.99 16.25 12.59 15.38 17.02 14.68Aug. 7.90 16.10 13.34 15.41 16.77 15.57 16.78 14.34Sept. 9.90 16.10 13.34 14.81 25.41 15.71 16.36 13.70Oct. 10.80 16.10 11.74 15.10 32.66 16.26 16.40 13.92Nov. 11.40 16.10 10.64 15.72 30.90 16.97 16.38 12.87Dec. 11.40 16.10 11.04 15.94 26.40 16.58 15.94 11.18Note: More recent prices can be found in Chapter I.


HANDIL Indonesia

Gravity: 32.2 Sulfur: 0.1 Loading Port: SenipahOther Names: Senipah

ProductionAbout 40,000 barrels a day from offshore fields on the east coast of Kalimantan, downfrom a peak of over 140,000 b/d in 1986.

QualityTypical medium-gravity, low-sulfur Asian crude oil similar to Indonesian benchmarkMinas. High wax content produces hard-to-handle, high-pour-point fuel oil. Good forgasoline production through reforming, also has a wide kerosine cut.

ProducersOperator Total (50%) with Japan�s Inpex (50%). The production split is 85-15 in favor ofstate Pertamina after allowing for cost-recovery oil going to producers and excluding setvolumes that producers must sell to the domestic market at discounted prices.

Pricing And MarketingWith Pertamina absorbing a larger share of declining output internally at the nearbyBalikpapan refinery, international spot sales are rare, and most of the overseas sales ofabout 25,000 b/d are committed on a term basis to Japan, where the crude oil is usedboth for refining and direct burning.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first is linked tothe average prices for five spot crude oils � Indonesian Minas, Malaysian Tapis,Australian Gippsland, Dubai, and Oman � over the calendar month as reported by theAsian Petroleum Price Index. The average differential between the basket and the spotprice of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting forthe term-contract price. The second 50% component is the average of spot prices for thecrude oil over the month in Platt's and Rim. These two are averaged to arrive at the finalICP price.

SellersIn addition to any volumes sold by equity producers, Pertamina sells the crude oil viafour marketing affiliates. For sales to Japan, Indonesia�s largest market, Pacific Petroleumand Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, isused. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), andsales to China go through Perta.





Total Petroleum (Southeast Asia) Pte. Ltd.: 331 North Bridge Road, #23-01 OdeonTower, Singapore 0718. Tel.: (65) 336-1333, Fax: (65) 336-7100.

Loading PortSenipah. 01.03 S. 117.13 E. The Senipah Sea Terminal, located about 26 miles (45 kilo-meters) northeast of Balikpapan on the east coast of Kalimantan, consists of two berths.The maximum size vessel is 125,000 deadweight tons. The terminal has storage for631,000 barrels of Bekapai and 1.91-million barrels of Handil.


HANDIL ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.2 Sulfur Content % Weight 0.1Barrels /Metric Ton 7.29 Pour Point Temp. F 85Viscosity Centistokes 4.6 Reid Vapor Press. Lbs/Sq. In. 3.3(Kinematic) at 100 F Wax Content % Weight 22




Paraffins % Wt. 18Naphthenes % Wt. 28.5Aromatics % Wt. 53





HANDIL OFFICIAL TERM-CONTRACT PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.30 $13.95 $27.55 $35.30 $34.00 $34.80 $29.50 $29.50 Feb. 13.30 13.95 29.55 35.30 34.00 29.50 29.50 28.00March 13.30 13.95 29.55 35.30 34.00 29.50 29.50 28.00April 13.30 15.70 29.55 35.30 34.00 29.50 29.50 28.00May 13.30 16.30 31.55 35.30 34.00 29.50 29.50 28.00June 13.30 18.30 31.55 35.30 34.00 29.50 29.50 28.00July 13.30 21.16 31.55 35.30 34.00 29.50 29.50 28.00Aug. 13.30 21.16 31.55 35.30 34.00 29.50 29.50 27.80Sept. 13.30 21.16 31.55 34.00 34.00 29.50 29.50 27.80Oct. 13.30 21.16 31.55 34.00 34.00 29.50 29.50 27.80Nov. 13.30 23.50 31.55 34.00 34.80 29.50 29.50 27.80Dec. 13.30 25.60 31.55 34.00 34.80 29.50 29.50 27.80Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. ... ... $17.61 $15.15 $19.25 $25.38 $18.39 $17.88 Feb. ... $17.61 17.61 17.61 19.29 21.77 17.92 17.48March ... 17.61 17.51 17.61 18.75 17.76 17.39 18.38April ... 17.61 16.05 18.73 17.41 17.42 17.51 18.76May ... 17.61 16.65 18.65 16.24 18.05 18.25 18.54June ... 17.61 16.50 18.09 15.49 18.34 19.56 18.21July ... 17.61 16.50 17.97 14.74 18.61 20.72 17.19Aug. ... 17.61 14.85 17.17 19.10 19.06 20.25 17.31Sept. ... 17.61 14.85 17.05 27.95 19.54 19.68 16.74Oct. ... 17.61 13.25 17.40 35.17 20.53 19.76 16.87Nov. ... 17.61 12.15 17.90 33.43 21.11 19.49 15.82Dec. ... 17.61 12.65 18.09 28.86 20.43 18.72 14.29Note: More recent prices can be found in Chapter I.


LALANG Indonesia

Gravity: 39.2 Sulfur: 0.11 Loading Port: Lalang Marine TerminalOther Names: Lalang Export Blend

ProductionOutput of about 25,000 barrels a day from a cluster of small offshore fields off the eastcoast of central Sumatra under a standard Indonesian production-sharing contract. Themain fields are Lalang, Melibur, Kurau, and Mengkapan. Output peaked at about 60,000b/d in 1989-90.

QualityA typical light, low-sulfur Asian grade with high wax content. Good yields of gasolineand middle distillates are possible.

ProducersLasmo is the operator with a 23.4% share, along with partners Arco (32.58%), Oryx(21.46%), Nippon Oil (17.55%), and Kondur Petroleum (5%). Production split is 85-15 infavor of Pertamina after allowing for cost-recovery oil going to producers and excludingset volumes that producers must sell to the domestic market at discounted prices.

Pricing And MarketingExports have slipped to about 15,000 b/d, with about half going to Japan and about halfto nearby Singapore. The remainder of the grade is absorbed locally.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first is linked tothe average prices for five spot grades � Indonesian Minas, Malaysian Tapis, AustralianGippsland, Dubai, and Oman � over the calendar month as reported by the AsianPetroleum Price Index. The average differential between the basket and the spot price ofArdjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of spot prices over the monthin Platt's and Rim. These two are averaged to reach the final ICP price.

SellersIn addition to any volumes sold by equity producers, Pertamina sells the grade via fourmarketing affiliates. For sales to Japan, Indonesia�s largest market, Pacific Petroleum andTrading Company, a 50-50 joint venture between Pertamina and Japanese buyers, isused. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), andsales to China go through Perta.





Loading PortLalang Marine Terminal. 01.22 S. 102.15.03 E. The terminal is located off the east coastof central Sumatra south of Dumai and about 80 kilometers west of Singapore. It canhandle ships up to 140,000 deadweight tons with a depth of 22.7 meters. Storage capac-ity is 1.012-million barrels.


LALANG ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.2 Sulfur Content % Weight 0.11Barrels /Metric Ton 7.6 Pour Point Temp. F 90Viscosity Centistokes 7.5 Reid Vapor Press. Lbs/Sq. In. 2.5(Kinematic) at 100 F Wax Content % Weight 27.4






Gas Oil 250-350 25 Gas OilCetane Index 72

Residue >350 40 ResidueSulfur Content % Wt. 0.17



MINAS Indonesia

Gravity: 34.1 Sulfur: 0.09 Loading Port: DumaiOther Names: Sumatran Light, Sumatran Light Export Blend, SLC

ProductionAbout 385,000-400,000 barrels a day is produced from the Minas field and others onshorein central Sumatra. Minas is by far the largest crude oil stream in Indonesia.

QualityIndonesia�s benchmark grade is typical of medium-gravity Asian crude oils, which arelow in sulfur but high in wax content and pour point.

ProducersCaltex Pacific Indonesia, a 50-50 joint venture between Chevron and Texaco, is the oper-ator, with no other partners. State Pertamina receives a 90% share of the output afterallowing for cost-recovery oil going to the producer and excluding a set volume thatCaltex must sell to the domestic market at a discounted price. Pertamina�s share wasincreased in 1992, when the contract with Caltex was extended to 2023.

Pricing And MarketingAbout 235,000 b/d of Minas is exported, and Japan is the primary market, taking about195,000 b/d both from Pertamina and Caltex sources in 1995. The grade is often used asboiler fuel by Japanese utilities. Caltex, Chevron, and Texaco also take some of the gradefor their own refining systems. Pertamina has increased its reliance on the grade for localneeds, which has reduced export volumes from over 300,000 b/d in the late 1980s. Minasis one of the most actively traded spot crude oils in the region with about 6-8 wet bar-rel deals a month.

Pricing is based on a complex retroactive formula known as the ICP or IndonesianContract Price. This formula has two components of equal weight. The first component islinked to the average prices for five spot crude oils � Indonesian Minas, Malaysian Tapis,Australian Gippsland, Dubai, and Oman � over the calendar month as reported by theAsian Petroleum Price Index. The average differential between the basket and the spotprice of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for theterm-contract price. The second 50% component is the average of Ardjuna spot prices overthe month in Platt's and Rim. These two are averaged to reach the final ICP price.


Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower,17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: -6504.




Caltex Trading Pte. Ltd.: Caltex House, 30 Raffles Place, 0104 Singapore. Tel.: (65)533-3000.Loading PortDumai. 01.41 N. 101.27 E. The Dumai terminal, located on the northeast coast of theisland of Sumatra, 150 miles west of Singapore, has three crude oil-loading berths. Sizerestrictions are up to 150,000 deadweight tons and draft of 57 feet.


MINAS ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 34.1 Sulfur Content % Weight 0.09Barrels /Metric Ton 7.38 Pour Point Temp. F 95Viscosity Centistokes 13.2 Reid Vapor Press. Lbs/Sq. In. 1.3(Kinematic) at 100 F Wax Content % Weight 34.2









MINAS OFFICIAL TERM-CONTRACT PRICES, 1978-93



WIDURI Indonesia

Gravity: 33.2 Sulfur: 0.07 Loading Port: WiduriOther Names: Widuri Blend

ProductionOutput of about 75,000 barrels a day in 1995 included volumes from both the Widuriand Intan fields, which lie offshore between the northwest coast of Java and the south-east tip of Sumatra. This is down from peak levels of about 100,000 b/d.

QualityA typical medium-gravity Indonesian crude oil somewhat inferior to Minas. It is espe-cially good for cracking, but Widuri initially faced problems establishing market outletsdue to its high wax content.

ProducersMaxus is the operator (55.68%), with small minority stakes held by Inpex (13.07%),Repsol (9.87%), Itochu (7.68%), Deminex (5%), Warrior Oil (3.77%), Oryx (3.71%), andTCR (1.23%). Production split is 85-15 in favor of Pertamina after allowing for cost-recov-ery oil going to producers and excluding set volumes that producers must sell to thedomestic market at discounted prices.

Pricing And MarketingVirtually all production is exported, making Widuri one of Indonesia�s larger exportstreams after Minas, Duri, Arun, and Belida. Japanese buyers take about half of theexports. China is also a buyer along with Australia.

Pricing is based on a complex retroactive formula known as the ICP, or IndonesianContract Price. This formula has two components of equal weight. The first is linked to theaverage prices for five spot crude oils � Indonesian Minas, Malaysian Tapis, AustralianGippsland, Dubai, and Oman � over the calendar month as reported by the AsianPetroleum Price Index. The average differential between the basket and the spot price ofArdjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of Ardjuna spot prices over themonth in Platt's and Rim. These two are averaged to reach the final ICP price.


Pacific Petroleum and Trading Company: East Tower 11F, Akasaka Twin Tower,17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: -6504.




Maxus Energy Trading Co.: 1 Scotts Road, #18-03 Shaw Centre, 0922 Singapore.Tel.: (65) 732-9266, Fax: (65) 733-3397.

Loading PortWiduri. 4.40.16 S. 106.39.50 E. The offshore terminal has two single-buoy moorings thatcan each take ships up to 175,000 deadweight tons. They are served by a 1.9-million-barrel storage vessel.


WIDURI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 33.2 Sulfur Content % Weight 0.07Barrels /Metric Ton 7.338 Pour Point Temp. C/F 45/113Viscosity Centistokes 8.98 Reid Vapor Press. Lbs/Sq. In. <0.5(Kinematic) at 60 C Wax Content % Weight 39.3



<149 Octane RON Clear Octane 61.2Paraffins % Wt. 82.8Naphthenes % Wt. 17Aromatics % Wt. 0.2

Int. Naphtha 65-100 0.88 0.74 Intermediate Naphtha149-212 Octane RON Clear Octane 53.8


Heavy Naphtha 100-150 3.21 2.77 Heavy Naphtha212-302 Paraffins % Wt. 59

Naphthenes % Wt. 38.7Aromatics % Wt. 2.3

Kerosine 150-250 8.83 8.06 Kerosine302-482 Freezing Point Temp. C -39.5



Heavy Gas Oil 300-370 12.51 12.06 Heavy Gas Oil572-698 Cloud Point Temp. C 13


Pour Point Temp. C 51Viscosity (Kin) Cen at 80 C 29.37Asphaltenes % Wt. <0.5Conradson Carbon R % Wt. 4.12Vanadium Parts/mill. 3



FOROOZAN BLEND Iran

Gravity: 30.7 Sulfur: 2.5 Loading Port: Kharg IslandOther Names: Forouzan, Fereidoon, Darius, Cyrus

Production

Combined flows of about 275,000 barrels a day from the offshore Foroozan, Dorood,Abuzar, and Soroosh fields, which were severely damaged in the war with Iraq but havenow been restored with further increases in capacity to over 500,000 b/d by 2000.

Quality

Similar to Iranian Heavy, but somewhat higher in sulfur. The assay below reflects thecombined fields at their restored volume, but quality may change with rising output.

Producers

State National Iranian Oil Co. is the exclusive producer.


Cargoes are mainly exported on an f.o.b. basis from the nearby Kharg Island terminal tocustomers in the Asia-Pacific region, mainly on a term-contract basis. Japan imports over50,000 b/d. Prices are set according to a formula similar to Iran Heavy. Spot sales are rare.

Sellers

NIOC is the exclusive seller. The firm has offices around the world, including a tradingsubsidiary in London called Nafta-Iran.

NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran,Iran. Phone: (98-21) 646-0351. Fax: (98-21) 646-0302.

NIOC and Nafta-Iran Intertrade: NIOC House, 4 Victoria St., London SW1H 0NE,UK. Tel.: (44-171) 227-2138, Fax: (44-171) 976-8315.

NIOC Toronto: 4950 Young St., Suite 808, North York, Toronto, Ontario, CanadaM2N 6K1. Tel.: (416) 459-9426, Fax: (416) 590-9836.

NIOC Singapore: 70 Shenton Way, 17-03 Marina House, 0207 Singapore. Tel.: (65)227-3722, Fax: (65) 227-3622.

Loading Port

Kharg Island. 29.14 N. 50.19 E. Located at the northeast end of the Mideast Gulf,Kharg Island has a main terminal and the four-berth Sea Island on the west side ofKharg. The terminal�s T-jetty has a total of 10 crude oil-loading berths. Only about halfthe berths are in use, with the others requiring further reconstruction. Damage toonshore storage during the war with Iraq requires the use of storage tankers to main-tain smooth loading operations.


FOROOZAN BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 30.7 Sulfur Content % Weight 2.5Barrels /Metric Ton 7.2 Pour Point Temp. C -35Viscosity Centistokes 8.61 Reid Vapor Press. psi 5.7(Kinematic) at 40 C Nickel ppm 13Hydrogen Sulfide ppm 6 Vanadium ppm 48Con. Carbon Residue % Weight 6.16 Iron ppm 10Wax Content % Weight 7.18 Lead ppm 2.7

Sodium ppm 14Year Of Crude Oil Sample: 1993


IRAN HEAVY Iran

Gravity: 30.2 Sulfur: 1.77 Loading Port: Kharg IslandOther Names: Gachsaran

ProductionIn 1995-96, Iran Heavy production was about 1.5-million barrels a day, with exports ofaround 1.1-million b/d. Iran Heavy flows are slightly larger than those of Iran Light, mak-ing it the country�s largest crude oil stream. Among the biggest fields in the Iran Heavystream are Gachsaran and Bibi Hakimeh, which are heavily dependent on gas injectionprograms to maintain output levels.

QualityA typical medium-heavy, high-sulfur Mideast crude oil similar in quality to Arab Mediumor Kuwait. Iran Heavy has become slightly heavier and higher in sulfur over the last 10years.

Producers


Pricing And MarketingCargoes are sold from the Kharg Island terminal into Northwest Europe, theMediterranean, and the Far East. Volumes are usually acquired on a term or spot basisfrom NIOC. Traders sometimes resell the grade into the Mediterranean spot market, butthis practice has decreased with NIOC�s greater focus on sales to refiners, which was rein-forced by the US ban on purchases by American companies in 1995. The traditional dis-tinctions between spot and term sales are particularly blurred in the case of Iran�s mainexport grades. The country maintains a stable of some 40 regular buyers, although somebuy only monthly spot cargoes, while others hold contracts of up to a year in length.

Prices to Europe are set on a cargo-by-cargo basis according to a formula that is seton a variable differential to dated Brent quotes. Supplies can be purchased both on anf.o.b. basis from Kharg Island and on a delivered basis from Rotterdam storage. To theFar East, Iran Heavy is sold at a variable differential to spot Dubai with a special adjust-ment in the formula to compensate for swings in the Oman-Dubai price spread.

SellersNIOC is the exclusive seller of f.o.b. cargoes from Kharg Island, and has offices aroundthe world.

NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran,Iran. Phone: (98-21) 646-0351. Fax: (98-21) 646-0302.




Loading PortsKharg Island. 29.14 N. 50.19 E. Located at the northeast end of the Mideast Gulf, KhargIsland has a main terminal and the four-berth Sea Island on the west side of Kharg. Theterminal�s T-jetty has a total of 10 crude oil-loading berths. Only about half the berths arein use, with the others requiring further reconstruction. Damage to onshore storage duringthe war with Iraq requires the use of storage tankers to maintain smooth loading opera-


IRAN HEAVY ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 30.2 Sulfur Content % Weight 1.77Barrels /Metric Ton 7.2 Pour Point Temp. C -19Viscosity Centistokes 9.26 Reid Vapor Press. psi 6.7(Kinematic) at 40 C Nickel ppm 28Hydrogen Sulfide ppm 59 Vanadium ppm 100Con. Carbon Residue % Weight 6.17 Iron ppm 9.1Wax Content % Weight 10.7 Lead ppm 2.5

Sodium ppm 7.9Year Of Crude Oil Sample: 1993

IRAN HEAVY TERM-CONTRACT PRICES, 1988-93

At Port Of Loading In Dollars Per BarrelMonth 1988 1989 1990 1991 1992 1993Jan. $15.20 $13.90 $17.29 $18.16 $14.49 $14.26Feb. 14.84 14.05 16.53 13.32 14.34 14.98March 13.18 15.40 15.61 13.82 15.14 15.21April 14.67 16.75 13.84 14.72 16.14 15.19May 14.63 15.50 14.13 14.48 17.42 14.91June 13.53 15.25 12.78 14.26 17.70 14.26July 12.78 15.35 14.23 15.67 17.26 13.31Aug. 12.88 14.85 23.91 16.73 17.00 13.47Sept. 11.28 15.45 30.86 17.77 17.43 12.99Oct. 9.65 16.00 31.73 16.94 16.93 13.63Nov. 9.95 16.00 28.19 15.81 15.89 12.56Dec. 11.85 16.95 23.46 14.73 15.10 11.22

Note: 1/88-3/91 prices are for f.o.b. sales to Far East destinations. Prices for 4/91-12/93 represent a weighted average of f.o.b.prices for sales to the Far East and Europe.

IRAN HEAVY SPOT PRICES, 1987-93

At Port Of Loading In Dollars Per BarrelMonth 1987 1988 1989 1990 1991 1992 1993Jan. $17.15 $15.30 $13.90 $17.35 $19.35 $14.75 $14.70Feb. 16.70 14.95 14.05 16.60 14.35 15.35 15.60March 16.80 13.00 15.55 15.65 14.80 15.35 15.85April 16.70 14.70 17.40 13.85 15.15 16.15 15.85May 17.05 14.50 16.25 13.60 16.00 17.10 15.70June 17.10 13.40 15.55 12.05 15.25 18.50 14.70July 17.40 13.10 15.65 14.10 15.75 17.95 14.00Aug. 17.10 12.75 15.10 23.45 16.10 17.45 14.00Sept. 17.05 11.35 15.90 29.40 17.35 18.05 13.70Oct. 17.05 9.85 16.00 31.30 18.45 18.25 14.40Nov. 15.80 10.10 15.95 27.70 18.10 17.25 13.05Dec. 15.30 12.10 16.90 22.95 14.80 15.80 11.95Note: More recent prices can be found in Chapter I.


IRAN LIGHT Iran

Gravity: 33.1 Sulfur: 1.5 Loading Port: Kharg IslandOther Names: Agha Jari

ProductionIn 1995-96, output was about 1.3-million barrels a day, with exports of about 1-millionb/d from several onshore fields including Agha Jari, Marun, Karanj, and Pazanan. TheAgha Jari field supplies about 270,000 b/d. Both the Karanj and Parsi fields have bene-fited from extensive investment in gas injection in the early 1990s to maintain flow rates.

QualitySimilar to Arabian Light, Dubai, and other light Mideast grades, it has become a bit heav-ier and higher in sulfur in recent years as indicated by the earlier assay from 1982.

Producers


Pricing And MarketingCargoes are sold from the Kharg Island terminal into Northwest Europe, theMediterranean, and the Far East. Volumes are usually acquired on a term or spot basisfrom NIOC. Traders sometimes resell the grade into the Mediterranean spot market, butthis practice has decreased with NIOC�s greater focus on sales to refiners, which wasreinforced by the US ban on purchases by US companies in 1995. The traditional dis-tinctions between spot and term sales are particularly blurred in the case of Iran�s mainexport grades. The country maintains a stable of some 40 regular buyers, although somebuy only monthly spot cargoes, while others hold contracts of up to a year in length.

Prices to Europe are set on a cargo-by-cargo basis according to a formula that is seton a variable differential to dated Brent quotes. Supplies can be purchased both on anf.o.b. basis from Kharg Island and on a delivered basis from Rotterdam storage. To theFar East, Iran Heavy is sold at a variable differential to spot Dubai with a special adjust-ment in the formula to compensate for swings in the Oman-Dubai price spread.

SellersNIOC is the exclusive seller of f.o.b. cargoes from Kharg Island. Since Iran Light regu-larly appears in the spot market, traders compete with NIOC in Europe and the Far Eastfor customers. NIOC has offices around the world.

NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran,Iran. Phone: (98-21) 646-0351. Fax: 98-21) 646-0302.




Loading PortKharg Island. 29.14 N. 50.19 E. Located at the northeast end of the Mideast Gulf, KhargIsland has a main terminal and the four-berth Sea Island on the west side of Kharg. Theterminal�s T-jetty has a total of 10 crude oil-loading berths. Only about half the berths arein use, with the others requiring further reconstruction. Damage to onshore storage duringthe war with Iraq requires the use of storage tankers to maintain smooth loading opera-tions.


IRAN LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 33.1 Sulfur Content % Weight 1.5Barrels /Metric Ton 7.33 Pour Point Temp. C -19Viscosity Centistokes 6.33 Reid Vapor Press. psi 8.1(Kinematic) at 40 C Nickel ppm 16Hydrogen Sulfide ppm 50 Vanadium ppm 58Con. Carbon Residue % Weight 4.89 Iron ppm 12Wax Content % Weight 6.85 Lead ppm 2.3Year Of Crude Oil Sample: 1993 Sodium ppm 6.9

IRAN LIGHT AVERAGE TERM-CONTRACT PRICES, 1978-93

Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $12.64 $13.45 $30.37 $37.00 $34.20 $31.20 $28.00 $29.11Feb. 12.64 13.45 32.87 37.00 30.20 31.20 28.00 28.05March 12.64 14.27 32.87 37.00 30.20 28.00 28.00 28.05April 12.64 16.57 35.37 37.00 30.20 28.00 28.00 28.05May 12.64 17.09 29.93 37.00 30.20 28.00 28.00 28.05June 12.64 18.47 29.93 37.00 30.20 28.00 28.00 28.05July 12.64 22.00 31.93 36.00 31.20 28.00 28.00 28.05Aug. 12.64 22.21 31.93 36.00 31.20 28.00 28.00 28.05Sept. 12.64 22.21 31.93 36.00 31.20 28.00 28.00 28.05Oct. 12.64 23.71 31.93 36.00 31.20 28.00 28.00 26.20Nov 12.64 25.93 31.93 34.60 31.20 28.00 28.00 27.10Dec. 12.64 28.71 31.93 34.60 31.20 28.00 28.00 26.40Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $26.65 $17.90 $14.27 $15.35 $17.01 $17.85 $15.85 $15.37Feb. 14.80 17.50 14.45 16.84 15.64 15.59 15.52 16.24March 12.20 17.50 14.35 17.36 14.18 16.81 16.54 16.33April 11.10 17.50 14.49 17.15 13.05 16.09 17.45 16.21May 11.95 17.50 14.03 15.76 13.44 15.93 18.83 15.94June 10.95 17.50 13.38 15.38 17.47 16.28 18.78 15.25July 8.40 17.50 12.51 15.66 24.32 17.33 18.33 14.39Aug. 12.70 17.50 11.66 16.23 32.97 18.37 18.26 14.62Sept. 13.70 17.50 10.92 16.67 31.60 19.35 18.64 14.05Oct. 13.85 17.50 11.02 16.98 29.65 17.96 17.84 14.64Nov. 14.30 17.50 12.57 18.03 26.08 16.70 16.77 13.53Dec. 15.55 17.50 14.25 18.17 21.39 16.18 15.62 12.30Note: Official government selling prices through 1/86, netback formulas from 2/86-2/87, official government sellingprice from 2/87-12/87, average spot crude-linked formula price for 1988-93. Note: More recent prices can be foundin Chapter I.


LAVAN BLEND Iran

Gravity: 34.3 Sulfur: 1.87 Loading Port: Lavan IslandOther Names: Sassan, Salman, Rostam

Production

About 140,000 barrels a day comes from three offshore fields in the southeastern part ofthe Mideast Gulf to make up the blend. Most output is from the Salman field, the mainplatform of which was destroyed by US forces during the Iraq-Iran war and was rebuiltin the early 1990s. Other fields are Reshadat and Resalat. With the addition of the Balalfield volumes should rise to over 200,000 b/d.

Quality

Similar in quality to Iran Light.

Producers



Cargoes are sold on an f.o.b. basis from Lavan Island, with almost all production enter-ing the export market and going mainly to customers in the Asia-Pacific region on a term-contract basis. State Indian Oil Corp. and Japanese companies are the main customers.Extra volumes have sometimes been fed into the Iran Light export stream. Prices are setaccording to a formula similar to that for Iran Light. Spot sales are rare.

Sellers






Loading Port

Lavan Island. 26.47 N. 53.20 E. Located on the southeast coastline of Iran, Lavan Island,which is 13 miles long and about 2.5 miles wide, has two crude oil-loading berths andstorage capacity for 5.5-million barrels. Ships of up to 200,000 deadweight tons can beaccommodated.


LAVAN BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 34.3 Sulfur Content % Weight 1.87Barrels /Metric Ton 7.38 Pour Point Temp. C -25Viscosity Centistokes 4.98 Reid Vapor Press. psi 10(Kinematic) at 40 C Nickel ppm 6.6Hydrogen Sulfide ppm ... Vanadium ppm 14Con. Carbon Residue % Weight 4.6 Iron ppm 4.7Wax Content % Weight 6.95 Lead ppm 1.9

Sodium ppm 2Year Of Crude Oil Sample: 1993


SIRRI Iran

Gravity: 30.3 Sulfur: 2.26 Loading Port: Sirri IslandOther Names: Sirri Heavy

Production

About 30,000 barrels a day from an offshore field in the southeastern Mideast Gulf adja-cent to Sirri Island. Output could rise to 200,000 b/d in the future, since there is scopefor significant further development work in the field.

Quality

Slightly heavier and higher in sulfur than Iran Heavy.

Producer



Cargoes are sold on an f.o.b. basis from Sirri Island, with almost all production enteringthe export market and going mainly to the Asia-Pacific region on a term-contract basis.Japan alone takes over 20,000 b/d. Prices are set according to a formula similar to thatfor Iran Heavy.

Sellers






Loading Port

Sirri Island. 25.54 N. 54.33 E. The loading terminal is on the southeast part of the islandof Sirri, with crude oil loaded from a one-berth jetty approximately 600 feet offshore thatcan handle ships up to 330,000 deadweight tons.


SIRRI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 30.29 Sulfur Content % Weight 2.26Barrels /Metric Ton 7.2 Pour Point Temp. C -15Viscosity Centistokes 7.36 Reid Vapor Press. psi 8.9(Kinematic) at 40 C Nickel ppm 15Con. Carbon Residue % Weight 4.9 Vanadium ppm 45Wax Content % Weight 5.5 Iron ppm 1.6

Sodium ppm 9.4


Cut Points YieldProduct Temp. C % Vol. % Wt.LPG 0.95Naphtha <150 14.8 12.3Kerosine 150-250 17.5 16.1Gas Oil 250-350 18.9 18.8Residue >350 44.2 49.7Year Of Crude Oil Sample: 1988


BASRAH LIGHT Iraq

Gravity: 34.4 Sulfur: 2.1 Loading Ports: Mina Al-Bakr, Ceyhan (Turkey)

Production

Limited by the United Nations embargo that was placed on Iraq following its invasion ofKuwait in 1990. Output was about 300,000 barrels a day, which is less than 50% of capac-ity until December 1996. Before the embargo, production was over 1.5-million b/d fromseveral fields in the south, including the Rumaila fields, Zubair, and Luhais.

Quality

Typical light Mideast crude oil similar to Arabian Light, Iran Light, and Dubai. Althoughthe test below is old, it remains broadly representative of Basrah Light.

Producer

State-owned Southern Oil Co. is the sole producer.


Prior to the United Nations-sponsored humanitarian oil sales program in 1996, Basrah pro-vides the country�s only UN-approved exports, with about 50,000 b/d sold to Jordan at dis-counted prices and delivered over land by tanker truck. Most of the UN-sponsored salesare of Kirkuk grade, with Basrah Light accounting for a smaller share of sales from theMideast Gulf. Before the invasion of Kuwait, Basrah Light was the only Iraqi crude oil thatwas widely sold to all of the main world markets: the Far East, Europe, and the Americas.

The grade can be loaded from Iraq�s southern Mina al-Bakr terminal in the Gulf, orit can be piped north via the Strategic Pipeline and the Turkish export line for loadingfrom Ceyhan, Turkey.

Seller

State Oil Marketing Organization has been responsible for all international oil sales in thepast.

SOMO Jordan: Amman, Jordan. Fax: (9626) 694-007.Iraqi Oil Ministry, SOMO: Baghdad, Iraq. Fax: (9641) 885-3014.

Loading Ports

Mina al-Bakr. 29.41 N. 48.48 E. Located in the northwest end of the Mideast Gulf, south-southeast of the Shatt-al-Arab waterway and south of the Fao Peninsula, the terminal hasbeen destroyed twice, once in the Iraq-Iran war, and during the bombings that preced-ed the invasion of Iraq by UN forces in 1991. It has estimated capacity of 300,000-500,000b/d from three operational berths, but with little storage capacity.Ceyhan/Botas. 36.53 N. 35.56 E. The Ceyhan/Botas terminal, located on the TurkishMediterranean coast, about 40 miles from the border with Syria, has four crude oil-load-ing berths. Maximum size is 300,000 deadweight tons at the two outer berths and 150,000dwt at the two inner berths.


BASRAH LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 34.4 Sulfur Content % Weight 2.1Barrels /Metric Ton 7.383 Pour Point Temp. C <-30Viscosity Centistokes 12.5 Reid Vapor Press. Lbs/Sq. In. 6.9(Kinematic) at 10 C











Viscosity (Kin) Cen at 60 C 129Asphaltenes % Wt. 1.74Vanadium Parts/mill. 43



FAO BLEND Iraq

Gravity: 27.5 Sulfur: 2.9 Loading Port: Mina Al-BakrOther Names: Basrah Medium, Basrah Heavy (prior to 1981)

Production

The heavier crude oil produced from the southern Iraqi fields, including Buzurgan andAbu Ghirab near the Iranian border. Output was about 500,000 barrels a day before theUnited Nations embargo in the summer of 1990. Little if any of this grade is currently inproduction due to the UN restrictions on exports.

Quality

Introduced after the end of the Iraq-Iran war in late 1989 as an Arabian Heavy equiva-lent, the grade is essentially a combination of former 23-gravity Basrah Heavy and 30-gravity Basrah Medium plus some other production. Although termed a 27.5-gravitycrude oil, quality varied considerably, creating serious marketing problems. The testbelow is at the light end of the quality range.

Producers

State-owned Southern Oil Co.


No current sales due to the UN embargo against Iraq. Sold mainly to the US and the FarEast in late 1989 and early 1990 at a rate of 500,000 b/d with plans to go higher beforethe invasion of Kuwait. Priced on a formula basis with linkage to spot markets for region-al benchmark grades.

Seller

State Oil Marketing Organization has handled all international oil sales in the past.SOMO Jordan: Amman, Jordan. Fax: (9626) 694-007.Iraqi Oil Ministry, SOMO: Baghdad, Iraq. Fax: (9641) 885-3014.

Loading Port

Mina al-Bakr. 29.41 N. 48.48 E. Located in the northwest end of the Mideast Gulf, south-southeast of the Shatt-al-Arab waterway and south of the Fao Peninsula, the terminal hasbeen destroyed twice, once in the Iraq-Iran war, and once during the bombings that pre-ceded the invasion of Iraq by UN forces in 1991. It has estimated capacity of 300,000-500,000 b/d from three operational berths, but with little storage capacity.


FAO BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 29.4 Sulfur Content % Weight 2.94Barrels /Metric Ton 7.17 Pour Point Temp. F -80Viscosity Centistokes 10.5(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG <55 2Light Naphtha 55-175 6.2 Light Naphtha





Gas Oil 500-650 13.4 Gas OilSulfur Content % Wt. 1.79Cetane Index 50

Residue >650 49.3 ResidueSulfur Content % Wt. 4.83Pour Point Temp F 49

Year Of Crude Oil Sample: 1989 Viscosity (Kin) Cen at 100 C 6.86


KIRKUK Iraq

Gravity: 37.0 Sulfur: 2.00 Loading Port: Ceyhan (Turkey)

Production

Kirkuk is the country�s single-largest and oldest producing complex, with capacity of1.3-million barrels a day prior to Iraq�s invasion of Kuwait in 1990. Output was about250,000 b/d from Kirkuk itself and its satellite fields, and has risen to about 600,000-700,000 b/d with the UN-sponsored humanitarian oil sales program in late 1996.Capacity is some 800,000 b/d. Other fields in the Kirkuk export stream include AinZalah, Jambur, and Butma.

Quality

Lighter than Arabian Light and Iran Light, but not as high in quality as top Mideast gradessuch as Abu Dhabi Murban. Although the test below dates from the early 1970s and isslightly heavier than some later assays, it is still broadly representative of Kirkuk�s char-acteristics. Quality may have been harmed by the injection of surplus fuel oil into Iraqifields during the embargo period.

Transportation

When exported, the crude oil is transported by the 1.6-million b/d capacity Turkishexport pipeline, which runs 1,050 kilometers from Kirkuk to the Mediterranean port ofCeyhan.

Producers

All production under the control of state Northern Oil Co.


Prior to the Gulf war, Kirkuk was a mainstay of the sour crude oil market in the AtlanticBasin, with its Mediterranean outlet putting it on an equal footing with Russian exports.Key customers at that time included Brazil�s state Petrobras, Exxon, Texaco, Coastal, andTupras of Turkey, and prices were tied to benchmark spot grades. Under the UN-spon-sored humanitarian oil sales program, contracts have been reestablished with many ofthese same firms as well as new ones such as Russian traders and producers.

Sellers

State Oil Marketing Organization has been the exclusive marketer of Iraqi crude oil inthe past.

SOMO Jordan: Amman, Jordan. Fax: (9626) 694-007.Iraqi Oil Ministry, SOMO: Baghdad, Iraq. Fax: (9641) 885-3014.

Loading Port

Ceyhan/Botas, Turkey. 36.53 N. 35.56 E. The Ceyhan/Botas terminal, located on theTurkish Mediterranean coast about 40 miles from the border with Syria, has four crudeoil-loading berths. Maximum size is 300,000 deadweight tons at the two outer berths and150,000 dwt at the two inner berths.


KIRKUK ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.8 Sulfur Content % Weight 2.06Barrels /Metric Ton 7.444 Pour Point Temp. C -36Viscosity Centistokes 4.61 Reid Vapor Press. Lbs/Sq. In. 5.5(Kinematic) at 100 F Hydrogen Sulfide Parts/mill. <1











Pour Point Temp. C/F 30/86Viscosity (Kin) Cen at 60 C 179Asphaltenes % Wt. 3.33Conradson Carbon R % Wt. 9.24Vanadium Parts/mill. 54


KIRKUK TERM-CONTRACT PRICES, 1978-90Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.50 $13.83 $29.29 $37.50 $34.21 $34.83 $29.43 $29.43Feb. 13.50 13.83 29.29 37.50 34.21 34.83 29.43 28.18March 13.50 15.03 29.29 37.50 34.83 29.83 29.43 28.18April 13.50 16.28 29.29 37.50 34.83 29.43 29.43 28.18May 13.50 16.98 31.29 37.50 34.83 29.43 29.43 28.18June 13.50 20.39 31.29 36.93 34.83 29.43 29.43 28.18July 13.17 22.29 33.29 36.93 34.83 29.43 29.43 28.18Aug. 13.17 22.00 33.29 36.93 34.83 29.43 29.43 28.18Sept. 13.17 22.00 33.29 36.93 34.83 29.43 29.43 28.18Oct. 13.17 23.29 33.29 34.93 34.83 29.43 29.43 28.18Nov. 13.17 25.29 33.29 34.93 34.83 29.43 29.43 28.18Dec. 13.17 27.29 33.29 34.93 34.83 29.43 29.43 28.18Month 1986 1987 1988 1989 1990Jan. $28.18 $17.55 $15.40 $15.72 $19.10Feb. 28.18 17.60 14.36 16.73 17.58March 10.50 17.60 14.78 18.39 15.82April 10.90 17.60 15.48 18.39 14.35May 12.20 17.60 14.83 17.05 14.33June 10.35 17.60 14.08 16.05 12.69July 8.20 17.60 13.75 15.65 15.78Aug. 11.65 17.60 12.93 16.20 23.98Sept. 13.00 17.60 11.68 17.20 ...Oct. 12.35 17.60 11.48 17.65 ...Nov. 12.80 17.60 12.78 18.15 ...Dec. 14.80 17.60 14.84 19.89 ...Note: Official government selling prices until 2/86, netbacks from 3/86-2/87, official prices for remainder of 1987, and averageformula prices thereafter. Note: More recent prices can be found in Chapter I.


KUWAIT Kuwait

Gravity: 30.5 Sulfur: 2.55 Loading Port: Mina Al Ahmadi

Production

Output has been stable at about 1.8-million barrels a day since 1993, following recoveryfrom the Iraqi invasion in 1990. Capacity is about 2.2-million b/d and slated to rise toabout 3-million b/d by 2000. The Burgan field is the largest producing area, with capac-ity of about 1.5-million b/d followed by Ahmadi and Magwa. Kuwait�s only other crudeoil streams are those from the Neutral Zone and some 100,000 b/d of lighter Marat gradethat is produced from areas lying below the main Burgan field. Marat is not marketedseparately.

Quality

A typical medium-heavy Mideast crude oil similar to Arabian Medium and Iran Heavy.

Producers

All production is controlled by state-owned Kuwait Petroleum Corp. through its KuwaitOil Co. unit.


Some 1-million b/d of Kuwait crude oil was being exported in early 1996, with the bal-ance consumed in the country�s 830,000 b/d of domestic refinery capacity. With theexpansion of domestic refining, less crude oil has been available for export in recentyears. Refined product exports amount to about 700,000 b/d and are expected to risefurther with additional refinery expansion. KPC�s crude oil exports include about 50,000b/d to its European refineries and a similar volume in processing deals in Asia. Kuwaithas focused on all of the main international markets in rebuilding its crude oil exportvolumes, but the Far East is the dominant market with about 50% of the total. Japanalone takes 220,000 b/d.

Kuwait prices its crude oil at the prevailing Arabian Medium formulas in the US andEurope and 10¢ below Arab Medium in Asia. KPC sells its crude oil on a term-contractbasis, rarely resorting to spot sales.

Sellers

Kuwait Petroleum Corp.: P.O. Box 26565, Safat, Kuwait, 13126. Tel.: (965) 245-5455, Fax: (965) 246-7159.

KPC London: 80 New Bond St., London W1Y 9DA, UK. Tel.: (44-171) 491-4000, Fax:(44-171) 629-2617.

Loading Port

Mina Al Ahmadi. 29.04 N. 48.09 E. Located on the western shore of the Gulf, the portof Mina Al Ahmadi is Kuwait�s main crude oil-export point, and it has been reconstruct-ed following the war with Iraq. The berths at the old Sea Island Terminal are no longeroperable and have been replaced by a single-buoy mooring system. Very large crude car-rier-sized ships can also be accommodated at the North Pier Terminal and the South PierTerminal. Mina Al Ahmadi has 18-million barrels of crude oil storage capacity.


KUWAIT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 30.5 Sulfur Content % Weight 2.55Barrels /Metric Ton 7.208 Pour Point Temp. C -12Viscosity Centistokes 29.56 Reid Vapor Press. Lbs/Sq. In. 6.2(Kinematic) at 10 C Hydrogen Sulfide Parts/mill. <3













KUWAIT TERM-CONTRACT PRICES, 1978-93At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $12.27 $12.83 $27.50 $35.50 $32.30 $32.30 $27.30 $27.55Feb 12.27 14.03 27.50 35.50 32.30 28.30 27.30 27.30March 12.27 15.32 27.50 35.50 32.30 27.30 27.30 27.30April 12.27 15.80 27.50 35.50 32.30 27.30 27.30 27.30May 12.27 16.40 29.50 35.50 32.30 27.30 27.30 27.30June 12.27 19.00 29.50 35.50 32.30 27.30 27.30 27.30July 12.27 19.49 31.50 35.50 32.30 27.30 27.30 27.30Aug. 12.27 19.49 31.50 35.50 32.30 27.30 27.30 27.30Sept. 12.27 19.49 31.50 35.50 32.30 27.30 27.30 27.30Oct. 12.27 23.50 31.50 35.50 32.30 27.30 27.30 27.30Nov. 12.27 25.50 31.50 33.00 32.30 27.30 27.30 27.30Dec. 12.27 27.50 31.50 33.00 32.30 27.30 27.30 27.30Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $25.75 $17.00 ... $13.78 $17.14 ... $14.22 $14.24Feb. 14.40 16.67 ... 13.98 16.43 ... 14.68 15.02March 11.35 16.67 13.24 15.38 15.50 ... 14.73 15.28April 10.20 16.67 14.75 16.83 13.75 ... 15.75 15.38May 11.05 16.67 14.58 15.53 14.15 ... 16.75 15.04June 9.65 16.67 13.43 15.20 12.71 ... 18.12 14.67July 7.40 16.67 12.65 15.23 14.15 ... 17.57 13.42Aug. 11.75 16.67 12.78 14.70 23.89 ... 16.84 13.68Sept. 12.50 16.67 11.18 15.33 ... ... 17.40 13.13Oct. 12.65 16.67 9.43 15.88 ... 17.66 17.36 13.83Nov. 13.10 16.67 9.75 15.83 ... 17.12 16.28 12.84Dec. 14.50 16.67 11.73 16.90 ... 13.90 15.28 11.22Note: Official selling prices up to 1986 and from 2/87-12/87. Netback prices in 1986 and 1/87. Prices based only on Far Eastsales formulas from 1988-93. Note: More recent prices can be found in Chapter I.


AMNA Libya

Gravity: 36.1 Sulfur: 0.15 Loading Port: Ras LanufOther Names: Amal

Production

About 115,000 barrels a day, mainly from the Amal field, one of the first discoveries inLibya, found in 1959. In decline since the late 1960s.

Quality

A light, paraffinic crude oil that is a bit heavier and higher in wax than the top-qualityLibyan grades.

Equity Producers

State National Oil Co. 51%, Veba 49%.


Priced according to a formula that is linked to spot quotes for dated Brent like all theother main Libyan export grades. No sales to the US due to embargo against Libyan oilthat began in 1986. This confines sales almost exclusively to Europe, where Libya hasdeveloped an extensive refining and marketing network to guarantee offtake. Amna isone of the waxier Libyan grades, which also restricts sales outlets. Most supplies aretaken by Veba as part of its equity supply. Other volumes move to Spain�s Repsol,Austria�s OMV, and German Rheinoel.

Sellers

National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655,Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729.

Veba Oel A.G.: P.O. Box 20 10 45 W-4650, Gelsenkirchen 2, Germany. Tel.: (49-209)3661, Fax: (49-209) 366-7820.

Loading Port

Ras Lanuf. 30.31 N. 18.35 E. Two terminals located on the southeastern side of the Gulfof Sirte about 12 miles (20 kilometers) south of Es Sider. The former Mobil terminal hasthree conventional berths designed for tankers of up to 60 feet draft and 130,000 dead-weight tons, and one single-point mooring intended for vessels of up to 75 ft of draftand 265,000 dwt. The second terminal has two crude oil-loading berths, with maximumsizes of 50,000 dwt and 41 ft draft.


AMNA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.1 Sulfur Content % Weight 0.15Barrels /Metric Ton 7.462 Pour Point Temp. C 24Viscosity Centistokes 13.7 Reid Vapor Press. Lbs/Sq. In. 3.9(Kinematic) at 37.8 C


Cut Points YieldProduct Temp. C/F % Vol. Properties Unit ValueLight Naphtha <49 2.4 Light Naphtha

<120 Octane RON Clear Octane 78Int. Naphtha 49-121 7.7 Intermediate Naphtha



Freezing Point Temp. C/F 0.86Light Gas Oil 228-316 15 Light Gas Oil

443-600 Sulfur Content % Wt. 0.07Int. Gas Oil 316-455 23.3 Intermediate Gas Oil

600-850 Sulfur Content % Wt. 0.13Residue >346 55.4 Residue

>655 Sulfur Content % Wt. 0.22Pour Point Temp. C/F Sep-48Vanadium Parts/mill. 1.1



BOURI Libya

Gravity: 26.0 Loading Port: Bouri

Production

After declining to about 60,000 barrels a day output is being restored to previous highsof about 90,000 b/d. A second phase of development could take production consider-ably higher in the future. The Mediterranean�s largest offshore oil field, with 5-billion bar-rels of oil and considerable gas, was discovered in the early 1980s, but it did not beginproducing until 1991.

Quality

Libya�s heaviest crude oil stream is of unusually low quality compared to other NorthAfrican oils. High natural gas content at the wellhead complicates the productionprocess.

Producer

Italian Agip is the operator under a production-sharing agreement with state NOC inwhich its share is now 30%, up from the previous level of 19%.


Bouri crude oil almost never appears on the international market, and it is absorbedentirely in producer Agip�s downstream system. This is understandable given the crudeoil�s relatively poor quality. Prices are generally $2-$3 a barrel below North Sea Brent,but they are largely notional.

Seller


Loading Port

Bouri. 33.54 N. 12.39 E. An offshore loading facility in the Mediterranean Sea locatednear the field�s two production platforms off the northwest coast of Libya. The facilityhas 1.3-million barrels of storage.


BOURI ASSAY

Assay not available.


BREGA Libya

Gravity: 39.8 Sulfur: 0.20 Loading Port: Marsa El Brega

Production

About 120,000 barrels a day mainly from the Nafoora-Augila complex of fields discov-ered in 1966 about 200 miles southeast of the Marsa El Brega terminal and between theAmal and Bu Attifel fields. Despite enhanced recovery efforts, output is in decline.

Quality

Light, high-quality North African oil.

Producers

All output is controlled by Arabian Gulf Oil Co., a fully owned subsidiary of stateNational Oil Co.


All export sales are handled by NOC with prices set close to similar-quality Zueitinacrude oil in recent years. Libyan price formulas are tied to the spot price of UK BrentBlend. In 1995-96 all Brega export volumes were going to Libya�s downstream refiningand marketing operations in Italy through its Tamoil affiliate.

Sellers


Loading Port

Marsa El Brega. 30.25 N. 19.34 E. Located on the southeastern shore of the Gulf of Sirte,Marsa El Brega has three crude oil-loading berths with the following restrictions: No. 2,42 feet draft, 65,000 deadweight tons; No. 3, 48 ft draft, 100,000 dwt; No. 5 (single-pointmooring), unrestricted draft, 300,000 dwt.


BREGA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.8 Sulfur Content % Weight 0.2Barrels /Metric Ton 7.624 Pour Point Temp. C 0Viscosity Centistokes 3 Reid Vapor Press. Lbs/Sq. In. 5.3(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 2 1.4Light Naphtha <85 8.9 7.3 Light Naphtha



Kerosine 165-235 14.3 13.8 Kerosine329-455






Pour Point Temp. C/F 42/107.6Viscosity (Kin) Cen at 60 C 68.1Asphaltenes % Wt. 0.27Conradson Carbon R % Wt. 2.99Vanadium Parts/mill. 3


BREGA TERM CONTRACT PRICES, 1987-93

At Port Of Loading In Dollars Per BarrelMonth 1987 1988 1989 1990 1991 1992 1993Jan. $17.90 $18.67 $15.18 $21.30 $22.14 $18.93 $17.72 Feb. 18.67 15.35 14.63 19.77 19.95 17.95 18.65March 18.67 14.30 16.20 18.34 19.38 18.80 18.82April 18.67 16.25 20.82 16.37 20.27 19.83 18.75May 18.67 16.05 19.40 16.31 18.91 20.90 18.50June 18.67 15.20 18.07 15.08 18.34 20.81 17.55July 18.67 14.65 16.62 17.13 19.86 20.28 16.79Aug. 18.67 14.70 16.72 27.31 20.34 20.07 16.75Sept. 18.67 13.05 17.72 36.95 21.67 20.53 16.10Oct. 18.67 12.25 18.95 37.05 22.40 19.79 16.48Nov. 18.67 12.85 18.75 34.21 19.85 18.83 15.03Dec. 18.67 15.05 19.95 29.05 18.48 17.94 13.53Note: More recent prices can be found in Chapter I.


ES SIDER Libya

Gravity: 37.0 Sulfur: 0.27 Loading Port: Es Sider

Production

The country�s largest volume crude oil stream at about 440,000-450,000 barrels a dayfrom the main fields of Defa, Dahra, Gialo, and Waha.

Quality

Libya�s benchmark grade. A high-quality, light, sweet North African crude oil.

Producers

The operator was the US Oasis group, now renamed Waha. Its equity stakes were divid-ed among state National Oil Co. (59.2%), Conoco (16.3%), Marathon (16.3%), andAmerada Hess (8.2%). However, the involvement of the American companies was com-pletely suspended following US sanctions against Libya in 1986. US firms are prohibitedfrom all Libyan activities, but the companies and the Libyans still hope to eventuallyresume joint operations. Meanwhile, control is in the hands of NOC.


Es Sider is Libya�s main export grade, and it used to be regularly traded on Mediterraneanspot markets. NOC has gradually cut back on spot sales, preferring to sell its crude oilto its downstream refining and marketing operations in Italy, Switzerland, and Germany,as well as in state-to-state deals and third-party sales to equity producers andMediterranean refiners. State NOC�s term-contract prices for Es Sider and other grades arebased on a formula tied to the spot market for UK Brent Blend.

Es Sider has the widest range of customers. In 1996 the largest buyers in this groupincluded OMV, an equity producer in Libya, as well as Libya�s Italian refining and mar-keting affiliate Tamoil. Italian independent refiners Isab and Api, Portugal's Petrogal andTurkey�s Tupras were also buyers. NOC also runs about 100,000 b/d as feedstock for itsdomestic refineries.

Seller


Loading Port

Es Sider. 30.38 N. 18.22 E. Located on the Gulf of Sirte approximately 375 miles south-southeast of Tripoli, the port of Es Sider has three conventional berths and two single-buoy mooring berths. Draft and/or tonnage limitations are as follows: numbers 1, 2, and3 � 51 feet draft; no. 4 � 62 ft draft, maximum vessel size 250,000 deadweight tons;no. 5 � 73 ft draft, maximum vessel size 300,000 dwt.


ES SIDER ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 37 Sulfur Content % Weight 0.27Barrels /Metric Ton 7.497 Pour Point Temp. C 9Viscosity Centistokes 4.8 Reid Vapor Press. Lbs/Sq. In. 7.2(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 3.2 2.1Light Naphtha <85 8.6 7 Light Naphtha

<185 Octane RON Clear Octane 70Int. Naphtha 85-165 15 13.5 Intermediate Naphtha










ES SIDER TERM-CONTRACT PRICES, 1978-93At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.80 $14.52 $34.50 $40.78 $36.50 $35.15 $30.15 $30.15 Feb. 13.80 15.20 34.50 40.78 36.50 30.15 30.15 30.15March 13.80 15.90 34.50 40.78 36.50 30.15 30.15 30.15April 13.68 18.08 34.50 40.78 35.15 30.15 30.15 30.15May 13.68 21.09 36.50 40.78 35.15 30.15 30.15 30.15June 13.68 21.09 36.50 40.78 35.15 30.15 30.15 30.15July 13.68 23.28 36.78 39.68 35.15 30.15 30.15 30.15Aug. 13.68 23.28 36.78 39.68 35.15 30.15 30.15 30.15Sept. 13.68 23.28 36.78 39.68 35.15 30.15 30.15 30.15Oct. 13.68 26.05 36.78 39.68 35.15 30.15 30.15 30.15Nov. 13.68 26.05 36.78 37.28 35.15 30.15 30.15 30.15Dec. 13.68 29.78 36.78 37.28 35.15 30.15 30.15 30.15Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $25.75 $17.60 $18.52 $14.95 $20.85 $20.84 $17.93 $17.12 Feb. 16.55 18.52 15.05 14.40 19.32 18.65 17.05 18.10March 13.20 18.52 14.10 15.97 17.89 18.22 17.85 18.27April 11.70 18.52 15.95 20.60 15.97 19.27 18.88 18.20May 12.45 18.52 15.75 19.15 15.91 17.99 20.10 17.95June 10.50 18.52 14.90 17.85 14.68 17.54 20.06 16.95July 8.65 18.52 14.35 16.20 16.68 19.06 19.53 16.19Aug. 12.30 18.52 14.40 16.30 26.91 19.54 19.37 16.15Sept. 13.15 18.52 12.75 17.30 36.60 20.82 19.83 15.50Oct. 12.90 18.52 11.95 18.52 36.25 21.55 19.14 15.88Nov. 13.70 18.52 12.55 18.32 32.96 18.95 18.23 14.44Dec. 15.00 18.52 14.75 19.52 27.75 17.48 17.34 12.93Note: More recent prices can be found in Chapter I.


SARIR Libya

Gravity: 37.6 Sulfur: 0.16 Loading Port: Marsa El Hariga

Production

About 190,000-200,000 barrels a day from the Sarir and North Sarir fields.

Quality

A light, sweet crude oil with a high wax content that gives it a high pour point and makesit difficult to handle.

Producers

Output is 100% controlled by state National Oil Co. through its affiliate, Arabian Gulf OilCo. (Agoco).


All export sales are handled by NOC, with prices in the same range as for similar-quali-ty Amna crude oil. Libyan price formulas are tied to the spot price of UK Brent Blend.Due to a US embargo, export sales are mainly in the Mediterranean. Libya�s Italian affil-iate Tamoil is a regular lifter, as are Italian independent refiners Isab and Api, each tak-ing about 20,000 b/d in 1996. Other customers include France�s Elf, Turkey�s Tupras, andGreece. About 70,000 b/d are used in Libya�s domestic refineries. Some spot sales havegone to Asia when prices there are attractive.

Seller


Loading Port

Marsa El Hariga. 32.04 N. 24.00 E. The Mediterranean oil-loading terminal at Marsa ElHariga � located on the south side of the harbor of Tobruk, about 100 miles west of theLibya-Egypt border � accommodates loading at two jetty berths at a maximum draft of56 feet. There is also a loading buoy system.


SARIR ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 37.6 Sulfur Content % Wt 0.16Barrels /Metric Ton 7.524 Pour Point Temp. C 21Viscosity Centistokes 7.28 Reid Vapor Press. Lbs/Sq. In. 4.8(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1











Pour Point Temp. C/F 39/102.2Viscosity (Kin) Cen at 60 C 82.2Asphaltenes % Wt. 1Conradson Carbon R % Wt. 2.99Vanadium Parts/mill. 2



SIRTICA Libya

Gravity: 42.2 Sulfur: 0.40 Loading Port: Ras Lanuf

Production

About 85,000 barrels a day mainly from the onshore Zelten field.

Quality

A high-quality, light, sweet North African crude oil.

Producers

Sirte is the operator, and it is owned 100% by state National Oil Co. US Exxon and W.R.Grace were former concessionaires.


Sirtica is one of Libya�s top-quality crude oils, making it relatively easy to sell in itsrestricted European market. In 1996, NOC�s customers for the grade were Austrian OMV,German Veba and Repsol, all equity producers in Libya, as well as Spanish refiner Cepsa.About 30,000 b/d is used in the Ras Lanuf refinery. NOC�s term-contract prices are basedon a formula tied to the spot market for UK Brent Blend.

Seller


Loading Port

Ras Lanuf. 30.31 N. 18.35 E. Two terminals located on the southeastern side of the Gulfof Sirte about 12 miles (20 kilometers) south of Es Sider. The former Mobil terminal hasthree conventional berths designed for tankers of up to 60 feet draft and 130,000 dead-weight tons, and one single-buoy mooring intended for vessels of up to 75 ft of draft and265,000 dwt. The second terminal has two crude oil-loading berths, with maximum sizeof 50,000 dwt and 41 ft draft.


SIRTICA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 42.2 Sulfur Content % Weight 0.4Barrels /Metric Ton 7.727 Pour Point Temp. C 0Viscosity Centistokes 4.2 Reid Vapor Press. Lbs/Sq. In. 8.7(Kinematic) at 20 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 4.1 2.8Light Naphtha <85 12 9.9 Light Naphtha







Cloud Point Temp. C 7Cetane Index 58.5Viscosity (Kin) Cen at 40 C 6





ZUEITINA Libya

Gravity: 41.5 Sulfur: 0.31 Loading Port: ZueitinaOther Names: Libyan Light

Production

Output has been in decline, falling to about 70,000 barrels a day in 1995-96 from theIntisar system, which is a network of five fields.

Quality

A light, sweet crude oil similar to US West Texas Intermediate.

Producers

Zueitina Oil Co., a joint venture between state National Oil Co. (87.5%) and AustrianOMV (12.5%), which replaced the former US Occidental-led producing group after theforced withdrawal of US companies in 1986 due to Washington�s sanctions.


The grade is sometimes traded in the Mediterranean, but NOC mainly sells it to its Italianaffiliate Tamoil and equity producers such as Austrian OMV and German Veba. Likeother Libyan grades, the price formula is tied to dated Brent, and price terms are set ona monthly basis. Zueitina is usually the highest-priced Libyan export grade.

Sellers


OMV AG: Otto Wagner Platz 5, A-1090, Vienna, Austria. Tel.: (43-1) 404-400, Fax: (43-1) 9453.

OMV (UK) Ltd.: 14 Ryder St., London SW1Y 6QB, UK. Tel.: (44-171) 333-1600, Fax:(44-171) 333-1610.

Loading Port

Zueitina. 30.51 N. 20.00 E. The Zueitina sea terminal consists of five crude oil-loadingberths, two of which are conventional-buoy moorings and three of which are single-buoymoorings. The CBM berths are 2.5 miles offshore at an average depth of 70-80 feet, whilethe SBM berths are approximately three miles offshore at an average depth of 100 ft.


ZUEITINA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 41.5 Sulfur Content % Weight 0.31Barrels /Metric Ton 7.699 Pour Point Temp. C 12Viscosity Centistokes 3.13 Reid Vapor Press. Lbs/Sq. In. 5.6(Kinematic) at 40 C













ZUEITINA TERM-CONTRACT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $30.40 $17.85 $18.67 $15.20 $21.35 $24.68 $18.98 $17.72 Feb. 30.40 18.67 15.40 14.65 19.82 19.96 18.05 18.65March 30.40 18.67 14.40 16.22 18.39 19.56 18.85 18.82April 30.40 18.67 16.25 20.87 16.42 20.27 19.83 18.75May 13.00 18.67 16.05 19.45 16.36 19.06 20.90 18.50June 11.25 18.67 15.20 18.12 15.13 18.76 20.81 17.55July 9.10 18.67 14.65 16.65 17.18 19.86 20.28 16.84Aug. 12.75 18.67 14.70 16.75 27.36 20.34 20.07 16.80Sept. 13.35 18.67 13.05 17.75 37.00 21.67 20.53 16.15Oct. 13.25 18.67 12.25 18.97 37.20 22.45 19.79 16.53Nov. 14.05 18.67 12.85 18.77 34.26 19.90 18.83 15.08Dec. 15.30 18.67 15.05 19.97 29.05 18.53 17.94 13.58

ZUEITINA SPOT PRICES, 1987-93Month 1987 1988 1989 1990 1991 1992 1993Jan. $17.85 $16.50 $17.10 $21.25 $24.45 $24.45 $17.45 Feb. 17.00 15.40 16.75 19.75 20.45 20.45 18.55March 17.55 14.40 18.50 18.35 19.85 19.85 18.85April 18.00 16.30 20.05 16.55 19.55 19.55 18.70May 18.45 16.05 18.60 16.25 19.40 19.40 18.60June 18.70 15.30 17.40 14.90 18.20 18.20 17.75July 19.30 14.80 17.50 16.95 19.55 19.55 16.95Aug. 18.70 14.75 16.65 26.45 19.85 19.85 16.85Sept. 17.85 12.95 17.70 33.55 20.75 20.75 16.15Oct. 18.35 12.20 18.80 37.15 22.60 22.60 16.60Nov. 17.45 12.90 18.60 33.75 21.70 21.70 15.20Dec. 16.80 15.40 19.75 28.95 18.95 18.95 13.65Note: More recent prices can be found in Chapter I.


BINTULU CONDENSATE Malaysia

Gravity: 66.2 Sulfur: 0.04 Loading Port: Bintulu

Production

About 60,000 barrels a day of condensate from offshore fields on the northern coast ofSarawak (Borneo) in eastern Malaysia, just to the west of Brunei. Condensate output isgrowing as associated natural gas production increases. Volumes are expected to reach100,000 b/d or more by 2000. The area produces large volumes of natural gas forMalaysia�s liquefied natural gas export projects. Bintulu grade, which is also light and lowin sulfur, was included in the condensate export stream until 1991, but it is now soldseparately. Its output is less than 50,000 b/d.

Quality

Very light condensate with excellent petrochemical and gasoline manufacturing charac-teristics.

Producer

Operated by the Royal Dutch/Shell Group under a production-sharing contract with statePetronas.


Up until early 1996, volumes were used almost exclusively in the domestic Malacca refin-ery, but exports are increasingly common, with the first term contracts pricing the gradeat a slight discount to Malaysian benchmark Tapis grade.

Sellers

Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi,Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60-3) 274-8011, Telex: MA31123 PETRON.

Loading Port

Bintulu. 03.16 N. 113.04 E. The Bintulu terminal, located off the coast of Sarawak, con-sists of a single-buoy mooring loading system positioned in the open sea. The facilitiescan accommodate tankers with a maximum 320,000 deadweight tons and a maximumdraft of 52 feet.


BINTULU CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 66.2 Sulfur Content % Weight 0.04Barrels /Metric Ton 8.8 Pour Point Temp. C -37Viscosity Centistokes 0.58 Reid Vapor Press. Lbs/sq. in. 6(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. Properties Unit ValueLPG 2.6Light Gasoline 15-65 33.7 Light Gasoline

59-149 Paraffins % Wt. 91Naphthenes % Wt. 8Aromatics % Wt. 0.4

Light Naphtha 65-90 19.2 Light Naphtha149-194 Paraffins % Wt. 42

Naphthenes % Wt. 55Aromatics % Wt. 2.6

Int. Naphtha 90-115 17.7 Intermediate Naphtha194-239 Paraffins % Wt. 32


Heavy Naphtha 115-140 9.1 Heavy Naphtha239-284 Paraffins % Wt. 40


Jet Kerosine 140-165 5.5 Jet Kerosine284-329 Smoke Point Temp. C 18

Freezing Point Temp. C -54Kerosine 185-200 4.7Gas Oil 200-225 2.6Residue >225 4.9



DULANG Malaysia

Gravity: 39.9 Sulfur: 0.12 Loading Port: Dulang Terminal

Production

About 100,000 barrels a day from a group of small fields off the east coast of the MalayPeninsula adjacent to Exxon�s Trengganu area. Output is expected to grow, but flowrates are subject to the restrictions of Malaysia�s national depletion policy. The fieldextends into Exxon�s area, and the firm receives a share of the output under a unitiza-tion agreement.

Quality

A light, low-sulfur crude oil with high wax content and a high pour point. Quality is vari-able, with high metals content making the grade undesirable for cracking and thus oftenrelegated to use as boiler feed.

Producer

Operated by Petronas Carigali, the upstream unit of state Petronas. Exxon receives abouta 20% share of production because the field extends into its area.


All production is exported, but the grade is used mainly as a boiler fuel in southern Chinaand Japan. As with other Malaysian crude oils, Petronas sets prices retroactively at theend of each month in response to Asian spot market trends.

Seller


Loading Port

Dulang. 05.45 N. 104.10 E. A deep-water offshore loading terminal supported by a float-ing storage vessel.


DULANG ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.9 Sulfur Content % Weight 0.12Barrels /Metric Ton 7.64 Pour Point Temp. C 30Viscosity Centistokes 3.342 Flash Point Temp. C 13.5(Kinematic) at 50 C Hydrogen Sulfide Parts/mill. 0.002Wax Content % Wt. 12.6 Water Content % Vol. 0.05Asphaltenes Con. % Wt. 0.1 Conradson Car. R % Wt. 0.36


No refined product breakdown available.


LABUAN Malaysia

Gravity: 32.1 Sulfur: 0.07 Loading Port: Labuan

Production

About 80,000 barrels a day from offshore fields on the north coast of Sabah Province(Borneo) in eastern Malaysia. Output peaked in 1990 at around 120,000 b/d, and it isnow in decline from the Samarang, Ketam, West Erb, St. Joseph, St. Furious, Barton, andTembungo fields that make up the stream.

Quality

A medium-gravity, low-sulfur Asian crude oil with an excellent middle distillate yield,which makes it popular for both straight-run refining and cracking.

Producers

The Royal Dutch/Shell Group operates all of the fields under a production-sharing agree-ment with state Petronas.


About 60,000 b/d of production is exported, but the low-sulfur grade rarely leaves theFar East and often ends up in Singapore. Japanese buyers take about 35,000 b/d. Like allof Malaysia�s five export grades, Labuan is priced retroactively by state Petronas basedon spot quotes for Tapis appearing in Platt�s and Asian Petroleum Price Index plus a vari-able monthly differential. Prices are generally quite close to much lighter Tapis, reflect-ing successful niche marketing by Petronas.

Sellers

Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi,Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60) 3-274-8011, Telex: MA31123 PETRON.

Shell Malaysia Trading Sdn. Bhd.: Jalan Semantan, Damansara Heights, KualaLumpur, Malaysia. Tel.: (60-3) 255-9144, Fax: (60-3) 251-2957.

Shell International Eastern Trading Co.: 50 Raffles Place, #39-00 Shell Tower, 0104Singapore. Tel.: (65) 224-7777, Fax: (65) 224-0379.

Loading Port

Labuan. 05.17 N. 115.15 E. The Labuan terminal is located on the island of Labuan, 4.5miles off the northwest coast of Borneo at the entrance to Brunei Bay. The single-buoymooring loading berth is designed for tankers of up to 320,000 deadweight tons andmaximum draft of 74 feet.


LABUAN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.1 Sulfur Content % Weight 0.07Barrels /Metric Ton 7.28 Pour Point Temp. C 9Viscosity Centistokes 2.67 Reid Vapor Press. Lbs/sq. in. 3.3(Kinematic) at 40 C







455-572 Sulfur % Wt. 0.04Cloud Point Temp. C -31Cetane Index 34.9




Pour Point Temp. C/F 39/102.2Viscosity (Kin) Cen at 60 C 40Asphaltenes % Wt. 0.06Conradson Carbon R % Wt. 1.3Vanadium Parts/mill. <1



MIRI Malaysia

Gravity: 29.6 Sulfur: 0.07 Loading Port: MiriOther Names: Miri Light

Production

About 60,000 barrels a day from a group of offshore fields on the northern coast of theprovince of Sarawak (Borneo) in eastern Malaysia and from the onshore Miri field. Thefields lie along the western border of Brunei and in addition to Miri include Baram,Bakau, Baronia, Betty, Bokor, Tukau, and Siwa. Production is in decline after peaking atabout 140,000 b/d in 1990.

Quality

A typical low-sulfur Asian crude oil with high wax content and high pour point. Thegrade was significantly lighter in the early 1980s, and quality has deteriorated as satellitefields have been introduced into the stream.

Producers

The Royal Dutch/Shell Group controls 100% of all of the fields through its Shell Sarawakaffiliate under a production-sharing agreement with state Petronas.


About 45,000 b/d is exported. It often goes to Singapore as well as to Northeast Asia,with Japan taking about 30,000 b/d mainly for use as boiler fuel. Shell also uses the gradein its domestic refining system in Malaysia. Like all of Malaysia�s five export grades, Miriis priced retroactively by state Petronas on the basis of spot quotes for Tapis from Platt�sand the Asian Petroleum Price Index plus a variable differential. Prices are generallyquite close to Tapis despite its inferior quality.

Sellers

Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi,Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60) 3-274-8011, Telex: MA31123 PETRON.

Shell Malaysia Trading Sdn. Bhd.: Jalan Semantan, Damansara Heights, KualaLumpur, Malaysia. Tel.: (60-3) 255-9144, Fax: (60-3) 251-2957.

Shell International Eastern Trading Co.: 50 Raffles Place, #39-00 Shell Tower, 0104Singapore. Tel.: (65) 224-7777, Fax: (65) 224-0379.

Loading Port

Miri. 04.26 N. 113.55 E. The Miri terminal, located off the coast of Sarawak, has four sin-gle-buoy mooring berths situated in the open sea. The following maximum specificationshold: No. 1 � draft 37 feet, tonnage 30,000 deadweight tons; No. 2 � 37 ft, 75,000 dwt;No. 4 � 39 ft, 100,000 dwt; No. 5 � 56 ft, 125,000 dwt.


MIRI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 29.6 Sulfur Content % Weight 0.07Barrels /Metric Ton 7.18 Pour Point Temp. C 12Viscosity Centistokes 4.208 Flash Point Temp. C -18(Kinematic) at 50 C Hydrogen Sulfide Parts/mill. 26Wax Content % Wt. 38 Water Content % Vol. <0.05Asphaltenes % Wt. 0.47


No refined product breakdown available.

MIRI TERM-CONTRACT PRICES, 1978-93

Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. ... $15.05 $33.60 $41.30 $36.50 $35.60 $29.85 $29.85 Feb. ... 15.05 33.60 40.80 36.50 29.85 29.85 27.95March ... 16.18 35.30 40.80 36.50 29.85 29.85 27.95April ... 18.45 35.30 40.80 35.60 29.85 29.85 27.95May ... 18.45 35.30 39.80 35.60 29.85 29.85 27.95June ... 20.90 37.30 39.10 35.60 29.85 29.85 27.95July ... 23.70 37.30 37.10 35.60 29.85 29.85 27.25Aug. ... 23.70 37.30 37.10 35.60 29.85 29.85 27.25Sept. ... 23.70 37.30 37.10 35.60 29.85 29.85 27.25Oct. 14.30 23.70 37.30 37.10 35.60 29.85 29.85 27.25Nov. 14.30 26.75 37.30 37.10 35.60 29.85 29.85 27.25Dec. 14.30 26.75 37.80 37.10 35.60 29.85 29.85 27.25Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $27.25 $17.35 $16.90 $16.45 $20.05 $27.30 $21.15 $19.20 Feb. 23.25 17.85 17.25 17.95 20.45 22.70 19.50 19.00March ... 17.75 16.75 17.80 19.95 19.30 18.65 20.05April ... 17.75 16.10 18.80 18.65 18.30 18.25 20.70May ... 17.90 16.70 19.25 16.70 18.70 19.60 20.25June ... 18.15 16.70 18.80 15.45 19.70 21.20 19.40July ... 18.35 14.75 18.55 15.00 19.90 22.85 18.85Aug. 10.80 18.60 14.65 17.70 20.90 20.10 22.45 18.85Sept. 12.45 18.35 14.00 17.40 29.60 20.30 21.65 18.85Oct. 13.30 18.15 12.40 18.15 38.80 21.60 21.35 18.20Nov. 13.80 18.40 12.10 18.90 36.20 22.65 21.15 17.60Dec. 14.15 17.90 13.70 19.25 31.40 23.30 20.30 15.95Note: More recent prices can be found in Chapter I.


TAPIS Malaysia

Gravity: 45.2 Sulfur: 0.03 Loading Port: TapisOther Names: Tapis Blend, Pulai

Production

About 340,000 barrels a day is produced from a cluster of fields offshore the eastern coastof the Malaysian Peninsula. Output is expected to decline gradually from these maturefields, and flow rates are also subject to the restrictions of Malaysia�s national depletionpolicy.

Quality

A high-quality, light, low-sulfur Asian crude oil. Especially prized for its wide cut of kero-sine and gas oil. However, the smoke point of the kerosine can pose quality problems.

Producers

Exxon holds 100% of the fields and operates under a production-sharing agreement withstate Petronas.


The spot market for this light, sweet grade provides a marker for the region with aboutfour to six �wet� barrel spot deals a month. Although both Exxon and Petronas are sell-ers, Exxon uses the grade mainly in its own downstream system and Petronas also hasbeen using more domestically. Exports amount to about 150,000-200,000 b/d, with salesall over the region. Japan imported about 25,000 b/d in 1995, and significant volumesare also refined in Singapore. Other customers include South Korea, India, Indonesia,and Thailand. Petronas uses a monthly retroactive official selling price that is tied direct-ly to average quotes from Platt�s and the Asia Petroleum Price Index plus an adjustmentfactor. Tapis also provides the basis for extensive paper trading and swaps.

Sellers


Exxon Malaysia Berhad: Kompleks Antarabangsa, Jalan Sultan Ismail, 50718 KualaLumpur, Malaysia. Tel.: (60-3) 240-3087, Fax: (60-3) 242-2322.

Exxon Singapore Private Limited: 1 Raffles Place, #37-00 OUB Centre, 0104Singapore. Tel.: (65) 535-5533, Fax: (65) 535-2797.

Loading Port

Tapis. 05.31 N. 105.01 E. The Tapis terminal is a deep-water offshore loading and stor-age facility located in the South China Sea. Maximum vessel size is 100,000 deadweighttons.


TAPIS ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 45.2 Sulfur Content % Weight 0.03Barrels /Metric Ton 7.863 Pour Point Temp. C 6Viscosity Centistokes 1.72 Reid Vapor Press. Lbs/Sq. In. 5.2(Kinematic) at 40 C


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 1.9 1.3Light Naphtha <85 6.2 5.2 Light NaphthaInt. Naphtha 85-165 20.7 19.7 Intermediate Naphtha


Kerosine 165-235 25 24.6 Kerosine329-455 Sulfur Content % Wt. <0.01

Light Gas Oil 235-300 19.4 20 Light Gas Oil455-572 Sulfur Content % Wt. 0.02





Pour Point Temp. C/F 42/107.6Viscosity (Kin) Cen at 60 C 15.7Asphaltenes % Wt. 0.4Vanadium Parts/mill. 5


TAPIS TERM-CONTRACT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $27.90 $18.00 $17.20 $16.75 $20.35 $27.60 $21.45 $19.50 Feb. 23.90 18.55 17.55 18.25 20.75 23.00 19.80 19.30March 17.10 18.45 17.05 18.10 20.25 19.60 18.95 20.35April 13.50 18.45 16.40 19.10 18.95 18.60 18.55 21.00May 12.50 18.60 17.00 19.55 17.00 19.00 19.90 20.55June 12.85 18.85 17.00 19.10 15.75 19.90 21.50 19.70July 10.50 19.05 15.05 18.85 15.30 20.20 23.15 18.95Aug. 11.35 19.30 14.95 18.00 21.00 20.30 22.75 18.95Sept. 13.00 18.85 14.30 17.70 29.70 20.90 21.95 18.95Oct. 13.80 18.80 12.70 18.45 39.10 21.90 21.65 18.30Nov. 14.35 18.80 12.40 19.20 36.50 22.95 21.45 17.70Dec. 14.80 18.00 14.00 19.55 31.70 23.60 20.60 16.05

TAPIS SPOT PRICES, 1987-93Month 1987 1988 1989 1990 1991 1992 1993Jan. $18.20 $17.40 $18.00 $20.60 $24.85 $20.30 $19.00 Feb. 18.40 17.55 18.00 20.45 21.30 19.45 19.65March 18.25 16.15 18.35 19.75 18.95 18.35 20.80April 18.55 17.00 19.60 18.20 18.60 18.95 20.80May 18.60 17.10 19.20 16.75 19.30 20.35 20.30June 18.80 16.50 19.00 15.25 19.95 22.35 19.20July 19.20 14.95 18.55 16.50 20.10 23.25 18.80Aug. 19.20 14.95 17.65 25.60 20.40 22.55 19.00Sept. 18.65 13.90 17.80 31.90 21.40 21.75 18.40Oct. 18.85 12.45 18.85 38.55 22.40 21.50 18.25Nov. 18.60 12.95 19.35 35.50 23.50 21.15 17.00Dec. 17.45 15.30 19.80 29.10 22.70 20.05 15.55Note: More recent prices can be found in Chapter I.


ISTHMUS Mexico

Gravity: 33.3 Sulfur: 1.22 Loading Ports: Dos Bocas, Salina Cruz

ProductionIsthmus accounted for 920,000 barrels a day of Mexico�s 2.85-million b/d crude oil out-put in the first half of 1996. Most comes from multiple fields in shallow water or onshorealong the Bay of Campeche in southeastern Mexico. Isthmus is mainly refined domesti-cally, leaving only 200,000 b/d for exports.

QualitySimilar to Arabian Light and US West Texas Sour, Isthmus is a medium- to light-gravity,high-sulfur crude oil. However, it appears to have become somewhat lower in sulfur andheavier in recent years.

ProducerState Petroleos Mexicanos is the sole producer.

Pricing And MarketingExport barrels are sold almost exclusively on a term-contract basis and priced off a bas-ket of crude oil and fuel oil benchmarks with separate formulas for US, European, andFar East customers. Unlike other producers, Mexico does not use West TexasIntermediate as a pricing benchmark for its US sales.

For the US, the formula in late 1996 was 40% of the sum of West Texas Sour and LightLouisiana Sweet plus 20% of Dated Brent plus the adjustment factor. For Europe, the for-mula was 88.7% of the Dated Brent price plus 11.3% of the Rotterdam price of 3.5% sul-fur fuel oil minus 16% of the difference between 1% and 3.5% sulfur fuel oil plus anadjustment factor. For the Far East, the benchmark was the average of Oman and Dubaiover the calendar month of loading. All crude oil sales are made on an f.o.b. basis.

SellerPetroleos Mexicanos Internacional is the exclusive marketer of Isthmus grade and is a90%-owned subsidiary of Pemex.

PMI Mexico City: Av. Marina Nacional 329, Col. Huasteca, Piso 22, Mexico 11311,DF. Tel.: (525) 227-0121.

PMI Houston: 909 Fannin, Suite 3200, Houston, Texas 77010. Tel.: (713) 655-7333,Fax: (713) 951-0354.

PMI London: Grosvenor Place, London SWIX 7HB, UK. Tel.: (44-171) 823-2242, Fax:(44-171) 823-1813.

PMI Tokyo: 28 Mori Building, 10th Floor, 4-16-13, Nishi-Azabu, Minato-Ku, Tokyo106, Japan. Tel.: (03) 449-1481, Fax: (03) 499-1484.

Main CustomersSpanish Repsol, Chevron, Mobil, and Shell Oil are among the bigger buyers of Isthmus.Pemex also has a 65,000 b/d government-to-government deal with a group of Japaneserefiners.

Loading PortsDos Bocas (Caribbean). 18.37 N. 93.10 W. The Dos Bocas terminal, located on the south-ern shore of the Gulf of Campeche in Tabasco state, consists of two single-buoy moor-ings designed for loading tankers from 150,000-250,000 deadweight tons. A total of 10crude oil tanks provide 5-million barrels of storage capacity.Salina Cruz (Pacific). 16.10 N. 95.12 W. The Salina Cruz terminal is located on the westcoast of Mexico at the northern head of the Gulf of Tehuantepec. One of the three sin-gle-point moorings is designed for crude oil tankers between 100,000-250,000 dwt.


ISTHMUS ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 33.3 Sulfur Content % Weight 1.22Barrels /Metric Ton 7.34 Pour Point Temp. F -40Viscosity Centistokes 5.7(Kinematic) at 40 C








Residue >650 41.8 ResidueSulfur Content % Wt. 2.22Pour Point Temp. C/F 21


ISTHMUS TERM-CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.40 $14.10 $32.00 $38.50 $35.00 $32.50 $29.00 $29.00 Feb. 13.40 14.10 32.00 38.50 35.00 29.00 29.00 27.75March 13.40 14.10 32.00 38.50 32.50 29.00 29.00 27.75April 13.40 17.10 32.00 38.50 32.50 29.00 29.00 27.75May 13.40 17.10 33.50 38.50 32.50 29.00 29.00 27.75June 13.40 17.10 33.50 34.50 32.50 29.00 29.00 26.75July 13.10 22.60 34.50 36.50 32.50 29.00 29.00 26.54Aug. 13.10 22.60 34.50 34.00 32.50 29.00 29.00 26.54Sept. 13.10 22.60 34.50 34.00 32.50 29.00 29.00 26.54Oct. 13.10 24.60 34.50 34.00 32.50 29.00 29.00 27.15Nov. 13.10 24.60 34.50 35.00 32.50 29.00 29.00 27.15Dec. 13.10 24.60 38.50 35.00 32.50 29.00 29.00 26.11Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $21.09 $16.98 $15.41 $15.66 $19.18 $20.88 $15.99 $16.42 Feb. 15.57 16.60 14.37 15.88 18.33 16.62 15.95 17.35March 12.21 17.62 14.30 17.78 17.13 16.80 16.29 17.57April 11.98 17.80 15.65 19.26 15.04 17.90 17.46 17.77May 13.09 18.28 15.43 17.69 15.07 17.91 18.61 17.20June 10.80 18.62 14.19 17.31 13.68 17.11 19.73 16.01July 9.21 19.46 13.80 17.06 17.12 18.21 19.04 15.28Aug. 13.45 18.23 13.47 16.65 25.94 18.45 18.72 15.07Sept 13.48 17.82 12.40 17.06 33.61 19.26 19.24 15.13Oct. 13.18 17.96 11.46 17.43 33.11 20.38 19.03 15.14Nov. 13.56 16.95 11.91 17.91 30.03 18.48 18.13 13.81Dec. 15.18 15.29 13.94 19.51 25.66 16.04 16.79 12.37Note: Estimated volume-weighted average of US, European, and Asian prices from 1986. Note: More recent prices can be foundin Chapter I.


MAYA Mexico

Gravity: 21.5 Sulfur: 3.43 Loading Ports: Cayo Arcas, Salina CruzProductionOutput of Mexico�s largest crude oil stream was running at a steady 1.35-million barrelsa day in 1996, and is expected to rise by 250,000 b/d or more by late 1997. Maya is pro-duced from multiple offshore fields in the Bay of Campeche, just off the coast of Ciudaddel Carmen and the expansion in production is coming from investments in existingfields. Cantarell, which produces 1.1-million b/d, and Ku are the two largest producingareas. Maya exports averaged 860,000 b/d in the first half of 1996, making it the largestLatin American export grade.

QualityA typical heavy, high-sulfur Latin American crude oil. High metals content makes it par-ticularly difficult for cracking.

ProducersState Petroleos Mexicanos is the sole producer.

Pricing And MarketingMost Maya crude oil is sold on term contracts to customers in the US, Europe, and theFar East. The US Gulf Coast is the primary market and Pemex has managed to lock insome 110,000 b/d of sales through a joint-venture investment at Shell Oil�s Deer Park,Texas, refinery. Unlike other producers, Mexico does not use West Texas Intermediateas a pricing benchmark for its US sales.

Prices are set on a monthly basis using a multiple crude oil and fuel oil formula. Inlate 1996, the formulas were as follows: for Europe, 52.7% of the Dated Brent price plus46.7% of 3.5% sulfur fuel oil minus 25% of the difference between 1% sulfur fuel oil and3.5% sulfur fuel oil minus a differential; for the US, 40% of the sum of West Texas Sourand 3% sulfur fuel oil plus 10% of the sum of Light Louisiana Sweet and Dated Brentminus a differential; and for Asia, the average of Dubai and Oman less a differential.

SellersPetroleos Mexicanos Internacional is the exclusive marketer of Isthmus grade and is a90%-owned subsidiary of Pemex.




PMI Tokyo: 28 Mori Building, 10th Floor, 4-16-13, Nishi-Azabu, Minato-Ku, Tokyo106, Japan. Tel.: (03) 449-1481, Fax: (03) 499-1484.Main CustomersSophisticated US refiners are the main purchasers of Maya, with the Shell-Pemex jointventure taking 110,000 b/d and other large buyers including Mobil, Chevron, Conoco,and Amoco. For quality reasons, the grade is harder to market to Europe and Asia.Japanese refiners only take about 10,000 b/d.

Loading PortsCayo Arcas (Caribbean). 20.11 N. 91.59 W. Cayo Arcas is an open-sea terminal situatedapproximately 85 miles west of Campeche in the Gulf of Mexico. Facilities include twosingle-buoy moorings and two storage tankers. Size restrictions are 250,000 maximumdeadweight tons at SBM 2 and 350,000 dwt at SBM 3.Salina Cruz (Pacific). 16.10 N. 95.12 W (see Isthmus, px for details).


MAYA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 21.5 Sulfur Content % Weight 3.43Barrels /Metric Ton 6.816 Pour Point Temp. F -20Viscosity Centistokes 71(Kinematic) at 40 C






Kerosine 400-500 8 KerosineSulfur Content % Wt. 1.23Freezing Point Temp. F. -29


Residue >650 59.4 ResidueSulfur Content % Wt. 4.75Pour Point Temp. C/F 72


MAYA TERM-CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.40 $14.10 $28.00 $34.50 $26.50 $25.00 $25.00 $25.50 Feb. 13.40 14.10 28.00 34.50 26.50 23.00 25.00 25.50March 13.40 14.10 28.00 34.50 25.00 23.00 25.00 25.50April 13.40 17.10 28.00 32.00 25.00 23.00 25.00 25.50May 13.40 17.10 33.50 32.00 25.00 23.00 25.50 25.50June 13.40 17.10 33.50 28.00 25.00 23.00 25.50 24.00July 13.10 22.60 29.00 30.00 25.00 23.00 25.50 23.45Aug. 13.10 22.60 29.00 28.50 25.00 24.00 25.50 23.45Sept. 13.10 22.60 29.00 28.50 25.00 24.00 25.50 23.45Oct. 13.10 24.60 29.00 28.50 25.00 25.00 25.50 23.05Nov. 13.10 24.60 29.00 35.00 25.00 25.00 25.50 23.05Dec. 13.10 24.60 34.50 35.00 25.00 25.00 25.50 21.98Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $19.34 $14.66 $12.06 $12.36 $15.12 $16.09 $9.93 $11.95 Feb. 13.80 14.54 11.88 12.42 14.16 11.18 10.18 12.58March 10.71 15.01 10.91 13.56 13.09 11.55 10.50 12.98April 9.36 15.81 12.75 15.95 11.48 12.79 12.25 13.05May 9.38 16.97 13.02 15.57 11.13 12.80 13.99 12.34June 9.02 17.12 11.92 15.23 9.59 12.36 15.25 11.22July 7.56 17.78 11.16 15.23 11.85 13.39 15.30 11.03Aug. 9.66 16.80 11.51 14.17 20.36 13.05 14.80 11.29Sept. 10.63 15.50 9.91 14.41 25.26 13.41 15.07 11.43Oct. 10.85 15.81 8.66 14.97 26.40 14.38 15.29 11.24Nov. 10.90 14.87 9.11 14.99 23.93 13.54 14.51 9.81Dec. 11.66 11.61 10.50 16.73 20.55 10.74 12.56 9.00Note: Estimated volume-weighted average of US, European, and Asian prices from 1986. Note: More recent prices can be foundin Chapter I.


OLMECA Mexico

Gravity: 39.1 Sulfur: 0.72 Loading Port: Dos Bocas

Production

Split out of the Isthmus crude stream in 1988, Olmeca is produced from the Bay ofCampeche and southern onshore fields. Volumes are rising with higher output of lightcrude oil, reaching an average of 580,000 barrels a day in first-half 1996 and are due torise further. Exports of light crude oil are being maximized to boost export earnings, andinternational sales of Olmeca amounted to 480,000 b/d in first-half 1996.

Quality

Mexico�s light, low-sulfur export crude oil is not as good for making gasoline as US WestTexas Intermediate, but it provides good feedstock for lubricants and petrochemicals.

Producers

State Petroleos Mexicanos is the sole producer.


Exports have almost doubled since the early 1990s and are likely to reach 500,000 b/din 1997. Olmeca is sold primarily on a term-contract basis to US customers, althoughsome cargoes do go to Europe. The grade has become especially popular with sweetcrude oil refiners on the US Gulf Coast. Unlike other producers, Mexico does not useWest Texas Intermediate as a pricing benchmark for its US sales.

Prices are set on a monthly basis using the following formula for the US: the averageof dated Brent, Light Louisiana Sweet, and West Texas Sour, minus a small differential.

Sellers

Petroleos Mexicanos Internacional is the exclusive marketer of Isthmus grade and is a90%-owned subsidiary of Pemex.




Main Customers

US Gulf Coast refiners are the primary outlet, with traditional buyers such as Chevron,Exxon, Shell Oil, and Mobil being supplemented by sales to sweet crude oil refiners suchas Clark, Fina, and Ashland.

Loading Port

Dos Bocas (Caribbean). 18.37 N. 93.10 W. The Dos Bocas terminal, located on the south-ern shore of the Gulf of Campeche in Tabasco state, consists of two single-buoy moor-ings designed for loading tankers from 150,000-250,000 deadweight tons. A total of 10crude oil tanks provide 5-million barrels of storage capacity.


OLMECA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.1 Sulfur Content % Weight 0.72Barrels /Metric Ton 7.596 Pour Point Temp. F. -20Viscosity Centistokes 2.9(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. Properties Unit ValueLPG 2.5 LPGLight Naphtha 55-175 7.1 Light Naphtha





Gas Oil 500-650 16.8 Gas OilSulfur Content % Wt. 0.69Cloud Point Temp. F 22Cetane Index 51



OLMECA TERM-CONTRACT PRICES TO THE US, 1988-93

Prices At Port Of Loading In Dollars Per BarrelMonth 1988 1989 1990 1991 1992 1993Jan. ... $16.80 $20.78 $23.45 $17.77 $17.92 Feb. ... 16.80 20.21 18.46 17.98 19.04March ... 18.76 19.51 18.56 17.76 19.18April ... 20.62 16.59 19.56 19.19 19.14May ... 19.65 16.42 19.66 20.14 18.94June 15.56 19.10 14.93 18.88 21.42 17.81July 14.98 18.47 17.13 20.03 20.61 16.68Aug. 14.80 17.38 27.13 20.51 20.10 16.76Sept. 13.76 18.11 34.57 21.01 20.53 16.30Oct. 12.59 18.66 35.38 22.30 20.43 16.73Nov. 12.90 18.82 32.51 21.09 19.65 15.04Dec. 15.24 20.13 27.28 18.49 18.48 13.49Note: More recent prices can be found in Chapter I.


HOUT Neutral Zone

Gravity: 32.8 Sulfur: 1.9 Loading Port: Ras al-Khafji

Production

Output averages 30,000 barrels a day from offshore fields in the Neutral Zone jointly heldby Saudi Arabia and Kuwait.

Quality

Although originally similar to Saudi benchmark grade Arabian Light, the grade hasbecome heavier over the years, and is now more like Arabian Medium.

Producers

Japan�s Arabian Oil Co. is the producer under concession agreements with the govern-ments of Kuwait and Saudi Arabia that date from 1957 and begin to expire in 1999.


All of the production is exported to customers in the Asia-Pacific region by AOC underprices determined by Saudi Arabia and Kuwait. As with Asian sales of Saudi and Kuwaiticrude oil, the price is tied by a formula to the average of the monthly spot prices forOman and Dubai grades. The formula is tied to the term contract price of Arabian Lightless a discount.

Sellers

The grade is sold by AOC, with government revenue divided equally between SaudiArabia and Kuwait.

Arabian Oil Co. Ltd.: Crude Oil Marketing Dept., 3-2-3 Marunouchi Chiyoda-Ku,P.O. Box 1679, Tokyo Central Post Office, Tokyo, Japan. Tel.: (81-33) 214-4319, Fax: (81-33) 214-7019.

Main Customers

Most of the grade is sold to Japanese National Oil Co., which uses the oil in the coun-try�s strategic stockpile, as well as Japanese refiners. Other volumes also go to Taiwan�sstate CPC.

Loading Port

Ras al-Khafji. 28.25 N. 48.32 E. The port is located in the offshore area of the Dividedor Neutral Zone of Saudi Arabia and Kuwait. Two four-buoy system berths and two sin-gle-buoy mooring system berths are available for loading tankers up to ultra-large crudecarrier size.


HOUT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.8 Sulfur Content % Volume 1.9Barrels /Metric Ton 7.32 Pour Point Temp. C -25Viscosity Centistokes 9.88 Reid Vapor Press. Lbs/Sq. In. 4.6(Kinematic) at 30 C Hydrogen Sulfide ppm 1



<212 Octane RON Clear Octane 60.1Heavy Naphtha 100-170 11.7 10.2 Heavy Naphtha



Freezing Point Temp. C -46.5Light Gas Oil 250-310 9.9 9.6 Light Gas Oil

482-590 Sulfur Content % Wt. 0.85Pour Point Temp. C -15Cetane Index 56


Pour Point Temp. C 5Cetane Index 58Viscosity (Kin) Cen at 50 C 4.65





KHAFJI Neutral Zone

Gravity: 28.5 Sulfur: 2.85 Loading Port: Ras al-Khafji

Production

Khafji is the single-largest Neutral Zone field, producing 280,000 barrels a day in 1996from an offshore complex that is a northern extension of the large Saudi Safaniyah struc-ture. Output levels can be influenced by Opec quota agreements and higher winterdemand from Japanese refiners. Capacity is expected to be expanded slightly as part ofan investment program that is meant primarily to sustain current flows well into the nextcentury.

Quality

The grade is very similar to Arabian Heavy. The test below is old, but it is still consid-ered representative of the crude oil�s quality.

Producers

Japan�s Arabian Oil Co. is the producer under concession agreements with the govern-ments of Kuwait and Saudi Arabia that date from 1957 and begin to expire in 1999.


Sales are exclusively to the Far East, with over two-thirds sold to Japanese refiners. Thebalance of sales are taken by other Asia-Pacific refiners. Over 90% of crude oil sales areon a term-contract basis. Khafji is priced at parity with the Saudi formula terms for ArabHeavy to the Far East.

Sellers

The grade is sold by AOC, with government revenue divided equally between SaudiArabia and Kuwait.

Arabian Oil Co. Ltd.: Crude Oil Marketing Dept., 3-2-3 Marunouchi Chiyoda-Ku,P.O. Box 1679, Tokyo Central Post Office, Tokyo, Japan. Tel.: (81-33) 214-4319, Fax: (81-33) 214-7019.

Loading Port

Ras al-Khafji. 28.25 N. 48.32 E. The port is located in the offshore area of the Dividedor Neutral Zone of Saudi Arabia and Kuwait. Two four-buoy system berths and two sin-gle-buoy mooring system berths are available for loading tankers up to ultra-large crudecarrier size.


KHAFJI ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 28.5 Sulfur Content % Volume 2.85Barrels /Metric Ton 7.128 Pour Point Temp. C <-30Viscosity Centistokes 56.7 Reid Vapor Press. Lbs/Sq. In. 7.6(Kinematic) at 50 F/10 C Hydrogen Sulfide ppm <1


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLight Naphtha <100 8 6.19 Light Naphtha

<212 Octane RON Clear Octane 60.6Heavy Naphtha 100-170 9.4 7.9 Heavy Naphtha



Freezing Point Temp. C -47.5Light Gas Oil 250-310 9.2 8.82 Light Gas Oil

482-590 Sulfur Content % Wt. 1.18Pour Point Temp. C -17.5Cetane Index 53.4


Pour Point Temp. C 0Cetane Index 54.4Viscosity (Kin) Cen at 50 C 4.54




KHAFJI TERM -CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $12.03 $12.53 $27.20 $35.20 $31.03 $31.03 $26.03 $26.53 Feb. 12.03 13.73 27.20 35.20 31.03 27.03 26.03 26.53March 12.03 15.32 27.20 35.20 31.03 26.03 26.03 26.53April 12.03 15.46 27.20 35.20 31.03 26.03 26.03 26.53May 12.03 16.06 29.20 35.20 31.03 26.03 26.03 26.53June 12.03 18.66 29.20 35.20 31.03 26.03 26.03 26.53July 12.03 19.19 31.20 35.20 31.03 26.03 26.03 26.03Aug. 12.03 19.19 31.20 35.20 31.03 26.03 26.03 26.03Sept. 12.03 19.19 31.20 35.20 31.03 26.03 26.03 26.03Oct. 12.03 23.50 31.20 35.20 31.03 26.03 26.03 26.03Nov. 12.03 25.20 31.20 31.65 31.03 26.03 26.03 26.03Dec. 12.03 27.50 31.20 31.65 31.03 26.03 26.03 26.03Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. ... ... $16.27 $13.43 $16.65 $16.43 $12.87 $13.19 Feb. ... 16.27 16.27 13.63 16.03 ... 13.33 13.77March ... 16.27 12.59 15.18 15.00 ... 13.38 14.08April ... 16.27 14.10 16.33 13.30 ... 14.55 14.28May ... 16.27 14.08 15.13 13.58 ... 15.70 13.94June ... 16.27 12.93 14.80 12.26 13.29 17.07 13.57July ... 16.27 12.15 14.83 13.80 14.13 16.52 12.34Aug. ... 16.27 12.28 14.30 23.54 14.51 15.89 12.58Sept. ... 16.27 10.73 14.93 29.46 15.69 16.45 12.13Oct. ... 16.27 9.43 15.48 29.97 16.66 16.46 12.88Nov. ... 16.27 9.75 15.33 25.26 15.82 15.38 11.89Dec. ... 16.27 11.73 16.40 20.52 12.70 14.38 10.22Note: Production was shut-in during early 1991 due to the liberation of Kuwait. In 1986 and early 1987, netback pricing pre-vailed, for which no data are available. Note: More recent prices can be found in Chapter I.


WAFRA Neutral Zone

Gravity: 24.2 Sulfur: 4.0 Loading Port: Mina Saud (Mina al-Zour)Other Names: Ratawi

Production

The onshore block in the northern part of the Neutral Zone produces about 200,000 bar-rels a day from three fields, with Wafra itself being the largest. The production facilitiesat the fields and the adjacent refinery were heavily damaged during the Iraqi occupationof Kuwait, but capacity has been fully restored and an aggressive expansion program isunder way. Targets are to raise capacity to 300,000 b/d by 1999, 400,000 b/d by 2003,and 500,000 b/d by 2005, all of which will be heavy crude oil. This includes flows ofheavier, 18-gravity Eocene grade.

Quality

A heavy, high-sulfur crude oil, even by Mideast standards, but relatively low in metals,asphaltenes, and acidity for a crude oil that is this heavy. The main export grade hasbeen Wafra or Ratawi, but a heavier 18-gravity grade came on in 1996 and is making animportant contribution to higher output. The heavier Eocene grade comes from a differ-ent producing layer of the field.

Producer

A 50-50 joint venture between Texaco and state Kuwait Oil Co. in which Texaco is theoperator. As with the other Neutral Zone crude oils, Saudi Arabia and Kuwait split rev-enues from the crude oil 50-50. The concession is due to expire in 2010.


The grade is difficult to market because of its quality, which tends to restrict it to moresophisticated refineries. Wafra rarely appears in the open market, but Texaco is makinggreater efforts to market the rising production, which it refers to as Ratawi and Eocene.It has been lining up term contract customers for monthly liftings on either an f.o.b. ordelivered basis. Significant volumes are also absorbed in Kuwait�s large domestic refiner-ies, which are capable of handling such grades, and in Texaco�s downstream network.About 45,000 b/d moved to Japan in 1995.

Sellers

Texaco International Trader: 2000 Westchester Ave., White Plains, NY 10650. Tel.:(914) 253-4000, Fax: (914) 253-7178.

Kuwait Petroleum Corp.: P.O. Box 26565, Safat, Kuwait 13126. Tel.: (965) 245-5455,Fax: (965) 246-7159.

KPC London: 80 New Bond St., London W1Y 9DA, UK. Tel.: (44-171) 491-4000, Fax:(44-171) 629-2617.

Loading Port

Mina Saud. 28.45 N. 48.24 E. The port is located just south of Ras Az Zaur. The termi-nal is connected by pipelines to the field and production center at Wafra, 31 miles to thenorthwest. There are two loading berths. Each is a conventional multi-buoy mooringcapable of handling VLCCs.


WAFRA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 24.2 Sulfur Content % Weight 4Barrels /Metric Ton 6.93 Pour Point Temp. F -29Viscosity Centistokes 33 Reid Vapor Press. Lbs/Sq. In. 5.3(Kinematic) at 40C Hydrogen Sulfide Parts/mill. 4



Octane RON clear 62Int. Naphtha 200-350 10.1 8.4 Intermediate Naphtha

Paraffins % Wt. 68.6Naphthenes % Wt. 19.4Aromatics % Wt. 12

Kerosine 350-500 11.7 10.5 KerosineSulfur Content % Wt. 0.75Freezing Point Temp. C -40


Vacuum Gas Oil 650-1000 25.4 26 Vacuum Gas OilSulfur Content % Wt. 3.69Pour Point Temp. F 85Aniline Point Temp. F 165Viscosity (Kin) 50C 28.8

Residue >1000 32.1 37.4 ResidueSulfur Content % Wt. 6.29Viscosity (Kin) Cen at 50C 849298Asphaltenes % Wt. 13.6Vanadium Parts/mill. 121.1



BONNY LIGHT Nigeria

Gravity: 35.4 Sulfur: 0.14 Loading Port: BonnyOther Names: Nigerian Light, BBQ (acronym for similar-quality Nigerian crude oils:Bonny Light, Brass River, and Qua Iboe)

Production

About 450,000-500,000 barrels a day, mainly from many small fields onshore on the eastside of the Niger delta.

Quality

Nigeria�s benchmark grade. A high-quality, light, sweet crude oil that is particularly val-ued for making gasoline.

Producers

Produced mainly by a joint venture operated by Shell (30%) with state NNPC (55%), Agip(5%), and Elf (10%). Some production comes from a smaller joint venture operated byChevron (40%) with NNPC (60%).


The primary market for Bonny Light is the US, which takes about half of Nigeria�s totalcrude oil exports of 1.6-million b/d. Volumes also move regularly to Europe and occa-sionally to the Far East. State NNPC sells to a wide and variable range of term-contractcustomers that include both traders and refiners. The price formulas for all Nigeriancrude oils are tied to the spot market prices of UK Brent Blend. NNPC also offersdeferred pricing with an extra premium. Bonny Light is one of the most actively spot-traded West African streams, especially in the summer, when its high gasoline yieldmakes it particularly attractive to the US market.

Sellers

NNPC is the main seller, but it also uses about 125,000 b/d as feedstock for its domesticrefineries, leaving only about 325,000 b/d for export. Among equity producers, Shell ismore active as a reseller of the crude oil, while Elf and Agip are more prone to usingtheir shares within their own international downstream systems.

NNPC: General Manager, Crude Oil Marketing Division, 7 Kofo Abayomi St., VictoriaIsland, PMB 12701, Lagos, Nigeria. Tel.: (234-1) 614-228, Telex: 21609 NG.

Shell International Trading And Shipping Co. (Stasco): Shell Mex House, Strand,London, WC2R O7A, UK. Tel.: (44-171) 546-1234, Fax: (44-171) 546-4448.

Agip Spa: 89-91 Via Del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-921, Fax: (39-6)503-922-41.

Elf Trading S.A.: P.O. Box 532, 1215 Geneva 15 Airport, Switzerland. Tel.: (41-22)710-1112, Fax: (41-22) 710-1110.

Loading Port

Bonny Offshore Terminal. 04.11 N. 07.14 E. The Bonny loading facility consists of anoffshore terminal with two single-buoy moorings. Size restrictions are a maximum320,000 deadweight tons.


BONNY LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.4 Sulfur Content % Weight 0.14Barrels /Metric Ton 7.426 Pour Point Temp. C 12Viscosity Centistokes 3.34 Reid Vapor Press. Lbs/Sq. In. 4.3(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 2.1 1.4 LPGLight Naphtha <85 7.7 6.2 Light Naphtha











BONNY LIGHT TERM-CONTRACT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $25.10 $17.45 $15.75 $17.14 $20.54 $21.40 $18.53 $17.94 Feb. 18.00 18.92 15.08 17.96 19.42 19.47 18.37 19.00March 16.90 18.92 14.67 19.62 17.56 19.09 17.94 19.22April 14.95 18.92 16.71 19.59 16.45 19.50 19.43 19.24May 16.15 18.92 16.40 18.26 15.85 19.38 20.47 18.85June 12.75 18.92 15.49 17.25 15.75 18.46 21.64 17.75July 10.20 18.92 15.71 16.90 21.82 19.70 20.74 17.24Aug. 13.65 18.92 15.02 17.45 30.50 20.13 20.32 17.28Sept. 13.35 18.92 13.98 18.53 38.34 20.84 20.85 16.51Oct. 13.35 18.92 13.76 18.90 34.36 22.56 20.57 16.69Nov. 14.00 18.92 14.78 19.40 31.36 21.41 19.53 15.23Dec. 14.30 18.92 15.46 21.59 27.83 18.72 18.57 14.03

BONNY LIGHT SPOT PRICES, 1987-93Month 1987 1988 1989 1990 1991 1992 1993Jan. $18.45 $16.95 $17.35 $21.65 $24.20 $18.60 $17.80 Feb. 17.55 15.90 17.15 20.20 20.30 18.55 19.10March 18.05 14.85 19.05 18.70 19.45 18.10 19.40April 18.35 16.75 20.55 16.85 19.30 19.60 19.25May 18.80 16.50 18.95 16.70 19.45 20.60 19.05June 18.95 15.65 17.90 15.40 18.50 21.80 18.10July 19.95 15.10 17.95 17.55 19.90 20.95 17.50Aug. 19.00 15.10 16.90 28.00 20.20 20.40 17.20Sept. 18.50 13.40 17.95 35.90 21.10 20.85 16.50Oct. 19.00 12.55 19.20 36.80 22.80 20.90 17.05Nov. 18.10 13.15 19.15 33.90 21.85 19.90 15.75Dec. 17.15 15.45 20.25 28.75 18.90 18.70 14.05Note: More recent prices can be found in Chapter I.


BONNY MEDIUM Nigeria

Gravity: 26.5 Sulfur: 0.22 Loading Port: BonnyOther Names: Nigerian Medium

Production

About 80,000 barrels a day from many small fields on the east side of the Niger delta.

Quality

A heavier, low-sulfur Nigerian grade that is especially rich in middle distillates.

Producers

Produced mainly by a joint venture operated by Shell (30%) with state NNPC (55%), Agip(5%), and Elf (10%). Some production comes from a smaller joint venture operated byElf (40%) with NNPC (60%).


Prized as a gas oil grade, Bonny Medium is readily absorbed into the US and Europeanmarkets, particularly in winter. State NNPC sells to a wide and variable range of term-contract customers that include both traders and refiners. The price formulas for allNigerian crude oils are tied to the spot market prices of UK Brent Blend. NNPC alsooffers deferred pricing with an extra premium. Bonny Medium is rarely traded in the spotmarket except in the winter months. The crude oil is usually �sandwiched� with BonnyLight in the same cargo, due to limitations of the loading facility.

Sellers

NNPC is the main seller, and virtually all of production is exported. The equity produc-ers tend to use their shares in their international downstream systems.





Loading Port

Bonny Offshore Terminal: 04.11 N. 07.14 E. Bonny Medium is loaded in combinedcargoes with Bonny Light due to the storage and handling limitations of the terminal. TheBonny loading facility consists of an offshore terminal with two single-buoy moorings.Size restrictions are a maximum 320,000 deadweight tons. The inshore terminal is nolonger used for crude oil loading.


BONNY MEDIUM ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 26.5 Sulfur Content % Weight 0.22Barrels /Metric Ton 7.032 Pour Point Temp. C <-30Viscosity Centistokes 9.06 Reid Vapor Press. Lbs/Sq. In. 4.3(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1







455-572 Sulfur Content % Wt. 0.11Cloud Point Temp. C <-30Cetane Index 36




Pour Point Temp. C/F 30/86Viscosity (Kin) Cen at 60 C 142Asphaltenes % Wt. 0.05Conradson Carbon R % Wt. 4.14Vanadium Parts/mill. 4


BONNY MEDIUM TERM CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.68 $14.25 $28.72 $38.72 $33.77 $33.52 $28.02 $27.02 Feb. 13.68 14.25 32.93 38.72 33.77 28.02 28.02 27.62March 13.68 14.25 32.93 38.72 33.52 28.02 28.02 27.62April 13.57 17.52 33.44 38.72 33.52 28.02 28.02 27.62May 13.57 20.02 35.44 38.72 33.52 28.02 28.02 27.62June 13.57 20.02 35.44 38.72 33.52 28.02 28.02 27.62July 13.57 22.02 35.75 38.72 33.52 28.02 28.02 27.62Aug. 13.57 22.02 35.75 34.72 33.52 28.02 28.02 27.62Sept. 13.57 22.02 35.75 34.72 33.52 28.02 28.02 27.62Oct. 13.57 22.02 35.75 33.22 33.52 28.02 27.02 27.62Nov. 13.57 24.79 35.75 35.22 33.52 28.02 27.02 27.62Dec. 13.57 28.72 35.75 35.22 33.52 28.02 27.02 27.62Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $27.62 $18.25 ... ... $19.99 $20.50 $18.18 $17.19 Feb. 27.62 17.42 ... 17.16 18.87 18.77 17.57 18.45March 15.68 17.42 ... 18.82 17.01 18.24 17.04 18.82April ... 17.42 ... 18.79 15.70 18.50 18.78 18.77May 13.29 17.42 ... 17.46 15.10 18.23 19.72 18.55June ... 17.42 ... 16.46 15.00 17.31 20.89 17.60July ... 17.42 ... 15.90 20.92 18.70 20.04 16.82Aug. ... 17.42 ... 16.45 29.60 19.23 19.77 16.86Sept. ... 17.42 ... 17.53 37.64 20.34 20.45 16.31Oct. ... 17.42 ... 18.30 33.51 22.26 20.22 16.49Nov. 14.15 17.42 ... 18.80 30.56 21.06 19.28 15.03Dec. 15.50 17.42 ... 21.01 26.93 18.37 16.34 13.86Note: More recent prices can be found in Chapter I.


BRASS RIVER Nigeria

Gravity: 41.5 Sulfur: 0.09 Loading Port: Brass RiverOther Names: Brass Blend, BBQ (an acronym for three similar-quality Nigerian crudeoils: Bonny Light, Brass River, and Qua Iboe)

Production

About 150,000 barrels a day mainly from small onshore fields along the coast in the mid-dle of the Niger delta between the Bonny and Escravos systems.

Quality

Nigeria�s lightest export crude oil is a typical high-quality West African gasoline-orientedgrade.

Producers

Output by a joint venture operated by Agip (20%), with state NNPC (60%), and Phillips(20%). Ashland also has a smaller venture with NNPC split 40-60 that feeds into thisstream.


NNPC sells its share mainly on term contracts at prices slightly above Bonny Light andQua Iboe grades. The price formula is tied to the spot market prices of UK Brent Blend.Deferred pricing is available from NNPC for a premium. Brass River rarely appears in thespot market. The main customers are in the US due to the grade�s high gasoline yield.

Sellers

NNPC is the main seller, with both Agip and Phillips using the grade within their owndownstream systems.



Loading Port

Brass River Terminal. 04.04 N. 06.17 E. The Brass River Terminal, located 13.5 milesoff the South Nigerian coast, consists of two single-buoy moorings. Size restrictions are300,000 deadweight tons and 1,200 feet overall length.


BRASS RIVER ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity API 41.5 Sulfur Content % Weight 0.09Barrels /Metric Ton 7.771 Pour Point Temp. F 50Viscosity Centistokes 2.1(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. Properties Unit ValueLPG 2.7 LPGLight Naphtha <175 12.1 Light Naphtha





Atm. Gas Oil 500-650 15.3 Atmospheric Gas OilSulfur Content % Wt 0.09Cloud Point Temp. F 19Cetane Index 51

Residue >650 25.9 ResidueGravity API 18.8Sulfur Content % Wt. 0.24



ESCRAVOS Nigeria

Gravity: 36.2 Sulfur: 0.14 Loading Port: EscravosOther Names: Nigerian Light Gulf

Production

About 360,000 barrels a day, mostly from small fields on the west side of the Niger deltaand offshore.

Quality

A high-quality, light, low-sulfur crude oil similar to benchmark Bonny Light.

Producers

Equity ownership shared by state NNPC (60%) and Chevron (40%). Interest acquired byChevron in its takeover of Gulf Oil in 1984.


Exports amount to about 240,000 b/d, with NNPC selling only part of its share interna-tionally on term contracts and using about 120,000 b/d for domestic refining. Chevrongenerally keeps the grade within its own downstream system, but cargoes sometimesappear on the spot market. Prices are set by NNPC at a slight discount below the topNigerian grades. The price formula is tied to the spot market prices of UK Brent Blend.Deferred pricing is also available at a premium to the regular f.o.b formula.

Sellers


Chevron (UK) Ltd.: c/o Mail Centre, 2 Portman St., London W1H 0AN, UK. Tel.: (44-171) 487-8100, Fax: (44-171) 487-8142.

Loading Port

Escravos. 05.30 N. 05.00 E. The terminal consists of two single-buoy mooring berths.Sea Terminal Berth No. 2 handles vessels up to 120,000 deadweight tons and has a depthof 65 feet. Berth No. 3 takes ships up to 300,000 dwt at a depth of 100 ft.


ESCRAVOS ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.2 Sulfur Content % Weight 0.14Barrels /Metric Ton 7.46 Pour Point Temp. F 45Viscosity Centistokes 3.5(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 1.9 LPGLight Naphtha <175 6 Light Naphtha




Kerosine 400-500 12.8 KerosineSulfur Content % Wt 0.05Freezing Point Temp. F -38



Year Of Crude Oil Sample: 1987 Viscosity (Kin) Cen at 100 C 14


FORCADOS Nigeria

Gravity: 28.5 Sulfur: 0.19 Loading Port: ForcadosOther Names: Nigerian Export Blend

Production

About 450,000 barrels a day taken from many small onshore fields on the west side ofthe Niger Delta. Volume is about the same as Bonny Light, but less is used internally,making it Nigeria�s largest export crude oil stream.

Quality

Although heavier than the top-quality Nigerian grades, Forcados has an extremely largegas oil yield that makes it popular among refiners in the winter.

Producers

Produced mainly by a joint venture operated by Shell (30%) with state NNPC (55%), Agip(5%), and Elf (10%). Some production comes from a smaller joint venture operated byChevron (40%) with NNPC (60%).


Almost all production is exported. Under normal market conditions, NNPC sells its sharemainly on term contracts at prices tied to the spot market for UK Brent Blend. In thesummer, Forcados is generally priced by NNPC at about 20¢ a barrel below Bonny Light,but in the winter, it is often at a slight premium. This inversion is even more pronouncedin the spot market. The main destinations are Northwest Europe and the US. Forcados isone of the more actively spot traded West African streams, particularly in the autumn andthe winter, when its high gas oil yield is especially prized.

Sellers

NNPC is the main seller, but it also uses about 5,000-10,000 b/d as feedstock for domes-tic refineries. Among equity producers, Shell is more active as a reseller of the grade,while Elf and Agip are more prone to using their share within their own internationaldownstream systems.





Loading Port

Forcados. 05.10 N. 05.10 E. The Forcados single-buoy moorings are located approxi-mately 11 miles offshore. Crude oil is loaded through a 48-inch, 14-mile submarine line.Maximum vessel size is 320,000 deadweight tons with a maximum draft of 65 feet.


FORCADOS ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 28.5 Sulfur Content % Weight 0.19Barrels /Metric Ton 7.121 Pour Point Temp. C <-6Viscosity Centistokes 6.59 Reid Vapor Press. Lbs/Sq. In. 3.4(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1


Product Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 1 0.6Light Naphtha <85 3.4 2.7 Light Naphtha











FORCADOS TERM CONTRACT PRICES, 1986-93At Port Of Loading In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $28.07 $18.45 $15.47 $16.39 $20.54 $20.95 $18.48 $17.34 Feb. 18.00 18.52 14.54 17.66 19.42 19.12 17.82 18.66March 13.90 18.52 14.04 19.32 17.56 18.59 17.29 18.94April 12.65 18.52 16.14 19.29 16.15 18.80 19.03 18.92May 13.95 18.52 15.61 17.96 15.55 18.53 19.97 18.65June 11.65 18.52 14.66 16.96 15.45 17.61 21.14 17.75July 9.20 18.52 14.67 16.30 21.37 19.05 20.29 17.02Aug 13.50 18.52 14.31 16.85 30.05 19.53 20.02 17.06Sept. 14.05 18.52 13.26 17.93 38.19 20.69 20.70 16.56Oct. 13.95 18.52 12.85 18.88 34.16 22.51 20.47 16.74Nov. 14.50 18.52 14.08 19.38 31.06 21.36 19.48 15.29Dec. 15.85 18.52 15.17 21.58 27.38 18.72 17.01 14.11

FORCADOS SPOT PRICES, 1988-93Month 1988 1989 1990 1991 1992 1993Jan. $16.95 $17.30 $21.80 $23.75 $18.35 $17.45 Feb. 15.85 17.05 20.10 19.65 17.90 18.70March 14.80 18.90 18.35 18.80 17.70 19.15April 16.60 20.45 16.30 18.60 19.15 19.05May 16.30 18.75 16.20 18.70 20.15 19.00June 15.45 17.20 14.90 17.75 21.35 18.00July 14.90 17.20 17.10 19.30 20.75 17.30Aug. 14.90 16.65 27.45 19.95 20.25 17.20Sept. 13.30 17.95 35.80 21.00 20.70 16.55Oct. 12.45 19.25 36.30 22.80 20.90 17.15Nov. 13.05 19.05 33.00 21.90 19.80 15.80Dec. 15.35 20.35 28.10 18.85 18.30 14.10Note: More recent prices can be found in Chapter I.


QUA IBOE Nigeria

Gravity: 35.9 Sulfur: 0.12 Loading Port: Qua IboeOther Names: Nigerian Light Mobil, BBQ (an acronym for similar-quality Nigerian crudeoils: Bonny Light, Brass River, and Qua Iboe)

Production

About 340,000 barrels a day, from offshore fields near the Cameroon border in south-eastern Nigeria. The 18-field network pumps crude oil to the onshore storage terminal atQua Iboe.

Quality

A high-quality, gasoline-rich Nigerian export grade similar to or slightly better thanbenchmark Bonny Light.

Producers

Equity ownership shared by state NNPC (60%) and Mobil (40%). Both companies sellmost of their equity crude oil to third-party buyers.


Almost all of the production is exported to US and European refiners. Prices are set byNNPC at a differential to dated Brent, and they are adjusted on a monthly basis.Deferred pricing is available at a premium. Qua Iboe is also actively traded in the spotmarket. As a gasoline-oriented grade, Qua Iboe is coveted when Atlantic Basin gasolinedemand peaks during the summer. Sweet crude oil refiners in the US and Europe arethe main customers.

Sellers


Mobil: 3225 Gallows Road, Fairfax, VA 22037. Tel.: (703) 846-3000, Fax: (703) 846-4669.

Loading Port

Qua Iboe. 04.20 N. 07.59 E. The Qua Iboe terminal, located on the eastern side of theestuary of the Qua Iboe River, contains seven crude oil-storage tanks, each with 700,000-barrel capacity. Tanker-loading facilities consist of two single-point mooring berths about20 miles offshore. Maximum draft at both berths is 72 feet.


QUA IBOE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.9 Sulfur Content % Weight 0.12Barrels /Metric Ton 7.46 Pour Point Temp. F 55Viscosity Centistokes 3.3(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 2.2Light Naphtha <175 6.4 Light Naphtha




Kerosine 400-500 12 KerosineSulfur Content % Wt 0.05Freezing Point Temp. F -37





DRAUGEN Norway

Gravity: 39.8 Sulfur: 0.15 Loading Port: Draugen

Production

Output of about 130,000 barrels a day from a single platform in the Norwegian Sea�sHaltenbanken off central Norway, north of the North Sea. Draugen was the first field tobe developed in the Haltenbanken area.

Quality

Similar to light, sweet North Sea crude oils.

Producers

Operator Shell (21%) with BP (14%) and Statoil (20%), which also holds a 45% stake onbehalf of the government..


Prices are linked to North Sea Brent grade, usually selling at a premium. Since the crudeoil is loaded at the production facility into specially dedicated tankers, sales are mainlyrestricted to Northwest European destinations, with less scope for spot trading.

Sellers


Statoil: P.O. Box 300, N-4001 Stavanger, Norway. Tel.: (47-4) 808-080, Fax: (47-4)807-042.

Loading Ports

Draugen. About 64 N. 8 E. Draugen crude oil is loaded from the production platformby offshore buoys into dedicated tankers.


DRAUGEN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.8 Sulfur Content % Weight 0.15Barrels /Metric Ton 7.63 Pour Point Temp. C -27Viscosity cts 2.53 Reid Vapor Press. kpa 49(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 3.3 2.25 LPGLight Naphtha <100 17.2 14.4 Light Naphtha

Octane RON Clear Octane 64Int. Naphtha 100-150 11.1 10.2 Intermediate Naphtha



Gas Oil 250-370 35.5 36.4 Gas OilSulfur Content % Wt. 0.13Cloud Point Temp. C -9Cetane Index 46

Residue >370 27.4 30.9 ResidueSulfur Content % Wt. 0.38Pour Point Temp. C 36Viscosity (Kin) At 100 C 14.6Asphaltenes % Wt. 0.25Conradson Carbon R % Wt. 3.2Vanadium Parts/mill. 1.5



EKOFISK Norway

Gravity: 39.4 Sulfur: 0.19 Loading Port: Tees River (UK)

Production

Output of about 530,000 barrels a day in the central North Sea from the Ekofisk field itself(240,000 b/d) � the first in the North Sea � and several other nearby fields. These areCod, Edda, Eldfisk, Embla, West Ekofisk, Hod, Valhall, Tommeliten, Ula, Gyda, Albuskjell,and Tor. The phasing in of satellite fields has helped to maintain flows from this maturearea, which began output in 1971. With production of the reservoir, the seabed has sunk,requiring extensive retrofitting of the facilities and plans for a new Ekofisk platform. Thecrude oil is combined into a single stream at the Ekofisk hub and transported by the700,000 b/d Norpipe pipeline to Teesside, UK, for tanker loading and export.

Quality

A high-quality, light, low-sulfur North Sea crude oil.

Producers

Phillips is the operator with a 36.96% share of the main Ekofisk fields. Other significantpartners include Petrofina (30%), Agip (13.04%), Elf (7.594%), Norsk Hydro (6.7%), andTotal (3.54%), with several smaller shares divided among other firms. BP is the operatorof Ula (60,000 b/d) and Gyda (65,000 b/d), and Amoco is the operator of Valhall andHod (75,000 b/d).


Producing companies keep some of the grade for their internal refining systems, but mostof the rest is sold on a spot basis with few formal term contracts. Ekofisk usually sells ata slight premium to North Sea benchmark grade Brent due to its higher gasoline yield.

Sellers

Phillips Petroleum Co. E-A: Phillips Quadrant, 35 Guildford Road, Woking SurreyGU22 7QT, UK. Tel.: (44-483) 756-666, Fax: (44-483) 752-309.

Petrofina S.A.: Rue de l�Industrie 52 B-1040, Brussels, Belgium. Tel.: (32-2) 288-9111,Fax: (32-2) 288-3250.

Agip (UK) Ltd.: Southside, 105 Victoria St., London SW1E 6QU, UK. Tel.: (44-171)630-1400, Fax: (44-171) 630-6544.

Main Customers

Most of the grade is refined in Northwest Europe, but cargoes do sometimes move toNorth America. Ekofisk�s onshore loading allows greater flexibility for shipping than thatof Norway�s platform-loaded crude oils.

Loading Port

Tees River, Teesside, UK. 54.39 N. 01.08 W. The Tees River terminal, located onBritain�s east coast, is the loading point for crude oil pumped by pipeline from theEkofisk fields in the Norwegian sector of the North Sea. Approximately 25 berths areavailable for vessels from 1,000-150,000 deadweight tons.


EKOFISK ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.4 Sulfur Content % Weight 0.19Barrels /Metric Ton 7.62 Pour Point Temp. C 0Viscosity SUS 37.5 Reid Vapor Press. Lbs/Sq. In. 6.4

at 40 C Hydrogen Sulfide % Weight <0.0001REFINED PRODUCT BREAKDOWNS AND PROPERTIES

Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLight Naphtha <80 13 10.3 Light Naphtha


175-302 Paraffins % Wt. 48.1Naphthenes % Wt. 34.9Aromatics % Wt. 17



400-662 Sulfur Content % Wt. 0.11Cloud Point Temp. C -8Diesel Index 60.7


Cloud Point Temp. C 17Diesel Index 55.1Viscosity (SUS) At 40 C 62.9


Pour Point Temp. C/F 36/95Viscosity (SUS) At 50 C 85.6Asphaltenes % Wt. 0.5Conradson Carbon R % Wt. 5Vanadium Parts/mill. 4

Year Of Crude Oil Sample: 1995 Nickel Parts/mill. 5EKOFISK SPOT PRICES, 1985-93

At Port Of Loading In Dollars Per BarrelMonth 1985 1986 1987 1988 1989 1990 1991 1992 1993Jan. $26.80 $25.00 $18.40 $16.75 $17.20 $21.40 $23.80 $18.50 $17.55 Feb. 27.35 19.60 17.35 15.65 16.90 19.95 19.65 18.30 18.80March 28.05 13.60 17.90 14.70 18.80 18.50 19.15 17.80 19.00April 28.10 12.30 18.10 16.55 20.40 16.65 19.30 19.25 18.75May 27.35 14.25 18.65 16.40 18.85 16.55 19.45 20.25 18.55June 26.40 11.85 18.75 15.55 17.80 15.25 18.45 21.40 17.80July 26.60 9.45 19.75 15.05 17.80 17.40 19.80 20.45 17.10Aug. 27.10 13.60 18.85 14.85 16.80 27.30 20.15 19.90 17.05Sept. 27.70 14.20 18.30 13.30 17.85 35.25 20.95 20.30 16.20Oct. 27.90 13.80 18.65 12.45 19.00 36.30 22.60 20.45 16.65Nov. 28.80 14.55 17.75 13.00 18.65 32.95 21.55 19.35 15.20Dec. 28.60 15.75 17.05 15.35 19.70 28.05 18.55 18.40 13.65

EKOFISK �NORM PRICES,� 1985-93Month 1985 1986 1987 1988 1989 1990 1991 1992 1993Jan. $26.80 $25.60 $17.50 $16.75 $16.25 $21.25 $26.20 $18.40 $19.05 Feb. 27.35 19.05 18.25 16.20 17.05 20.55 21.30 18.65 18.30March 28.05 15.90 17.15 14.65 17.65 19.10 19.30 17.75 17.75April 27.40 12.95 18.45 15.60 19.75 17.55 19.05 18.75 18.75May 27.40 13.35 18.45 16.55 19.90 16.50 19.80 19.95 18.75June 27.40 13.25 18.45 16.55 18.20 15.85 18.85 21.10 18.05July 27.05 10.90 19.25 14.95 17.80 16.10 19.10 20.70 17.20Aug. 27.05 11.25 19.80 15.35 16.95 23.30 20.15 20.20 17.05Sept. 27.05 14.45 18.25 14.35 17.50 31.10 20.65 20.20 16.50Oct. 28.55 13.90 18.50 12.70 18.45 38.40 22.10 20.45 16.70Nov. 28.55 13.90 18.40 12.70 18.95 33.95 22.15 19.70 15.65Dec. 28.55 14.80 17.60 14.00 19.00 30.75 19.65 18.80 14.15�Norm prices� are tax-reference prices based on assessment of the average of all sales. Tax-reference prices for crude lifted during the month.Note: More recent prices can be found in Chapter I.


GULLFAKS Norway

Gravity: 29.9 Sulfur: 0.41 Loading Ports: Gullfaks, MongstadOther Names: Gullfaks A-B, Gullfaks C

Production

Output of about 460,000 barrels a day from three offshore production platforms � A, B,and C � in the northern part of the North Sea. Production began in 1986 from platformsA and B. Platform C came on stream in 1990, and smaller adjacent fields are being tiedinto the system.

Quality

Heavier-than-typical North Sea crude oil, but still low in sulfur and high in naphthenes,which gives it good gasoline-manufacturing characteristics despite its density. The crudeoil from the C platform is lighter, at 35.5 degrees API gravity, and more paraffinic thanthe crude oil produced from platforms A and B, and has been sold as a higher value sep-arate stream since late 1993. The test below is from platforms A & B.

Producers

Operator Statoil (12%) with Norsk Hydro (9%) and Saga (6%), with the 73% state shareheld on behalf of the government by Statoil.


Prices are linked to North Sea Brent grade, usually selling at a discount. Since the crudeoil is loaded at the production facility into specially dedicated tankers, sales are mainlyrestricted to Northwest European destinations, with less scope for spot trading. However,Gullfaks crude oil can be transshipped to Statoil�s onshore Mongstad terminal for salesto more distant markets in larger ships.

Sellers


Statoil UK Ltd.: 10 Piccadilly, Swan Gardens, London W1V 9LA, UK. Tel.: (44-171)491-1555, Fax: (44-171) 491-1589.

Statoil North America: 225 High Ridge Road, Stamford, CT 06905, USA. Tel.: (203)978-6900.

Loading Ports

Gullfaks. 61.12 N. 2.12 E. Gullfaks crude oil is loaded from the main production plat-forms by offshore buoys into dedicated tankers with cargo sizes between 110,000-130,000 deadweight tons.Mongstad. 69.49 N. 05.02 E. Located on the west coast of Norway, the terminal accom-modates tankers up to 300,000 dwt tons. The draft limitation at Berth No. 1, the crudeoil-loading berth, is 72 feet.


GULLFAKS ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 29.9 Sulfur Content % Weight 0.41Barrels /Metric Ton 7.19 Pour Point Temp. C <-51Viscosity Centistokes 15 Reid Vapor Press. kPa 25.6(Kinematic) at 20 C Hydrogen Sulfide Parts/mill. nil





Heavy Naphtha 150-180 5.26 4.82 Heavy NaphthaParaffins % Wt. 31.1Naphthenes % Wt. 43.1Aromatics % Wt. 25.8

Kerosine 180-240 11.08 10.53 KerosineSulfur Content % Wt. <0.03Freezing Point Temp. C <-60

Light Gas Oil 240-320 17.36 17.27 Light Gas OilSulfur Content % Wt. 0.15Cloud Point Temp. C -54Cetane Index 43.1

Int. Gas Oil 320-375 10.27 10.49 Intermediate Gas OilSulfur Content % Wt. 0.45Cloud Point Temp. C -14Cetane Index 45.2Viscosity (Kin) Cen at 50 C 7.49

Residue >375 41.65 44.81 ResidueSulfur Content % Wt. 0.74Pour Point Temp. C 0Viscosity (Kin) Cen at 50 C 284Asphaltenes % Wt. <0.5Conradson Carbon R % Wt. 3.7Vanadium Parts/mill. 4.3


GULLFAKS �NORM PRICES,� 1988-93

At Port Of Loading In Dollars Per BarrelMonth 1988 1989 1990 1991 1992 1993Jan. $16.55 $16.00 $21.25 $26.20 $18.00 $17.50 Feb. 16.00 16.80 20.40 21.15 18.30 17.95March 14.35 17.35 18.85 18.80 17.25 18.75April 15.30 19.45 17.25 18.25 18.20 18.55May 16.15 19.50 16.10 18.95 19.45 18.45June 16.15 17.80 15.40 18.00 20.70 17.80July 14.50 17.35 15.75 18.35 20.40 16.90Aug. 14.90 16.65 22.85 19.45 19.95 16.70Sept. 13.95 17.30 31.10 20.25 20.05 16.15Oct. 12.35 18.20 38.05 21.75 20.30 16.50Nov. 12.35 18.80 33.65 21.85 19.55 15.55Dec. 13.65 18.95 30.55 19.30 18.60 14.10

�Norm prices� are tax-reference prices for crude lifted during the month. Prices for July1993 onward are for Gullfaks A & B. Gullfaks C prices were 5¢-10¢ a barrel higher. Note:More recent prices can be found in Chapter I.


HEIDRUN Norway

Gravity: 28.6 Sulfur: 0.46 Loading Port: Heidrun

Production

Output of about 230,000 barrels a day from a single platform in the Norwegian Sea�sHaltenbanken off central Norway, north of the North Sea.

Quality

Heavier and higher in sulfur than most Norwegian crude oils, Heidrun also has high acidcontent, which makes it hard to handle for most refiners. This tends to restrict its poten-tial customers, and has resulted in a large share of output moving to sophisticated refin-ers in North America.

Producers

The field was developed by Conoco (18%) and is operated by Statoil (10%), which alsoholds the government�s dominant 65% interest. Other partners are Neste (5%) and NorskHydro.


Prices are linked to North Sea Brent grade and to US West Texas Intermediate. Althoughunusual for Norway, the WTI pricing helps sell the crude oil to North America.

Term-contract customers include Ultramar�s Quebec refinery and Amoco in the US.Conoco plans to take its full 40,000 b/d equity stake into its UK refinery.

Sellers




Loading Ports

Heidrun. About 65 N. 8 E. Heidrun crude oil is loaded at the platform into dedicatedtankers.


HEIDRUN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 28.6 Sulfur Content % Weight 0.46Barrels /Metric Ton 7.13 Pour Point Temp. C -48Viscosity Centistokes 15.6 Reid Vapor Press. kPa 39.9(Kinematic) at 20 C Total Acid mg KOH/g 2.71






Kerosine 180-240 11.63 10.98 KerosineSulfur Content % Wt. 0.02Freezing Point Temp. C <-60

Light Gas Oil 240-320 20.24 20.14 Light Gas OilSulfur Content % Wt. 0.13Cloud Point Temp. C -32Cetane Index 40


Residue >375 38.48 41.69 ResidueSulfur Content % Wt. 0.92Pour Point Temp. C 9Viscosity (Kin) Cen at 50 C 504Asphaltenes % Wt. 0.92Conradson Carbon R % Wt. 5.03Vanadium Parts/mill. 21



OSEBERG Norway

Gravity: 36.3 Sulfur: 0.29 Loading Port: StureOther Names: Oseberg Blend

Production

Offshore output of about 700,000 barrels a day is a blend of around 495,000 b/d fromthe Oseberg field, 130,000 b/d from Brage and the 75,000 b/d Veslefrikk field in theNorth Sea. Production began in 1988. The crude oil is transported by a 700,000 b/dpipeline to the Norwegian coast for loading.

Quality

A light, low-sulfur North Sea crude oil similar in quality to Brent.

Producers

Oseberg itself is produced by operator Norsk Hydro (13.75%) and Statoil (14.04%), Saga(8.61%), Elf (5.6%), Mobil (4.2%), and Total (2.8%), with the 51% state share held onbehalf of the government by Statoil. Veslefrikk is produced by operator Statoil (18%),Total (18%), Deminex (13.5%), Norsk Hydro (9%), and Svenska (4.5%), with the 37% stateshare held on behalf of the government by Statoil. Brage is operated by Norsk Hydro(13.2%) with other partners including Neste (13.2%), Exxon (17.6%), and Statoil (56%).


The grade is sold on both a spot and term-contract basis. Prices are linked to North SeaBrent grade, usually selling at a slight premium. Since the grade is piped to the deep-water terminal at Sture on the Norwegian coast, it can be shipped relatively easily out-side of its natural market in Northwest Europe, with the US and Mediterranean often pro-viding outlets.

Sellers




Norsk Hydro: P.O. Box 220, N-1321 Stabekk, Norway. Tel.: (47) 22-73-8100, Fax:(47) 22-73-9040.

Loading Port

Sture. 60.37 N. 4.51 E. The terminal lies north of Bergen on the west coast of Norway,and it has 5-million barrels of crude oil storage with loading capacity of 700,000 b/d anda maximum vessel size of 300,000 deadweight tons.


OSEBERG ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.3 Sulfur Content % Weight 0.29Barrels /Metric Ton 7.47 Pour Point Temp. C -6Viscosity Centistokes 6.76 Reid Vapor Press. kPa 65.5(Kinematic) at 20 C Total Acid mg KOH/g 0.17








Int. Gas Oil 320-375 9.45 9.91 Intermediate Gas OilSulfur Content % Wt. 0.31Cloud Point Temp. C 8Cetane Index 48.7Viscosity (Kin) Cen at 50 C 6.79

Residue >375 33.91 38.09 ResidueSulfur Content % Wt. 0.64Pour Point Temp. C 45Viscosity (Kin) Cen at 80 C 58Asphaltenes % Wt. 1.1Conradson Carbon R % Wt. 5.2Vanadium Parts/mill. 3.4


OSEBERG �NORM PRICES,� 1989-93

At Port Of Loading In Dollars Per BarrelMonth 1989 1990 1991 1992 1993Jan. $16.20 $21.45 $26.40 $18.25 $17.75 Feb. 17.00 20.55 21.35 18.55 18.20March 17.55 19.05 19.15 17.50 18.90April 19.65 17.40 18.55 18.40 18.60May 19.75 16.30 19.30 19.60 18.60June 18.00 15.60 18.40 20.80 17.95July 17.60 15.85 18.70 20.55 17.05Aug. 16.85 23.15 19.75 20.15 16.85Sept. 17.45 31.25 20.35 20.10 16.30Oct. 18.40 38.20 21.90 20.45 16.60Nov. 19.00 33.85 22.05 19.75 15.60Dec. 19.15 30.75 19.60 18.75 14.15

�Norm prices� are tax-reference prices for all crude lifted during the month.Note: More recent prices can be found in Chapter I.


SLEIPNER CONDENSATE Norway

Gravity: 59 Sulfur: 0.016 Loading Port: Karsto

Production

Some 110,000 barrels a day were being produced from the Sleipner East field in 1996,with volumes expected to rise in 1997 with the start-up of Sleipner West. The conden-sate is transported by a 200,000 b/d pipeline to Karsto, where LPG is removed and it isstabilized for export. Production began in late 1993.

Quality

An extremely light condensate produced in association with natural gas. The stream isparticularly good for making gasoline.

Producers

Operator Statoil (20%) with Exxon (30%), Norsk Hydro (10%), Elf (9%), and Total (1%),with the 26.9% state share held on behalf of the government by Statoil.


Prices are linked to North Sea Brent grade, but growing volumes of condensate produc-tion in the Atlantic Basin have made it harder for the stream to obtain much of a pre-mium. Most sales are to refiners in Europe.

Sellers




Loading Port

Karsto. 59.17 N. 5.33 E. The port, which also handles gas liquids from other North Seafields, was expanded to handle Sleipner condensate. Typical cargoes are 40,000 dead-weight tons.


SLEIPNER CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 59 Sulfur Content % Weight 0.016Barrels /Metric Ton 8.5 Pour Point Temp. C -42Viscosity Centistokes 0.79 Reid Vapor Press. kPa 62.8(Kinematic) at 20 C Total Acid mg KOH/g 0.01









Year Of Crude Oil Sample: 1993 Pour Point Temp. C 27


STATFJORD Norway

Gravity: 38.7 Sulfur: 0.24 Loading Ports: Statfjord, Mongstad

Production

About 550,000 barrels a day comes from the Statfjord field, which came on stream in1979 and is on the UK-Norway border in the North Sea. Output is divided between thetwo countries on an 85.24%-14.76% split in Norway�s favor. Statfjord is the largest pro-ducing field in the North Sea, and it is supplemented by about 200,000 b/d fromNorway�s Snorre field, which came on stream in 1992. Total flows are thus around750,000 b/d, of which about 660,000 b/d is Norwegian and the remainder British.

Quality

Similar to North Sea benchmark Brent Blend. A light, low-sulfur, paraffinic crude oil.Refiners consider Statfjord an excellent grade for making premium unleaded gasolineand sweet vacuum gas oil for cracking. The addition of the Snorre production to thestream did not affect the quality of the grade.

Producers

A large group of companies have ownership stakes in the Statfjord field, althoughNorway�s Statoil is the operator and largest holder with 42.6%. Other equity stakesbelong to Conoco (14%), Mobil (13.5%), Shell and Exxon (8.5% each), Chevron andBritish Petroleum (4.9% each), Saga (1.9%), and others. The Snorre field is operated bySaga (11%) with Exxon, Deminex, Statoil, and Idemitsu all at about 10%, in addition toseveral other smaller equity holders. The state�s 31.4% share of Snorre is held by Statoilon behalf of the government.


Statfjord is marketed mainly in Northwest Europe because the crude oil is loaded off-shore from dedicated tankers. The grade also occasionally makes its way to the US Eastand Gulf coasts. It can be transshipped to the Mongstad terminal and loaded onto othertankers for longer voyages outside of Europe. It is actively traded at a premium to datedBrent. Term contracts make up most of Statfjord sales, with relatively little spot trading.

Key Sellers




Conoco Ltd.: Conoco House, Black Friars Road, London, UK. Tel.: (44-171) 408-6000, Fax: (44-171) 408-6969.

Loading Ports

Statfjord. 61.15 N. 1.51 E. Crude oil from the Statfjord system is loaded from offshorebuoys to dedicated tankers between 110,000-130,000 deadweight tons.Mongstad. 69.49 N. 05.02 E. Located on the west coast of Norway, the terminal accom-modates tankers up to 300,000 dwt. The draft limitation at Berth No. 1, the crude oil-loading berth, is 72 feet.


STATFJORD ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 38.7 Sulfur Content % Weight 0.24Barrels /Metric Ton 7.58 Pour Point Temp. C -6Viscosity Centistokes 5.63 Reid Vapor Press. kPa 60.6(Kinematic) at 20 C Total Acid mg KOH/g 0.04


Product Temp. C % Vol. % Wt. Properties Unit ValueLPG 4.27Light Naphtha <90 8.7 7.17 Light Naphtha




Kerosine 180-240 10.91 10.67 KerosineSulfur Content % Wt. 0.01Freezing Point Temp. C -47.5

Light Gas Oil 240-320 15.7 16.02 Light Gas OilSulfur Content % Wt. 0.09Cloud Point Temp. C -18Cetane Index 51


Residue >375 4.64 4.98 ResidueSulfur Content % Wt. 0.34Pour Point Temp. C 30Viscosity (Kin) Cen at 50 C 16.2Conradson Carbon R % Wt. <0.01Vanadium Parts/mill. <0.1

Year Of Crude Oil Sample: 1994 Nickel Parts/mill. <0.1STATFJORD TERM-CONTRACT AND SPOT PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.75 $15.85 $32.50 $39.80 $36.70 $33.60 $29.60 $26.60 Feb. 13.75 15.85 34.50 39.80 35.20 30.15 29.60 27.15March 13.75 15.85 34.50 39.80 31.10 29.40 29.60 27.85April 13.75 18.75 35.00 39.80 31.10 29.40 30.10 27.60May 13.75 21.00 36.80 39.80 31.10 29.40 30.10 26.85June 13.75 21.00 36.80 35.55 33.60 29.40 30.10 26.90July 13.20 23.50 36.80 35.55 33.60 29.40 30.10 27.10Aug. 13.20 23.50 36.80 35.55 33.60 29.40 30.10 27.10Sept. 13.20 23.50 36.80 35.55 33.60 29.40 30.10 27.70Oct. 13.20 23.50 36.80 35.55 33.60 29.80 28.25 27.80Nov. 13.20 26.27 36.80 36.90 33.60 29.80 28.95 28.60Dec. 13.20 26.27 36.80 36.90 33.60 29.80 28.00 28.00Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $24.75 $18.25 $16.65 $17.15 $21.50 $24.05 $18.50 $17.55 Feb. 19.35 17.05 15.60 16.95 19.95 20.00 18.35 18.70March 13.45 17.75 14.70 18.80 18.50 19.30 17.80 18.75April 12.20 18.00 16.50 20.35 16.50 19.20 19.15 18.55May 14.05 18.55 16.35 18.65 16.35 19.30 20.05 18.60June 11.70 18.60 15.55 17.70 15.15 18.35 21.15 17.30July 9.35 19.60 14.95 17.65 17.40 19.75 20.35 17.10Aug. 13.50 18.75 14.90 16.85 27.40 20.15 19.80 17.00Sept. 14.00 18.20 13.20 17.90 35.65 20.95 20.25 16.15Oct. 13.55 18.60 12.45 19.00 36.05 22.60 20.50 16.60Nov. 14.30 17.65 13.00 18.80 33.00 21.50 19.35 15.20Dec. 15.55 16.95 15.40 20.00 28.00 18.70 18.35 13.80Term-contract basis from 1978-84, spot prices from 1984-93. Note: More recent prices can be found in Chapter I.


TROLL Norway

Gravity: 28.6 Sulfur: 0.29 Loading Port: Mongstad

Production

After starting up in September 1995, the field rapidly reached plateau output of over200,000 barrels a day in mid-1996. The oil is produced from a thin layer of oil that lieson top of the giant Troll gas field. Output is from the Troll West field, where the oil layeris thick enough to allow extraction via horizontal wells. The crude oil is transported bypipeline to Mongstad for export.

Quality

A relatively heavy crude oil for the North Sea that is sweet and has wide middle distil-late cuts.

Producers

Operator Norsk Hydro (7.7%), with Statoil (11.9%), Shell (8.3%), Saga (4%), Elf (2.3%),Conoco (2%) and Total (1%), with the 62.7% state share held on behalf of the govern-ment by Statoil.


Prices are linked to North Sea Brent grade, selling at a slight premium particularly in thewinter months. The grade is sold primarily by Statoil, which controls over 70% of sales,and it moves mainly to refiners in Europe.

Sellers




Loading Port

Mongstad. 69.49 N. 05.02 E. Located on the west coast of Norway, the terminal accom-modates tankers up to 300,000 deadweight tons. The draft limitation at Berth No. 1, thecrude oil-loading berth, is 72 feet.


TROLL ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 28.6 Sulfur Content % Weight 0.29Barrels /Metric Ton 7.13 Pour Point Temp. C -48Viscosity Centistokes 16 Reid Vapor Press. kPa 27(Kinematic) at 20 C Total Acid mg KOH/g 0.58




Paraffins % Wt. 13.2Naphthenes % Wt. 69Aromatics % Wt. 17.8

Heavy Naphtha 150-180 4.58 4.22 Heavy NaphthaParaffins % Wt. 17.4Naphthenes % Wt. 54.6Aromatics % Wt. 28

Kerosine 180-240 11.01 10.51 KerosineSulfur Content % Wt. 0.026Freezing Point Temp. C <-60



Residue >375 39.14 41.98 ResidueSulfur Content % Wt. 0.57Pour Point Temp. C 18Viscosity (Kin) Cen at 50 C 370Asphaltenes % Wt. 0.99Conradson Carbon R % Wt. 5Vanadium Parts/mill. 3.1



OMAN Oman

Gravity: 35.2 Sulfur: 0.89 Loading Port: Mina Al Fahal

Production

Oman�s 880,000 barrels a day of production comes from several onshore fields and ismerged into a single export blend. Yibal, Rima, and Fahud are the country�s largest pro-ducing fields. Smaller production also comes from fields operated by Elf and Occidental.Oman exports just over 800,000 b/d.

Quality

A bit lighter and lower in sulfur than typical Mideast crude oils such as Arabian Light orDubai.

Producers

Most of the production is handled by Petroleum Development Oman, which is owned60% by the state, with the remainder divided among Royal/Dutch Shell (34%), Total (4%),and Partex (2%). Other smaller producers are Occidental, Elf, and Japex.


Next to Dubai, Oman is the most actively traded spot crude oil in the Mideast. The state�sMinistry of Petroleum and Minerals sets a monthly price retroactively for its term-contractsales, using a 30-day average of Oman spot market trades from the previous month. SpotOman grade is bought and sold at a differential to the established MPM price. Term salesby other equity producers are priced the same way. Most Oman crude oil goes to Asianmarkets, with Japan alone taking 290,000 b/d or 37% of total exports in 1995. SouthKorea, China, and Thailand are also important outlets, with occasional cargoes movingto the Atlantic Basin and the US West Coast. Roughly one-half of Oman production issold on a term-contract basis.

Sellers

While the state has a 60% stake in oil production, about 25% of its term crude oil vol-umes are resold by traders. Transworld Oil, which was once among the most prominent,was displaced in 1996, leaving others such as Japanese Itochu in more dominant posi-tions.

Petroleum Development Oman: P.O. Box 81, Muscat, Oman. Tel.: (968) 678-111,Fax: (968) 677-106.


Loading Port

Mina Al Fahal. 23.39 N. 58.32 E. The terminal is located on the Gulf of Oman coast,about 10 miles north of Muscat, the capital of Oman. Facilities include three single-buoymooring berths with floating hose strings. SBM 1 and SBM 2 supply export crude oil bymeans of submarine lines. Tankers up to 600,000 deadweight tons and 96 feet draft areaccommodated.


OMAN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.2 Sulfur Content % Weight 0.89Barrels /Metric Ton 7.418 Pour Point Temp. C <-30Viscosity Centistokes 19.98 Reid Vapor Press. Lbs/Sq. In. 5(Kinematic) at 10 C











Pour Point Temp. C -3Viscosity (Kin) Cen at 60 C 148Asphaltenes % Wt. <0.5Conradson Carbon R % Wt. 7.54Vanadium Parts/mill. 14


OMAN TERM CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.06 $14.00 $30.26 $37.56 $35.06 $34.06 $28.60 $27.66 Feb. 13.06 14.53 30.26 37.56 35.06 30.06 28.55 27.51March 13.06 14.53 30.26 37.56 34.36 29.06 28.55 27.50April 13.06 17.56 32.26 37.56 34.36 29.06 28.55 27.35May 13.06 18.36 30.00 37.56 34.36 29.06 28.55 26.15June 13.06 19.54 30.00 37.56 34.36 29.06 28.55 25.90July 13.06 22.06 32.00 37.56 34.06 28.60 28.55 26.10Aug. 13.06 22.06 33.46 37.56 34.06 28.60 28.55 26.92Sept. 13.06 22.06 33.46 37.56 34.06 28.60 28.55 27.37Oct 13.06 24.26 33.46 36.06 34.06 28.60 28.55 27.20Nov. 13.06 26.00 33.46 34.01 34.06 28.60 28.55 27.35Dec. 13.06 28.26 33.46 34.01 34.06 28.60 28.55 26.87Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $23.83 $17.57 $15.95 $14.82 $18.15 $20.30 $16.20 $15.84 Feb. 15.80 17.63 15.57 15.10 17.50 15.56 16.70 16.80March 11.85 17.63 13.81 16.77 16.35 15.85 16.65 16.95April 10.90 17.63 15.25 17.69 14.90 16.20 17.50 17.05May 11.85 17.63 15.22 16.20 15.05 16.90 18.50 16.70June 10.70 17.63 14.09 15.93 13.55 16.28 20.00 16.46July 8.20 17.63 13.34 15.95 15.85 17.05 19.43 15.21Aug. 12.05 17.63 13.50 15.45 26.10 17.45 18.70 15.46Sept. 13.43 17.25 11.75 16.12 31.55 18.72 19.10 14.60Oct. 13.55 17.38 10.78 16.63 32.85 19.70 18.69 15.26Nov. 14.10 17.07 10.65 16.65 29.30 19.20 17.64 14.64Dec. 15.25 16.00 12.82 17.70 24.12 16.12 16.90 12.68Note: More recent prices can be found in Chapter I.


KUTUBU Papua New Guinea

Gravity: 44 Sulfur: .04 Loading Port: KumulOther Names: Iagifu

Production

About 100,000 barrels a day was produced in 1995, with volumes expected to reboundin late 1997 as the nearby Gobe fields are added to the stream, bringing an additional45,000 b/d of output to offset mature flows from the Iagifu-Hedina fields. The fields arelocated in a remote inland area and oil is taken to the export terminal via a 265 km,150,000 b/d pipeline.

Quality

One of the few light, sweet crude oils in the Asia-Pacific region that is low in wax, mak-ing it similar to top West African grades and an excellent source for gasoline.

Producers

Chevron is the operator of the main Iagifu-Hedina fields with 19.37%, the State ResourceDevelopment Agency holds 22.5%, and other partners include British Petroleum(19.37%), Ampolex, BHP, and Mitsubishi. Partners in the Gobe and Hedina fields includeChevron, two state firms, and a number of regional independents.


The government and the two main equity producers market their output independentlywith a mix of term and spot sales. The smaller producers have formed a marketing con-sortium to handle their barrels. Australia and China are the main buyers, taking about30% each, with South Korea, Taiwan, and the US also providing outlets. Pricing is basedon spot quotes for Malaysian Tapis from Asian Petroleum Price Index.

Sellers

Petroleum Resources Kutubu: Invesmen Haus, Douglas St., P.O. Box 1076, PortMoresby, Papua New Guinea. Tel.: (675) 21-7133, Fax: (675) 21-7603.

Chevron International Oil Co.: 1 Scotts Road #20-13, Shaw Centre, 0922 Singapore.Tel.: (65) 734-5521.

British Petroleum: BP Tower, 396 Alexandra Road, 0511 Singapore. Tel.: (65) 475-6633, Fax: (65) 371-8795.

Loading Port

Kumul. 8.06 S. 144.33 E. Located on the coast of the Gulf of Papua, the marine termi-nal consists of one single-point mooring designed to accommodate ships up to 150,000deadweight tons and 17 meters draft.


KUTUBU ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity API 44 Sulfur Content % Weight 0.04Barrels /Metric Ton 7.818 Pour Point Temp. F 35Viscosity Centistokes 1.6(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 3 LPGLight Naphtha 55-175 11.5 Light Naphtha





Atm. Gas Oil 500-650 15.3 Atmospheric Gas OilSulfur Content % Wt. 0.04Cetane Index 48

Residue >650 21.1 ResidueGravity API 22.9Sulfur Content % Wt. 0.15



DUKHAN Qatar

Gravity: 41.1 Sulfur: 1.22 Loading Port: Umm SaidOther Names: Qatar Land

Production

Some 240,000 barrels a day is produced exclusively from the large onshore Dukhan field,which was discovered in 1939. The field is mature, but output rates are expected to risethrough enhanced-recovery investments, reaching capacity of 340,000 b/d by 2000.

Quality

A top-quality light Mideast crude oil, but its higher sulfur content and paraffinic naphthamake it less valuable than equally light African or North Sea crude oils. Although theassay below is 11 years old, recent tests show little change in quality, with a gravity of40.7 degrees API and sulfur content of 1.25%.

Producers

All production is owned by state QGPC, but the field is operated by OccidentalPetroleum under a contract awarded in 1994. The possibility of bringing in foreign firmsas production sharing partners has been considered, but as of 1996 QGPC seemed like-ly to expand the fields independently.


Dukhan, like Qatar Marine crude oil, is sold on the basis of a retroactive monthly pricethat is linked to the Oman monthly official posting plus a premium. Most of the oil issold under term contracts by QGPC. The main customers are Asian refiners, with theJapanese alone taking 160,000 b/d. The grade rarely sells on the spot market or movesto the Atlantic Basin, and it has become increasingly sought after in Asia due to its lightproducts yield.

Seller

Qatar General Petroleum Corp.: QGPC Marketing Group, P.O. Box 3212, Doha,Qatar. Tel.: (974) 491-491, Fax: (974) 831-138, Telex: 4343 PETCOR DH.

Loading Port

Umm Said. 24.54 N. 51.34 E. Located approximately 30 miles south of Doha, the UmmSaid terminal contains two loading berths. The North Berth is a single-point mooringconnected to a shore installation via a 36-inch submarine pipeline. Maximum tonnage is320,000 deadweight tons. The South Berth is a conventional-buoy mooring connected toshore by a 24-inch submarine pipeline. Maximum tonnage is 320,000 dwt.


DUKHAN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 41.1 Sulfur Content % Wt. 1.22Barrels /Metric Ton 7.68 Pour Point Temp. C -9Viscosity Centistokes 2.7 Reid Vapor Press. Lbs/Sq. In. 11.2(Kinematic) at 40 C











Pour Point Temp. C 33Viscosity (Kin) Cen at 60 C 49.6Asphaltenes % Wt. 0.45Conradson Carbon R % Wt. 4.96Vanadium Parts/mill. 6


DUKHAN TERM-CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.19 $14.03 $29.42 $37.42 $35.45 $34.49 $29.49 $29.24 Feb. 13.19 15.05 29.42 37.42 35.45 30.49 29.49 28.10March 13.19 15.05 29.42 37.42 34.49 29.49 29.49 28.10April 13.19 17.04 29.42 37.42 34.49 29.49 29.49 28.10May 13.19 17.84 31.42 37.42 34.49 29.49 29.49 28.10June 13.19 17.84 31.42 37.42 34.49 29.49 29.49 28.10July 13.19 21.42 33.42 37.42 34.49 29.49 29.49 28.10Aug. 13.19 21.42 33.42 37.42 34.49 29.49 29.49 28.10Sept. 13.19 21.42 33.42 37.42 34.49 29.49 29.49 28.10Oct. 13.19 21.42 33.42 37.42 34.49 29.49 29.49 28.10Nov. 13.19 27.42 33.42 35.65 34.49 29.49 29.49 28.10Dec. 13.19 27.42 33.42 35.65 34.49 29.49 29.49 28.10Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $28.10 $17.57 $16.05 $14.92 $18.45 $21.10 $17.05 $16.69 Feb. 28.10 17.82 15.67 15.20 17.80 16.36 17.55 17.30March 12.20 17.82 13.91 16.87 16.65 16.65 17.50 17.45April 10.85 17.82 15.40 17.79 15.15 16.85 18.35 17.55May 11.75 17.82 15.37 16.30 15.35 17.45 19.30 17.23June 10.70 17.82 14.19 16.03 13.85 16.83 20.75 16.96July 8.10 17.82 13.44 16.05 16.15 17.65 20.08 15.71Aug. 12.15 17.82 13.60 15.60 26.60 18.15 19.20 15.96Sept. 13.48 17.82 11.80 16.27 32.05 19.57 19.60 15.25Oct. 13.60 17.82 10.83 16.83 33.35 20.55 19.19 15.98Nov. 14.20 17.82 10.70 16.85 29.80 20.05 18.14 15.40Dec. 15.35 17.82 12.87 17.95 24.82 16.97 17.40 13.43Note: More recent prices can be found in Chapter I.


QATAR MARINE Qatar

Gravity: 36.2 Sulfur: 1.60 Loading Port: Halul Island

Production

Output has increased from about 160,000 barrels a day in 1995 to some 200,000 b/d in1996 thanks to work by Occidental on the Idd El Shargi field and new output by Maerskfrom the Al-Shaheen field. Volumes also come from the Maydan Mahzam and Bul Haninefields as well as some smaller offshore fields. Production capacity is likely to grow fur-ther with these investments, reaching some 300,000 b/d by 2000.

Quality

A light, high-sulfur Mideast crude oil of somewhat higher quality than Arabian Light.Although the assay below is old, it is still representative of the crude oil�s characteristics.

Producers

Occidental is the producer of the Idd El Shargi field and Maersk is the producer of theAl-Shaheen field, both under production-sharing contracts. State Qatar GeneralPetroleum Corp. is the sole producer of the other Qatar Marine fields, which are oper-ated by Occidental.


Qatar Marine grade is traded on the spot market and sold on term contracts. An esti-mated 10%-20% of Qatari production trades on the spot market, and most of that is QatarMarine. The grade rarely heads to any market but the Far East, and term contracts arefirmly in the grasp of Japanese refiners, which take about 120,000 b/d. Volumes also goto refiners in Taiwan and South Korea. Prices are established every month on a retroac-tive basis. They are set at a premium to the official Oman monthly price or MPM. It isextremely rare for spot Qatari grade to trade at a discount to its official monthly price.

Sellers

Qatar General Petroleum Corp.: QGPC Marketing Group, P.O. Box 3212, Doha,Qatar. Tel.: (974) 491-491, Fax: (974) 831-138, Telex: 4343 PETCOR DH.

Loading Port

Halul Island. 25.40 N. 52.25 E. Halul Island, located 52 miles northeast of Doha, the cap-ital of Qatar, serves as the export terminal for Qatar Marine. Halul terminal has two load-ing points. Both are single-buoy moorings capable of accommodating vessels up to550,000 deadweight tons. Maximum drafts are 22 meters (72 feet) for SBM 1 and 29 m(95 ft) for SBM 2.


QATAR MARINE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.8 Sulfur Content % Weight 1.47Barrels /Metric Ton 7.444 Pour Point Temp. C -15Viscosity Centistokes 9 Reid Vapor Press. Lbs/Sq. In. 7.1(Kinematic) at 10 C Hydrogen Sulfide Parts/mill. 138











Pour Point Temp. C/F 30/86Viscosity (Kin) Cen at 60 C 86.7Asphaltenes % Wt. 1.1Conradson Carbon R % Wt. 7.2Vanadium Parts/mill. 20


QATAR MARINE TERM CONTRACT PRICES, 1978-93Prices At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.06 $13.77 $29.23 $37.23 $35.30 $34.06 $28.60 $29.05 Feb. 13.06 14.53 29.23 37.23 35.30 30.30 28.55 28.05March 13.06 14.53 29.23 37.23 34.30 29.30 28.55 27.50April 13.06 16.85 32.26 37.23 34.30 29.30 28.55 27.35May 13.06 18.36 31.23 37.23 34.30 29.30 28.55 26.15June 13.06 19.54 31.23 37.23 34.30 29.30 28.55 25.90July 13.06 21.23 33.23 37.23 34.06 28.60 28.55 26.10Aug. 13.06 21.23 33.46 37.23 34.06 28.60 28.55 26.92Sept. 13.06 21.23 33.46 37.23 34.06 28.60 28.55 27.37Oct. 13.06 24.26 33.46 36.06 34.06 28.60 28.55 27.20Nov. 13.06 27.23 33.46 35.50 34.06 28.60 28.55 27.35Dec. 13.06 28.26 33.46 35.50 34.06 28.60 28.55 26.87Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $23.83 $17.67 $16.00 $14.87 $18.40 $21.05 $17.00 $16.54 Feb. 15.80 17.67 15.62 15.15 17.75 16.31 17.50 17.15March 12.10 17.67 13.86 16.82 16.60 16.60 17.45 17.30April 10.75 17.67 15.35 17.74 15.10 16.85 18.30 17.40May 11.65 17.67 15.32 16.25 15.30 17.45 19.25 17.08June 10.60 17.67 14.14 15.98 13.80 16.83 20.65 16.81July 8.05 17.67 13.39 16.00 16.10 17.60 19.98 15.56Aug. 12.10 17.67 13.55 15.55 26.55 18.10 19.10 15.81Sept. 13.43 17.67 11.75 16.22 32.00 19.52 19.45 14.95Oct. 13.55 17.67 10.78 16.78 33.30 20.50 19.04 15.70Nov. 14.10 17.67 10.65 16.80 29.75 20.00 17.99 15.16Dec. 15.25 17.67 12.82 17.90 24.77 16.92 17.25 13.18Note: More recent prices can be found in Chapter I.


SIBERIAN LIGHT Russia

Gravity: 35-38 Sulfur: 0.45-0.55 Loading Port: Tuapse

Production/Exports

Actual production volumes are not available but exports range from 60,000-110,000 bar-rels a day per month, with an average of about 90,000 b/d in 1995. Volumes are restrict-ed by the capacity of the segregated pipeline from West Siberia to the Black Sea port ofTuapse as well as by the port facilities. Siberian Light accounts for only about 5% ofexports outside the former Soviet Union, but volumes could rise if there were greaterscope for segregating crude oils by quality.

Quality

Quality fluctuates more than most internationally traded grades. It is is a relatively light,sweet stream that is considered to be comparable to Syrian Light. In 1996, gravityreached as much as 38-degrees at times versus the usual 35.

Producers

Siberian Light comes mainly from Lukoil�s Urayneftegaz and Sidanko�s Kondpetroleumproduction associations in the province of Tyumen in West Siberia.


Siberian Light is sold into the Mediterranean spot market at prices that are set at a vari-able premium to North Sea Brent. The premium tends to fluctuate with movements inthe prices of Urals and Syrian Light. The grade has established a solid niche for itself witha handful of refiners that are sometimes willing to pay relatively high prices for the crudeoil compared to alternative grades. In addition to various Mediterranean refiners, regularcustomers include Exxon and Austria�s OMV as well as the Skopje refinery in Macedonia.

Sellers

Lukoil: Stroenie 2, Pereulok Zvonarsky 2, 103031 Moscow, Russia. Tel.: (7-095) 236-9841. Fax: (7-095) 236-4317. Telex: (7-095) 612-553.

Conex International Trading: Prospekt Vernadskogo 84/2, 117606 Moscow, Russia.Tel.: (7-095) 436-0644. Fax: (7-095) 436-0693. (Conex is owned partly by producerKondpetroleum).

General Petroleum Services: Suite 13, Weinberg Strasse, 10th District Wien, Austria.Tel: (43-1) 79772. Fax. (43-1) 797-7255. Telex: 111193 GPSA.

Taurus Petroleum Services: 5 Prince�s Gate, London SW7 1QJ, England. Tel.: (44-171) 838-0088. Fax: (44-171) 838-0099.

Loading Port

Tuapse. 44.05 N. 39.10 E. The port is located on the northeast shore of the Black Sea tothe east of the main port of Novorossiysk. Siberian Light is received by a dedicatedpipeline at of the Zareche oil terminal, which handles mainly Siberian Light. The termi-nal has two berths: No.1 can handle tankers up to 250 meters in length with a draft ofup to 11.5-meters; No.2 handles vessels of up 170 meters in length and 11.2 meters draft.The terminal has 375,000 barrels of usable storage capacity.


SIBERIAN LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.6 Sulfur Content % Weight .0.46Barrels /Metric Ton 7.44 Paraffins % Weight 2.4


Cut Points YieldProduct Temp. C % Wt.Naphtha <200 29Light Mid-Distillate 200-300 20Heavy Mid-Distillate 300-350 11Residue >350 40



URALS Russia

Gravity: 31-33 Sulfur: 1.20-1.80 Loading Ports: Novorossiysk, VentspilsProduction/ExportsAll but about 100,000 barrels a day of Russia�s crude oil exports are from a blend ofgrades known as Urals, which comes from all regions due to the limited ability of thepipeline system to segregate oil of different qualities. Total Russian crude oil exportshave risen gradually due to falling domestic demand, and stood at about 2.5-million b/din 1996. With declining sales to other former Soviet republics, exports outside the ex-USSR have risen steadily, reaching 1.9-million b/d in 1995 and likely to exceed 2-millionb/d in 1996. But with ports operating at 90%-100% of capacity, further growth dependson greater use of the Druzhba (Friendship) Pipeline.

QualityUrals quality fluctuates significantly due to the many crude oils in the blend and outputchanges. Variations have been sharpest at the Baltic port of Ventspils, where gravity hasfallen as low as 27-degrees API and sulfur content has climbed to as high as 3%. Thebest and most consistent quality has been available from pipeline exports through theDruzhba system that supplies Eastern Europe. The assay below is from the Soviet era andreflects somewhat higher quality.

ProducersRussia�s integrated oil companies produce and export crude oil through production asso-ciations. Foreign oil companies also have export rights through joint ventures and pro-duction sharing deals.

Pricing And MarketingA dominant grade in the Mediterranean market and Eastern Europe that is widely trad-ed in the spot market, Urals is also available through term arrangements and barter. Uralsis almost always priced in relation to dated Brent. It is sold on a delivered basis in bothNorthwest Europe and the Mediterranean, and free-on-pipe into Eastern Europe. About55% of exports were by sea and 45% by pipeline in 1995.

SellersIn addition to the over 35 production associations that export crude oil there are manyforeign joint ventures, traders and other intermediaries involved. Some exporters alsorely on the services of the state exporter Nafta Moskva, formerly Soyuznefteexport.Several traders with special connections also specialize in acting as intermediaries in trad-ing Russian crude oil.

Nafta Moskva: Smolenskaya-Sennaya Plochad 32/34, Moscow 121200, RussianFederation. Tel.: (7-095) 244-4527, Fax: (7-095) 244-4054.

Lukoil: Stroenie 2, Pereulok Zvonarsky 2, 103031 Moscow, Russia. Tel.: (7-095) 236-9841. Fax: (7-095) 236-4317. Telex: (7-095) 612-553.

Conex International Trading: Prospekt Vernadskogo 84/2, 117606 Moscow, Russia.Tel.: (7-095) 436-0644. Fax: (7-095) 436-0693.

Loading PortsNovorossiysk. 44.43 N. 37.47 E. The Sheskharis oil terminal, in the port of Novorossiyskon the north shore of the Black Sea, accommodates tankers up to 250,000 deadweighttons and 19 meters maximum draft. It consists of one deep- water berth for vessels from80,000-250,000 dwt, but due to the restrictions of the Bosporus Straits, only tankers upto 150,000 dwt can be fully loaded. Strong winter winds often close the port for extend-ed periods.Ventspils. 57.24 N. 21.33 E. Located in the former Soviet republic of Latvia, the port�sdepth is restricted to 12.5 m, and only tankers of a maximum 45,000 dwt can load there.There are six berths for crude oil and refined products.


URALS ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 33.4 Sulfur Content % Weight 1.19Barrels /Metric Ton 7.34 Pour Point Temp. C -9Viscosity Centistokes 5.86 Reid Vapor Press. Lbs/Sq. In. 7(Kinematic) at 40 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 3.1 2 LPGLight Naphtha <85 7.5 5.9 Light Naphtha



Kerosine 165-235 11.8 11 Kerosine329-455 Sulfur Content % Wt. 0.11








URALS MEDITERRANEAN SPOT PRICES, 1986-93

Prices For Delivered Cargoes In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. ... $18.05 $16.00 $15.85 $20.30 $22.70 $17.05 $15.60 Feb. ... 16.75 15.15 16.00 19.00 18.75 17.05 16.85March $13.50 17.30 14.10 17.75 17.25 18.45 16.45 17.15April 12.00 17.80 15.75 19.40 15.10 18.45 17.95 16.85May 12.60 18.10 15.50 17.75 14.65 18.15 18.65 16.60June 10.75 18.35 14.70 16.65 13.35 16.75 19.75 16.40July 8.55 19.20 14.10 16.90 15.60 18.25 18.90 15.10Aug. 12.75 18.55 14.05 16.10 26.70 18.65 18.35 15.05Sept. 13.25 17.65 12.40 17.05 34.70 19.50 18.70 14.30Oct. 12.80 17.95 11.55 18.15 35.35 21.20 19.10 15.20Nov. 13.55 16.95 11.95 18.05 31.95 19.95 18.20 13.95Dec. 15.15 15.90 14.15 19.05 26.95 17.05 16.70 12.65Note: More recent prices can be found in Chapter I.


ARABIAN EXTRA LIGHT Saudi Arabia

Gravity: 36.4 Sulfur: 1.19 Loading Port: Ras TanuraOther Names: Berri

Production

Output reached 700,000 barrels a day during the Gulf war, and capacity has since beenexpanded to 950,000 b/d. Production comes from the Berri field, which lies mainly off-shore near the Gulf port of Jubail and the onshore Abqaiq field. Development of theShaybah field is expected to eventually add 500,000 b/d or more in 1998.

Quality

A light, medium-sulfur Mideast crude oil similar to top-quality Abu Dhabi grades. Goodfor making kerosine and petrochemical naphtha, but, unlike West African and North Seacrude oils, it is not especially good for gasoline manufacturing.

Producers

Produced entirely by Saudi Arabian Oil Co. (Saudi Aramco), the 100% state-owneddescendant of the Aramco consortium of Chevron, Texaco, Exxon, and Mobil.


Sales are to all main geographic regions on a term-contract basis. But the Asia-Pacificregion retains its role as a primary outlet despite recent increases in output. Japaneserefiners alone take about 200,000 b/d. Term-contract sales are priced under geographi-cally specific formulas that are tied to the spot prices of US West Texas Intermediate forUS deliveries, North Sea Brent Blend for European deliveries, and an average of Omanand Dubai spot prices for deliveries East of Suez. Sales are made on both a deliveredand an f.o.b. or at-source basis. There are few spot sales.

Sellers

Saudi Aramco and its affiliate, Saudi Petroleum International, are exclusive term- contractsellers. SPI handles all sales in the Atlantic Basin and also has offices in London,Singapore, and Tokyo.

Saudi Aramco: Saudi Arabian Oil Co., Box 5000, Dhahran, 31311, Saudi Arabia. Tel.:(966-3) 875-6110, Telex: (928) 801220 ARAMCO SJ.

Saudi Petroleum International: 527 Madison Ave., New York, NY 10022. Tel.: (212)832-4044, Fax (212) 832-4688, Telex: 420819.

Loading Port

Ras Tanura. 26.38 N. 50.10 E. The primary export outlet is on the west side of theMideast Gulf, with a total of 15 berths. It can accommodate tankers up to 550,000 dead-weight tons, and it is supported by a 33-million-barrel storage terminal.


ARABIAN EXTRA LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 36.6 Sulfur Content % Weight 1.35Barrels /Metric Ton 7.485 Pour Point Temp. C -5Viscosity Centistokes 38.9 Reid Vapor Press. Lbs/Sq. In. 4.3(Kinematic) at 100F Hydrogen Sulfide Parts/mill. nil


Cut Points YieldProduct Temp. F % Vol. % Wt. Properties Unit ValueLPG 1.5 1 LPGLight Naphtha <200 8.8 6.9 Light Naphtha




Light Gas Oil 400-500 15.5 15.1 Light Gas OilSulfur Content % Wt. 0.42Cetane Index 53

Int. Gas Oil 500-600 9.7 9.8 Intermediate Gas OilSulfur Content % Wt. 1.16Cetane Index 56.5

Residue >600 42 46.6 ResidueSulfur Content % Wt. 2.61Pour Point Temp.F 50Viscosity (Kin) cts 100F 158.1Vanadium Parts/mill. 6



ARABIAN HEAVY Saudi Arabia

Gravity: 27.5 Sulfur: 2.92 Loading Ports: Ras Tanura, JuaymahOther Names: Safaniyah

Production

Output in 1996 was about 400,000 barrels a day out of a total capacity of 1.2-millionb/d from the Safaniyah field and other offshore fields in the northern Gulf. Over 300,000b/d of capacity was mothballed in 1994 to cut costs, leaving another 400,000-500,000b/d to spare.

Quality

A heavy, high-sulfur Mideast crude oil that is especially attractive to refiners with exten-sive upgrading capacity such as cokers.

Producers



Almost all production is sold on a term-contract basis, but sales volumes were cut backin 1993-94 in favor of higher-revenue lighter grades. Sales are priced under geographi-cally specific formulas that are tied to the spot prices of US West Texas Intermediate forUS deliveries, North Sea Brent Blend for European deliveries, and an average of Omanand Dubai spot prices for deliveries East of Suez. Sales are made on both a deliveredand an f.o.b. or at-source basis. The grade is often sold in combination with other Saudigrades. The few spot sales are usually directed to existing term-contract customers. Japanimported 90,000 b/d in 1995.

Sellers

Saudi Aramco and its affiliate, Saudi Petroleum International, are exclusive term-contractsellers. SPI handles all sales in the Atlantic Basin and has additional offices in London,Tokyo, and Singapore.



Main Customers

Arabian Heavy sales are made mainly to refiners with more sophisticated upgradinghardware, and thus the US absorbs a disproportionately large share.

Loading Ports

Ras Tanura. 26.38 N. 50.10 E. The primary export outlet is on the west side of theMideast Gulf, with a total of 15 berths. It can accommodate tankers up to 550,000 dead-weight tons, and it is supported by a 33-million-barrel storage terminal.Juaymah. 26.56 N. 50.03 W. A secondary terminal located approximately 18 miles north-northwest of the Ras Tanura Terminal and 7 miles offshore, with six single-point moor-ing berths for deep-water loading of tankers up to 700,000 dwt and a storage terminalwith capacity of 17.5-million barrels.


ARABIAN HEAVY ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 27.5 Sulfur Content % Weight 2.92Barrels /Metric Ton 7.084 Pour Point Temp. C 5Viscosity Centistokes 98.7 Reid Vapor Press. Lbs/Sq. In. 8.3(Kinematic) at 100 F Hydrogen Sulfide Parts/mill. nil


Product Temp. F % Vol. % Wt. Properties Unit ValueLPG 2.8 1.7 LPGLight Naphtha <200 6.7 5 Light Naphtha



Kerosine 315-400 7 6.3 KerosineSulfur Content % Wt. 0.09Freezing Point Temp. F -83

Light Gas Oil 400-500 12.5 11.7 Light Gas OilSulfur Content % Wt. 0.78Cetane Index 46.5

Int. Gas Oil 500-600 9.7 9.5 Intermediate Gas OilSulfur Content % Wt. 1.79Cetane Index 50

Residue >600 52.6 58.5 ResidueSulfur Content % Wt. 4.08Pour Point Temp. F 70Viscosity (Kin) cts 100 F 6289Vanadium Parts/mill. 77


ARABIAN HEAVY TERM CONTRACT PRICES, 1978-93At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $12.02 $12.51 $25.00 $31.00 $31.00 $31.00 $26.00 $26.50 Feb. 12.02 12.71 25.00 31.00 31.00 27.00 26.00 26.50March 12.02 12.71 25.00 31.00 31.00 26.00 26.00 26.50April 12.02 13.64 27.00 31.00 31.00 26.00 26.00 26.50May 12.02 13.64 27.00 31.00 31.00 26.00 26.00 26.50June 12.02 17.17 27.00 31.00 31.00 26.00 26.00 26.50July 12.02 17.17 27.00 31.00 31.00 26.00 26.00 24.00*Aug. 12.02 17.17 29.00 31.00 31.00 26.00 26.00 22.35*Sept. 12.02 17.17 29.00 31.00 31.00 26.00 26.00 23.55*Oct. 12.02 17.17 29.00 31.50 31.00 26.00 26.00 24.60*Nov. 12.02 23.17 31.00 31.50 31.00 26.00 26.00 25.05*Dec. 12.02 23.17 31.00 31.50 31.00 26.00 26.00 22.25*Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $18.60 $14.95* $13.21 $13.82 $16.22 $11.89 $12.13 $14.50 Feb. 13.60 16.27 13.70 15.85 14.75 12.57 13.19 14.30March 15.50 16.27 14.15 16.23 12.56 13.53 14.24 14.22April 12.35 16.27 13.13 15.52 11.57 13.82 16.15 13.84May 12.65 16.27 12.65 14.94 11.51 12.90 16.31 12.78June 9.80 16.27 12.13 14.47 16.20 13.20 16.28 12.52July 7.60 16.27 11.33 14.37 22.53 14.23 15.98 11.85Aug. 9.90 16.27 10.24 14.97 30.33 15.16 16.11 12.08Sept. 11.25 16.27 9.34 15.38 30.49 15.75 15.60 11.38Oct. 10.60 15.45 9.76 15.87 27.65 13.83 14.73 10.06Nov. 10.45 14.20 11.46 16.95 22.89 12.23 14.10 9.74Dec. 10.90 12.40 13.09 17.00 13.80 12.20 13.93 10.32Official government-set prices in 1978-85 and in 1987, except where indicated. Netback prices in 1986 and volume-weightedaverages of the various regional spot crude-linked formula prices from October 1987 onward. *Indicates netback prices.Note: More recent prices can be found in Chapter I.


ARABIAN LIGHT Saudi Arabia

Gravity: 32.7 Sulfur: 1.8 Loading Ports: Ras Tanura, Juaymah, Yanbu

ProductionIn 1996, output was in the 5- to 5.3-million barrels a day range, making it the world�slargest crude oil stream. Production is drawn from several onshore fields in the easternpart of the country, with the massive Ghawar field, the world�s largest, being the mainsource. Capacity is about 5.3-million b/d.

QualityA Mideast and global benchmark grade because of its wide acceptance. It is typical oflight, high-sulfur, Mideast-type crude oils.

ProducersProduced entirely by Saudi Arabian Oil Co. (Saudi Aramco), the 100% state-owneddescendant of the Aramco consortium of Chevron, Texaco, Exxon, and Mobil.

Pricing And MarketingThe grade is sold worldwide to virtually all Saudi customers. Term-contract sales makeup the bulk of exports, and these are priced under geographically specific formulas thatare tied to the spot prices of US West Texas Intermediate for US deliveries, North SeaBrent Blend for European deliveries, and an average of Oman and Dubai spot prices fordeliveries East of Suez. Sales are made on both a delivered and an f.o.b. or at-sourcebasis. Prices for f.o.b. sales to the Atlantic Basin are triggered 40-50 days after loading inorder to reduce price risk for buyers. There are few spot sales, and these are directed toterm-contract customers. Restricted volumes can be resold by term-contract customerswith approval. Arabian Light is also the primary feedstock for Saudi Arabia�s 1.8-millionb/d domestic refining capacity, leaving about 3.5-million b/d for export. Japan imported365,000 b/d in 1995.

SellersSaudi Aramco and its affiliate Saudi Petroleum International are exclusive term-contractsellers. SPI handles all sales in the Atlantic Basin and also has offices in London, Tokyo,and Singapore.



Loading PortsRas Tanura. 26.38 N. 50.10 E. The primary export outlet is on the west side of theMideast Gulf with a total of 15 berths. It can accommodate tankers up to 550,000 dead-weight tons, and it is supported by a 33-million-barrel storage terminal.Juaymah. 26.56 N. 50.03 W. A secondary terminal located approximately 18 miles north-northwest of the Ras Tanura Terminal and 7 miles offshore, with six single-point moor-ing berths for deep-water loading of tankers up to 700,000 dwt and a storage terminalwith capacity of 17.5-million barrels.Yanbu. 23.57 N. 38.13 E. King Fahd Port at Madinat Yanbu Al Sinaiyah is the main indus-trial port on the Red Sea. The crude oil terminal serves as a loading facility for the 48-inch Petroline crude oil pipeline from Abqaiq in the Eastern Province. Total crude oilstorage is 11-million barrels, with three loading berths able to handle vessels up to500,000 deadweight tons. Customers loading at Yanbu are charged an extra 25¢ a barrelover Mideast Gulf prices.


ARABIAN LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 32.7 Sulfur Content % Weight 1.8Barrels /Metric Ton 7.31 Pour Point Temp. C -5Viscosity Centistokes 47.3 Reid Vapor Press. Lbs/Sq. In. 4.2(Kinematic) at 100 F Hydrogen Sulfide Parts/mill. nil


Product Temp. F % Vol. % Wt. Properties Unit ValueLPG 1.7 1.1 LPGLight Naphtha <200 6.5 5.1 Light Naphtha






Residue >600 46.7 51.9 ResidueSulfur Content % Wt. 3.29Pour Point Temp. F 55Viscosity (Kin) cts 100 F 453Vanadium Parts/mill. 28


ARABIAN LIGHT TERM-CONTRACT PRICES, 1985-93At Gulf Ports In Dollars Per BarrelMonth 1985 1986 1987 1988 1989 1990 1991 1992 1993Jan. $29.00 $20.50 $16.85* $15.04 $15.14 $17.53 $16.87 $15.51 $16.59 Feb. 28.00 15.50 17.52 15.43 16.67 16.23 15.60 16.27 16.88March 28.00 17.42 17.52 15.80 17.25 14.50 16.49 17.16 16.67April 28.00 14.27 17.52 14.58 16.89 13.43 16.76 18.65 16.41May 28.00 14.53 17.52 14.17 16.20 13.64 16.21 18.82 15.45June 28.00 11.68 17.52 13.54 15.76 17.16 16.25 18.95 15.14July 24.90* 9.48 17.52 12.74 15.70 22.74 17.24 18.60 14.38Aug. 24.25* 11.78 17.52 11.87 16.09 32.29 18.01 18.51 14.68Sept. 25.45* 13.15 17.52 10.83 16.56 30.47 18.84 18.22 13.92Oct. 26.50* 12.52 17.45 11.05 17.05 28.29 17.72 17.34 12.91Nov. 26.95* 12.35 16.20 12.55 17.90 25.26 16.38 16.65 12.49Dec. 24.15* 12.80 14.40 14.08 18.14 19.32 15.74 16.32 12.69Official government-set prices in 1985 and 1987, except where indicated. Netback prices in 1986 and volume-weighted aver-ages of the various regional formula prices from October 1987 onward. *Netback prices.

ARABIAN LIGHT SPOT PRICES, 1987-93Month 1987 1988 1989 1990 1991 1992 1993Jan. ... $15.80 $14.70 $18.55 $20.85 $15.85 $15.80 Feb. ... 15.60 15.00 17.60 16.10 16.05 16.05March $17.30 13.75 16.40 16.50 15.95 16.15 16.95April 17.35 15.05 17.95 14.70 16.70 17.25 16.90May 17.30 15.00 16.90 14.45 16.50 18.10 16.60June 17.50 14.00 16.05 12.80 15.30 19.55 15.80July 17.75 13.35 15.90 14.60 16.90 18.95 14.75Aug. 17.75 13.25 15.30 24.85 17.25 18.25 14.70Sept. 17.45 11.80 16.10 31.40 18.15 18.65 14.15Oct. 17.40 10.60 17.00 33.00 19.75 18.50 14.95Nov. 17.15 10.85 17.00 30.05 19.05 17.40 13.75Dec. 16.50 12.75 17.80 24.85 16.05 16.50 12.05Note: More recent prices can be found in Chapter I.


ARABIAN MEDIUM Saudi Arabia

Gravity: 31.8 Sulfur: 2.45 Loading Ports: Ras Tanura, Juaymah

Production

Output in 1996 was about 1.3-million barrels a day, or well-below capacity of around1.9-million b/d, of which some 500,000 b/d is mothballed.

Quality

Similar to Kuwait crude oil and Iran Heavy: a typical Mideast medium-gravity, high-sul-fur crude oil.

Producers



Term contracts account for most sales and are priced under geographically specific for-mulas that are tied to the spot prices of US West Texas Intermediate for US deliveries,North Sea Brent Blend for European deliveries, and an average of Oman and Dubai spotprices for deliveries East of Suez. Sales are made on both a delivered and an f.o.b. or at-source basis. There are few spot sales, and these are usually directed to existing term-contract customers. Restricted volumes can be resold on the local regional spot marketby term-contract customers with approval.

Sellers

Saudi Aramco and its affiliate, Saudi Petroleum International, are exclusive term-contractsellers. SPI handles all sales in the Atlantic Basin and also has offices in London,Singapore and Tokyo.

Saudi Aramco: Saudi Arabian Oil Co., Box 5000, Dhahran, 31311, Saudi Arabia. Tel.:966-3-875-6110, Telex: (928) 801220 ARAMCO SJ.


Main Customers

Sold worldwide in combination with other Saudi crude oils, but most popular amongmore sophisticated refiners such as those in the US. Japan takes only about 170,000 b/d.

Loading Ports

Ras Tanura. 26.38 N. 50.10 E. The primary export outlet is on the west side of theMideast Gulf, with a total of 15 berths. It can accommodate tankers up to 550,000 dead-weight tons, and it is supported by a 33-million-barrel storage terminal.Juaymah. 26.56 N. 50.03 W. A secondary terminal located approximately 18 miles north-northwest of the Ras Tanura Terminal and 7 miles offshore, with six single-point moor-ing berths for deep-water loading of tankers up to 700,000 dwt and a storage terminalwith capacity of 17.5-million barrels.


ARABIAN MEDIUM ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31.8 Sulfur Content % Weight 2.45Barrels /Metric Ton 7.27 Pour Point Temp. C -5Viscosity Centistokes 54.1 Reid Vapor Press. Lbs/Sq. In. 7.9(Kinematic) at 100 F Hydrogen Sulfide Parts/mill. nil








Residue >600 46.2 52 ResidueSulfur Content % Wt. 4.14Pour Point Temp. F 60Viscosity (Kin) cts 100 F 1406Vanadium Parts/mill. 51


ARABIAN MEDIUM TERM-CONTRACT PRICES, 1988-93

At Port Of Loading In Dollars Per BarrelMonth 1988 1989 1990 1991 1992 1993Jan. $14.40 $14.34 $16.74 $14.55 $13.78 $15.31 Feb. 14.79 15.97 15.38 14.00 14.61 15.40March 15.17 16.56 13.36 14.91 15.54 15.24April 13.93 16.09 12.29 15.19 17.21 14.90May 13.52 15.43 12.27 14.60 17.41 13.94June 12.89 14.98 16.18 14.66 17.49 13.65July 12.09 14.90 21.90 15.66 17.16 12.92Aug. 11.16 15.36 28.29 16.41 17.05 13.19Sept. 10.07 15.81 29.94 17.21 16.68 12.48Oct. 10.24 16.29 28.68 15.84 15.90 11.38Nov. 11.72 17.23 23.93 14.43 15.26 10.97Dec. 13.27 17.40 16.01 13.97 14.97 11.27Volume-weighted average of prices for all major markets.Note: More recent prices can be found in Chapter I.


ARABIAN SUPER LIGHT Saudi Arabia

Gravity: 50.6 Sulfur: 0.04 Loading Port: YanbuOther Names: Arabian Ultra Light

Production

Commercial output began in late 1994 from the Hawtah, Ghinah, Hazmiyah, and otherfields in central Arabia south of Riyadh. Production of about 200,000 barrels a day is fedinto the Petroline pipeline system for export from Yanbu.

Quality

An unusually light, sweet crude oil for the Mideast. Similar to top gasoline crude oils suchas US West Texas Intermediate and Algerian Saharan. The grade typically competes withYemen Marib and condensates in the Asia-Pacific market.

Producers



Sales are mainly to Asia-Pacific customers on a term-contract basis, with pricing setaccording to a formula tied to the average of Oman and Dubai spot prices. The gradehas been difficult to market at times, and has few regular buyers in the Atlantic Basin.Japanese refiners import about 40,000 b/d.

Sellers

Saudi Aramco and its affiliate, Saudi Petroleum International, are exclusive term-contractsellers. SPI is responsible for Atlantic Basin crude oil sales, and it also has offices inLondon, Singapore, and Tokyo.



Loading Port

Yanbu. 23.57 N. 38.13 E. King Fahd Port at Madinat Yanbu Al Sinaiyah is the main indus-trial port on the Red Sea. The crude oil terminal serves as a loading facility for the 48-inch Petroline crude oil pipeline from Abqaiq in the Eastern Province. Total crude oilstorage is 11-million barrels, with three loading berths able to handle vessels up to500,000 deadweight tons.


ARABIAN SUPER LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 50.6 Sulfur Content % Weight 0.04Barrels /Metric Ton 8.1 Pour Point Temp. C <-20Viscosity Centistokes 30.7 Reid Vapor Press. Lbs/Sq. In. 8.4(Kinematic) at 100 F Hydrogen Sulfide Parts/mill. nil







Int. Gas Oil 500-600 11 11.7 Intermediate Gas OilSulfur Content % Wt. 0.03Cetane Index 60.5

Residue >600 22.3 25.3 ResidueSulfur Content % Wt. 0.07Pour Point Temp F 75Viscosity (Kin) cts 100 F 31.2Vanadium Parts/mill. <1



MUBARAK Sharjah

Gravity: 38.2 Sulfur: 0.57 Loading Port: MubarakOther Names: Mubarek

Production

About 17,000 barrels a day from a mature offshore field discovered in 1972, with peakproduction of 60,000 b/d in the 1970s. Liquids output has been enhanced by increasedgas production since 1992, which has boosted the recovery of condensates, which makeup about two-thirds of the liquids output.

Quality

The initial crude oil and condensate stream was quite light and low in sulfur for theMideast, making it similar to high-quality Abu Dhabi and Qatar grades. The assay belowprecedes the increase in gas output and processing in the early 1990s, and thus it is heav-ier than the actual liquids exports, which contain a much larger share of condensate.

Producers

Sharjah-based Crescent Petroleum is the exclusive producer. The firm was originallyowned by a group of US independent oil firms.


Sold mainly to the Asia-Pacific region under term contracts. Crescent Petroleum also hasdownstream refining interests in Pakistan.

Sellers

Crescent Petroleum: P.O. Box 211, Sharjah, UAE. Tel. (971-6) 284-004. Fax: (971-6)284-007.

Crescent UK: 15 Grosvenor Crescent, London SW1X 7EE, UK. Tel.: (44-171) 235-5500, Fax: (44-171) 245-6666.

Loading Port

Mubarak. 25.49 N. 55.11 E. Located off the island of Abu Musa, the Mubarak terminalhas a single-buoy mooring berth that is designed for tankers of up to 350,000 deadweighttons.


MUBARAK ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 38.2 Sulfur Content % Weight 0.57Barrels /Metric Ton 7.551 Pour Point Temp. C -6Viscosity Centistokes 4.27 Reid Vapor Press. Lbs/Sq. In. 4.8(Kinematic) at 20 C


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 1.9 1.2 LPGLight Naphtha <85 9 7.3 Light Naphtha









Pour Point Temp. C/F 36/96.8Viscosity (Kin) Cen at 60 C 52.9Asphaltenes % Wt. 0.2Vanadium Parts/mill. 3



SHARJAH CONDENSATE Sharjah

Gravity: 50.0 Sulfur: 0.08 Loading Port: Hamriyah Terminal

Production

About 40,000 barrels a day of condensate from the onshore Saaja, Moveyeid, and Kahaiffields, which produce natural gas for use in the United Arab Emirates and condensate forexport.

Quality

An extremely light condensate with a wide naphtha yield that is good for making petro-chemicals.

Producers

Amoco is the operator and sole equity holder in the fields.


The condensate is sold primarily to the Far East, especially to Japan and South Korea.Small volumes have also been exported to the Atlantic Basin.

Sellers

Amoco Shipping & Trading Ltd.: 140 Park Lane, Suite 23, London W1Y 3AA, UK.Tel.: (44-171) 408-1750, Fax: (44-171) 409-0785.

Loading Port

Hamriyah. 25.34 N. 55.24 E. The terminal consists of a single-point mooring loading sys-tem located offshore in the Mideast Gulf that is fed by a 500,000-barrel storage facility.


SHARJAH CONDENSATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 50 Sulfur Content % Weight 0.08Barrels /Metric Ton 8.074 Pour Point Temp. C -24Viscosity Centistokes 1.34 Reid Vapor Press. Lbs/Sq. In. 13.5(Kinematic) at 20 C






Freezing Point Temp. C -52Light Gas Oil 235-300 12 13 Light Gas Oil



Cetane Index 49.9Year Of Crude Oil Sample: 1985 Viscosity (Kin) 60 C 8.34


SOUEDIEH Syria

Gravity: 24.0 Sulfur: 4.05 Loading Ports: Tartous, BaniyasOther Names: Suwaidiyah

Production

The seven fields in northeastern Syria that make up Souedieh total 150,000 barrels a dayof production. On average, roughly one-third of this volume is exported, with the restused in domestic refineries.

Quality

The heavier of Syria�s two export crude oil streams is extremely high in sulfur, whichlimits its market outlets. It is similar to the heaviest Egyptian and Venezuelan oils and toMexican Maya grade. Quality sometimes varies.

Producer

State Syrian Petroleum Co. is the exclusive producer and marketer.


Souedieh is sold into the Mediterranean market on a term-contract basis. Prices are seton a monthly basis versus a dated Brent marker. One interesting twist with Syrian mar-keting is that customers have the option to not lift on a particular month if the price isnot to their liking. But they are responsible for lifting a given quantity over a 12-monthperiod. Sales are sensitive to high-sulfur fuel oil markets, and customers are mainlyMediterranean and southern European refiners including Total, Isab, Agip, OMV, Repsol,Chevron, Conoco, and traders Glencore Rich and Bayoil.

Seller

Syrian Petroleum Co.: Sytrol, Al-Mutanabi St., P.O. Box 2849, Damascus, Syria. Tel.:(963) 227-007.

Loading Ports

Tartous. 34.53 N. 35.45 E. The Tartous terminal, located on the Mediterranean coastabout 90 miles north of Beirut, has two crude oil-loading berths for tankers of up to100,000 deadweight tons and maximum draft of 68 feet.Baniyas. 35.14 N. 35.56 E. The port lies north of Tartous on the Mediterranean andincludes three crude oil-loading berths with maximum draft of 40-52 ft, depending onthe season, and maximum vessel length of 800-950 ft.


SOUEDIEH ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 24 Sulfur Content % Weight 4.05Barrels /Metric Ton 6.92 Pour Point Temp. C -30Viscosity Centistokes 68.7 Reid Vapor Press. Lbs/Sq. In. 4.4(Kinematic) at 20 C Hydrogen Sulfide Parts/mill. 130


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLPG 1.6 1 LPGLight Naphtha <85 7.1 5.1 Light Naphtha







Cloud Point Temp. C -3Cetane Index 47Viscosity (Kin) Cen at 40 C 5.95




SOUEDIEH TERM-CONTRACT PRICES, 1988-93

Prices At Port Of Loading In Dollars Per BarrelMonth 1988 1989 1990 1991 1992 1993Jan. $13.08 $13.96 $17.80 $10.60 $12.11 $12.79 Feb. 12.66 13.82 16.30 6.50 11.77 12.83March 12.24 14.90 14.85 6.05 11.69 13.36April 13.83 16.37 12.50 13.15 13.45 13.32May 13.42 15.77 12.35 13.15 15.24 13.19June 12.63 14.82 11.10 12.15 16.10 12.28July 12.17 14.81 13.75 13.30 15.44 11.78Aug. 12.27 14.45 23.70 13.55 15.12 11.84Sept. 11.42 15.39 29.85 14.40 15.65 11.19Oct. 10.38 16.80 22.15 16.39 15.22 11.43Nov. 11.43 17.40 19.45 14.56 14.03 9.86Dec. 12.92 18.27 15.00 12.23 13.08 8.51Note: More recent prices can be found in Chapter I.


SYRIAN LIGHT Syria

Gravity: 36.5 Sulfur: 0.66 Loading Ports: Tartous, BaniyasOther Names: Syrian Export Blend

Production

Output of about 450,000 barrels a day comes from the Deir ez-Zor fields, which lie inthe east of the country near the Euphrates River. About 300,000 b/d is exported. Theoriginal Thayyem field discovery in the mid-1980s has since been supplemented by sev-eral more fields including Omar, Al-Izba, Tayani, Tanak, Al-Isba, Qahar, Jafra, and oth-ers.

Quality

A light crude oil that is higher in sulfur than most North African grades, and thus tendsto compete with Russian and lighter Saudi and Iranian crude oils in the Mediterraneanmarket. The test below is based on the Thayyem field, and the blend is now somewhatlighter.

Producers

Production of the various fields is in the hands of several foreign companies as well asstate Syrian Petroleum Co. Among the international production-sharing partners areRoyal Dutch/Shell, Deminex, and Elf.


Syrian Light is regularly traded in the Mediterranean spot market, but it is sold mainlyunder term contracts by SPC�s Sytrol unit to both traders and refiners before being resoldin the spot market. SPC�s efforts to reduce spot trading have been largely unsuccessful,but it no longer relies on spot sales tenders. SPC�s monthly price formula is linked todated Brent prices. The grade rarely leaves the Mediterranean. All exports are handledby Sytrol, with equity producers forced to sell their output to SPC, which uses about150,000 b/d for its domestic refineries. Key customers include: BP, Elf, Total, Agip, OMV,Repsol, Tupras, Glencore, Exxon, Mobil, Chevron, Texaco, Veba, and Conoco.

Seller

Syrian Petroleum Co.: Sytrol, Al-Mutanabi St., P.O. Box 2849, Damascus, Syria. Tel.:(963) 227-007.

Loading Ports

Tartous. 34.53 N. 35.45 E. The Tartous terminal, located on the Mediterranean coastabout 90 miles north of Beirut, has two crude oil-loading berths for tankers of up to100,000 deadweight tons and maximum draft of 68 feet.Baniyas. 35.14 N. 35.56 E. The port lies north of Tartous on the Mediterranean andincludes three crude oil-loading berths with maximum draft of 40-52 ft, depending onthe season, and maximum vessel length of 800-950 ft.


SYRIAN LIGHT ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.4 Sulfur Content % Weight 0.66Barrels /Metric Ton 7.426 Pour Point Temp. C 4Viscosity Centistokes 5.72 Reid Vapor Press. Lbs/Sq. In. 4.6(Kinematic) at 20 C





Kerosine 165-235 13.2 12.5 Kerosine329-455 Freezing Point Temp. C -53








SYRIAN LIGHT TERM-CONTRACT PRICES, 1990-93

At Port Of Loading In Dollars Per BarrelMonth 1990 1991 1992 1993Jan. $20.87 $23.65 $17.82 $16.93 Feb. 19.27 19.55 17.37 17.92March 17.88 19.10 17.18 17.99April 15.71 18.75 18.59 17.97May 15.80 18.65 19.60 17.62June 14.73 17.45 20.31 16.58July 17.58 18.80 19.41 15.77Aug. 27.84 19.05 19.04 15.76Sept. 37.76 19.90 19.67 15.21Oct. 36.30 21.89 19.72 15.37Nov. 33.01 20.06 18.60 13.95Dec. 27.80 17.73 17.58 13.81Note: More recent prices can be found in Chapter I.


BRENT BLEND United Kingdom

Gravity: 38.3 Sulfur: 0.37 Loading Port: Sullom VoeOther Names: Ninian (included in Brent system from August 1990)

Production

Output of about 775,000 barrels a day in 1995-96 makes it the second largest UK crudeoil stream after Forties. Output comes from the commingling of the Brent (475,000 b/d)and Ninian (300,000 b/d) systems. Output from most fields in the system is stable ordeclining, and flows are projected to drop to 500,000 b/d by 2000. The main fields ofthe Brent system are Brent, Cormorant, Hutton, Thistle, Murchison (22% Norwegian), andDunlin. The main fields of the Ninian system are Ninian, Alwyn North, and Magnus.

Quality

Typical high-quality, light, low-sulfur North Sea crude oil.

Producers

Production is divided among several international oil companies, with Shell and Exxonholding the largest stakes in the Brent fields, while Chevron and British Petroleum retainlarge shares in Ninian and Magnus. Other companies with sizable interests includeConoco, Amoco, and Enterprise, with many other smaller partners.


Brent is a key international spot market benchmark grade, and it is also traded exten-sively on a forward basis. The International Petroleum Exchange trades Brent crude oilfutures as well. Although producing companies often keep some of the crude oil for theirinternal refining systems, almost all of the rest is traded on a spot basis, with virtually noformal term contracts (for more on Brent, see pB9-B15).

Sellers


Esso UK PLC: Esso House, Victoria St., London SW1 E5JW, UK. Tel.: (44-171) 834-6677, Fax: (44-171) 245-2556.

Chevron UK Ltd.: 2 Portman St., London W1H 0AN, UK. Tel.: (44-171) 487-8100,Fax: (44-171) 487-8142.

Main Customers

The crude oil is primarily refined in Northwest Europe, but depending on arbitrageopportunities, significant volumes often move to the US Gulf and East coasts, as well asto the Mediterranean.

Loading Port

Sullom Voe. 60.27 N. 01.17 W. Sullom Voe, a major deep-water harbor, is the loadingterminal for oil flowing through the Brent and Ninian pipelines from a group of oil fieldsin the East Shetland Basin. Four crude oil-loading berths are available for tankers rang-ing in size from 18,000-350,000 deadweight tons. The maximum allowed draft rangesfrom 15.9 meters at Jetty No. 1 to 22.6 m at Jetties 3 and 4.


BRENT BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 38.3 Sulfur Content % Weight 0.37Barrels /Metric Ton 7.56 Pour Point Temp. C 0Viscosity Centistokes 5.82 Reid Vapor Press. kPa 61.2(Kinematic) at 20 C Total Acid mg KOH/g 0.05


Product Temp. C % Vol. % Wt. Properties Unit ValueLPG 4.71Light Naphtha <90 4.43 3.85 Light Naphtha







Residue >375 32.2 36.35 ResidueSulfur Content % Wt. 0.82Pour Point Temp. C 36Viscosity (Kin) Cen at 50 C 196Asphaltenes % Wt. 1.2Conradson Carbon R % Wt. 4.4Vanadium Parts/mill. 14


BRENT PRICES, 1979-93At Port Of Loading In Dollars Per BarrelMonth 1979 1980 1981 1982 1983 1984 1985 1986Jan. $15.70 $29.75 $39.25 $35.25 $33.50 $29.60 $27.25 $25.75 Feb. 15.70 33.75 39.25 35.10 30.50 29.60 26.75 19.70March 15.70 33.75 39.25 31.10 30.00 29.60 27.00 13.85April 18.25 34.25 39.25 31.10 30.00 29.60 28.25 12.50May 18.25 36.25 39.25 31.10 30.00 29.60 27.40 14.20June 20.70 36.25 35.00 33.50 30.00 29.60 26.10 11.85July 23.25 36.25 35.00 33.50 30.00 29.60 26.50 9.45Aug. 23.25 36.25 35.00 33.50 30.00 29.60 27.00 13.65Sept. 23.25 36.25 35.00 33.50 30.00 29.60 27.60 14.20Oct. 23.25 36.25 35.00 33.50 29.60 28.65 27.90 13.80Nov. 26.02 36.25 36.60 33.50 29.60 28.65 28.60 14.55Dec. 26.02 36.25 36.60 33.50 29.60 28.65 29.25 15.90Month 1987 1988 1989 1990 1991 1992 1993Jan. $18.40 $16.85 $17.00 $21.30 $23.60 $18.15 $17.40 Feb. 17.30 15.75 16.65 19.80 19.50 18.10 18.45March 17.90 14.75 18.70 18.35 19.05 17.60 18.75April 18.10 16.60 19.75 16.50 19.15 18.95 18.65May 18.75 16.40 18.35 16.35 19.15 19.90 18.50June 18.85 15.55 17.50 15.10 18.15 21.15 17.65July 19.80 14.90 17.50 17.25 19.40 20.25 16.80Aug. 18.95 14.95 16.75 27.20 19.75 19.75 16.70Sept. 18.35 13.30 17.75 34.85 20.50 20.25 16.00Oct. 18.80 12.45 18.90 36.00 22.20 20.30 16.60Nov. 17.80 13.00 18.70 33.15 21.25 19.20 15.15Dec. 17.10 15.15 19.90 28.25 18.40 18.15 13.60

Official term-contractprices through 1984,spot prices thereafter.Note: More recentprices can be foundin Chapter I.


CAPTAIN United Kingdom

Gravity: 19-21 Sulfur: 0.5 Loading Port: Captain FPSO

Production

A 60,000 barrel a day first phase of production is due to start in late 1996, and work isexpected to begin soon thereafter on developing the second phase if flow rates are sat-isfactory. The offshore field produces to a floating production, storage, and off-loadingvessel (FPSO).

Quality

An unusually heavy crude oil for the North Sea, but relatively low in sulfur for such aheavy crude oil.

Producers

Texaco is the operator, with the 85% remaining held by a South Korean consortium com-prised of Pedco and Hanwha Energy.


The grade is expected to be priced at a discount to benchmark Brent grade but somelinkage to fuel oil markets is also possible. Texaco is considering selling at least some ofthe grade directly into the fuel oil market because it requires little or no processing tobe used directly as fuel oil. Sales to refiners in Europe and the US are also likely.

Main Sellers

Texaco Oil Trading Co.: 1 Knightsbridge Green, London SW1X 7QJ, UK. Tel.: (44-171) 584-5000, Fax: (44-171) 589-2877.

Loading Port

Captain FPSO. Located 90 miles northeast of Aberdeen in the North Sea, the crude oilis produced to the FPSO�s 550,000 barrel storage tanks. It is then loaded onto dedicatedshuttle tankers.


CAPTAIN ASSAY

No assay available.


FLOTTA United Kingdom

Gravity: 35.4 Sulfur: 1.22 Loading Port: Flotta

Production

A blend from the Piper, Claymore, Scapa, Tartan, Highlander, Petronella, Rob Roy,Ivanhoe, Saltire, Chanter, and Hamish fields in the central North Sea. Production wasseriously disrupted in mid-1988 by an explosion at the Piper field that shut flows fromthe Piper cluster of fields for several years and forced other output to be reroutedthrough the Claymore field. Production, which was fully restored in 1992 and has beendeclining gradually since 1993, averages about 250,000 barrels a day in early 1996.

Quality

Heavier and higher in sulfur than most North Sea oils, Flotta is closer to a Mideast lightcrude oil or Russian Urals grade. Loss of Piper output lowered the gravity of the blendslightly. The assay below is based on full Piper production prior to the accident, and thusit is fairly representative of current output.

Producers

Elf and Enterprise along with Texaco, Lasmo, Deminex, and Amerada Hess have thelargest shares of production. The Amerada Hess and Deminex shares have grown inrecent years with new fields, while the restarting of Piper production significantly boost-ed the Elf, Enterprise, and Lasmo shares.


The grade is either kept in the refining systems of producing companies or sold on thespot market. It is priced at a discount to benchmark Brent grade in line with deliveredprices of Mideast grades or Russian Urals crude oil. Most of the production is used inEurope.

Main Sellers

Elf Trading S.A. Geneva: P.O. Box 532, 1215 Geneva 15 Airport, Switzerland. Tel.:(41-22) 798-1211, Fax: (41-22) 798-3812.

Enterprise Oil PLC: 5 Strand, London WC2N 5HU, UK. Tel.: (44-171) 930-1212.Texaco Oil Trading Co.: 1 Knightsbridge Green, London SW1X 7QJ, UK. Tel.: (44-

171) 584-5000, Fax: (44-171) 589-2877.Amerada Hess Ltd.: 2 Stephen St., Tottenham Court Road, London W1P 1PL, UK.

Tel.: (44-171) 636-7766, Fax: (44-171) 927-9799.Lasmo PLC: 100 Liverpool St., London EC2M 2BB, UK. Tel.: (44-171) 945-4500.

Loading Port

Flotta. 58.53 N. 03.05 W. Flotta terminal, located in the Orkney Islands, has crude oil-loading facilities at both single-buoy mooring and jetty berths. Crude oil-storage capaci-ty at the terminal is 7-million barrels. Two pillar-type SBMs are available for loadingtankers between 35,000-200,000 deadweight tons. The liquefied petroleum gas/crude oiljetty accommodates tankers from 4,000-150,000 dwt.


FLOTTA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 35.4 Sulfur Content % Weight 1.22Barrels /Metric Ton 7.426 Pour Point Temp. C -9Viscosity Centistokes 4.58 Reid Vapor Press. Lbs/Sq. In. 8.1(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1











Pour Point Temp. C/F 33/91.4Viscosity (Kin) Cen at 60 C 94.8

Year Of Crude Oil Sample: 1980 Asphaltenes % Wt. 1.1


FORTIES United Kingdom

Gravity: 40.1 Sulfur: 0.34 Loading Port: Hound Point

Production

Output has risen rapidly with the addition of eight new fields since 1992, which havedoubled total production to 975,000 b/d, making Forties the largest crude oil stream inthe UK. New fields include Scott, Nelson, Everest/Lomond, Brae East, Bruce, Tiffany, andToni. Prior to the new fields, production came mainly from the Forties, Brae, Miller,Arbroath, and Balmoral fields. Output is piped onshore at Cruden Bay, Scotland, andthen transported by pipeline to Hound Point for loading.

Quality

Typical high-quality, light, low-sulfur North Sea crude oil comparable to benchmarkBrent Blend. The grade has improved significantly in quality as new fields and conden-sate flows have come on stream.

Producers

Production has been dominated by British Petroleum, but the total number of equity pro-ducers has expanded to over 40 due in part to rising production. After BP, which hasabout 22% of production, the next biggest producers are Enterprise with 10%, Marathonwith 8%, Amerada Hess with 7%, and Agip with 4%.


Forties is usually priced at a slight premium to benchmark Brent Blend, reflecting bothits slightly higher refined value to most refiners and its relative scarcity in the marketcompared to Brent. While the spot market has become more liquid with rising produc-tion, Forties has yet to take on any marker role despite its larger output than Brent. BPkeeps significant volumes within its own refining system, including almost 200,000 b/dfor its Grangemouth, UK, refinery. This limited the volumes available for spot sales inthe past.

Sellers

BP Oil International Ltd.: Britannic House, 1 Finsbury Circus, London EC2M 7BA,UK. Tel.: (44-171) 496-4000, Fax: (44-171) 496-2854.

Enterprise Oil PLC: Grand Buildings, Trafalgar Square, London WC2N 5EJ, UK. Tel.:(44-171) 925-4000. Fax: (44-171) 925-4321.

Marathon International Petroleum: Marathon House, 174 Marylebone Road,London NW1 5AT, UK. Tel. (44-171) 486-0222. Fax: (44-171) 486-5570.

Amerada Hess Ltd.: 2 Stephen St., Tottenham Court Road, London W1P 1PL, UK.Tel.: (44-171) 636-7766, Fax: (44-171) 927-9799.

Agip (UK) Ltd.: Southside 105 Victoria Street SW1E 6QU, UK. Tel.: (44-171) 344-6000.Fax: (44-171) 344-6175.

Loading Port

Hound Point. 56.00 N. 03.22 W. The Hound Point terminal is a sea island in the Firthof Forth situated about 13 miles from Fairway Buoy. Size restrictions allow for up to300,000 deadweight tons at jetty one and 150,000 dwt at jetty two, depending on sea-sonal tides. Storage is available for 4-million barrels of crude oil.


FORTIES ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 40.1 Sulfur Content % Weight 0.34Barrels /Metric Ton 7.64 Pour Point Temp. C <0

Total Acid mg KOH/g <0.2


Cut Points YieldProduct Temp. C % Wt. Properties Unit ValueLPG 3.15 LPGNaphtha <165 28.61 NaphthaKerosine 165-230 11.85 KerosineGas Oil 230-350 22.97 Gas Oil

Sulfur Content % Wt. 0.23Cloud Point Temp. C -15

Residue >350 33.42 ResidueSulfur Content % Wt. 0.9Carbon Residue % Wt. 4.3Viscosity (Kin) Cen at 80 C 26

Year Of Crude Oil Sample: 1994 Vanadium + Nickel Parts/mill. 7

FORTIES PRICES, 1978-93

At Port Of Loading In Dollars Per BarrelMonth 1978 1979 1980 1981 1982 1983 1984 1985Jan. $13.70 $15.50 $29.75 $39.25 $36.70 $33.50 $29.90 $27.75 Feb. 13.70 15.50 33.75 39.25 35.00 30.50 29.90 28.50March 13.70 15.50 33.75 39.25 31.10 29.75 29.90 28.05April 13.64 18.30 34.25 39.25 31.10 29.75 29.90 27.75May 13.64 21.00 36.25 39.25 31.10 29.75 29.90 27.40June 13.64 20.70 36.25 35.55 33.50 29.75 29.90 26.00July 13.74 23.20 36.25 35.55 33.50 29.75 29.90 26.35Aug. 13.74 23.20 36.25 35.55 33.50 29.75 29.90 26.80Sept. 13.74 23.20 36.25 35.55 33.50 29.75 29.90 27.50Oct. 14.00 23.20 36.25 35.55 33.50 29.90 28.55 27.80Nov. 14.00 26.02 36.25 36.90 33.50 29.90 28.55 28.50Dec. 14.00 26.02 36.25 36.90 33.50 29.90 28.55 29.10Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $25.55 $18.30 $16.65 $17.00 $21.20 $23.65 $18.35 $17.40 Feb. 19.50 17.20 15.60 16.08 19.65 19.60 18.30 18.60March 13.50 17.80 14.60 18.65 18.20 19.10 17.75 18.85April 12.20 18.00 16.35 20.20 16.35 19.10 19.15 18.70May 14.10 18.55 16.15 18.60 16.25 19.20 20.10 18.30June 11.70 18.75 15.45 17.55 15.00 18.25 21.30 17.55July 9.35 19.70 14.80 17.55 17.15 19.55 20.30 16.85Aug. 13.50 18.85 14.75 16.70 27.30 19.95 19.75 16.80Sept. 14.10 18.20 13.10 17.70 35.30 20.70 20.20 15.85Oct. 13.65 18.60 12.30 18.80 35.85 22.45 20.35 16.40Nov. 14.40 17.60 12.85 18.60 32.95 21.45 19.25 15.05Dec. 15.75 16.90 15.20 19.80 28.10 18.55 18.20 13.55Term-contract prices through 1984, spot prices thereafter. Note: More recent prices can be found in Chapter I.


LIVERPOOL BAY United Kingdom

Gravity: 43.3 Sulfur: 0.24 Loading Port: Liverpool Bay Platform

Production

A blend from the Lennox and Douglas fields in the Irish Sea off the west coast ofEngland, which began production in early 1996. The fields have a total capacity of 70,000barrels a day, but problems with the gas injection system at the Lennox field have limit-ed flows to the 40,000 b/d Douglas field pending repairs expected in late 1996.

Quality

A light, sweet crude oil but higher in mercaptans than most North Sea crude oils, whichhas made for some handling problems that tend to restrict sales outlets.

Producers

BHP Petroleum is the operator with 46%. Its partners are Lasmo (25%), Monument (20%),and Powergen (9%).


The crude oil is priced at a differential to benchmark Brent grade, and a significantamount has been committed in term contracts, due to quality constraints.

Main Sellers

BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, VIC3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices:London: (44-171) 408-7116; Singapore: (65) 539-8410; Houston: (713) 961-8668; Tokyo:(813) 5251-1371.

Lasmo PLC: 100 Liverpool St., London EC2M 2BB, UK. Tel.: (44-171) 945-4500.

Loading Port

Liverpool Bay. 53.41 N. 03.32 W. Liverpool Bay crude oil is produced into an 850,000barrel storage barge located adjacent to the platform. It can accommodate tankers up to150,000 deadweight tons.


LIVERPOOL BAY ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 43.3 Sulfur Content % Weight 0.24Barrels /Metric Ton 7.78 Pour Point Temp. C -18Viscosity Centistokes 7.21 Reid Vapor Press. Lbs/Sq. In. 4.5(Kinematic) at 20 C Total Acid mg KOH/g 0.06


Cut Points YieldProduct Temp. C/F % Vol. % Wt. Properties Unit ValueLight Naphtha <70 8 6.6 Light Naphtha

<158 Octane RON 68Paraffins % Wt. 94Naphthenes % Wt. 6Aromatics % Wt. <0

Int. Naphtha 70-140 16.2 14.8 Int. Naphtha158-284 Paraffins % Wt. 51.2

Naphthenes % Wt. 47.4Aromatics % Wt. 1.4


Freezing Point Temp. C -51Gas Oil 250-360 21.1 21.8 Gas Oil

482-680 Sulfur Content % Wt. 0.23Cloud Point Temp. C 0Cetane Index 65Pour Point Temp. C -3

Residue >360 31.7 35.1 ResidueSulfur Content % Wt. 0.37Pour Point Temp. C 42Viscosity (Kin) Cen at 70 C 21.6Asphaltenes % Wt. 0.05

Year Of Crude Oil Sample: 1996 Conradson Carbon R % Wt. 12.9


ALASKAN NORTH SLOPE United States

Gravity: 27.5 Sulfur: 1.16 Loading Port: ValdezOther Names: ANS

Production

The stream amounted to about 1.45-million barrels a day, or about 22% of US output in1996, as compared to a peak of almost 2-million b/d or 25% of national output in 1988.It is a blend from all fields on the northern coast of Alaska. The largest field is PrudhoeBay, which began production in 1977, and is operated jointly by British Petroleum andArco. It is a mature field with an expanded gas-reinjection program designed to slow thenatural output slide. Arco-operated Kuparuk River produced about 270,000 b/d, and BP-operated Endicott produced 70,000 b/d in 1996. Both are heavier crude oils thanPrudhoe Bay. Other fields are Arco-operated Lisburne (200,000 b/d) and BP-operatedMilne Point. The large fields are mature and declining.

Quality

Although heavy, ANS is relatively low in sulfur and has good upgrading properties. Thegrade is considered similar to Arabian Light and Mexican Isthmus.

Producers

Prudhoe Bay: BP 50.684%, Arco 21.779%, Exxon 21.777%, Mobil 1.891%, Phillips1.88%, and less than 1% each to Chevron, Texaco, Amerada Hess, Shell, Marathon, andLouisiana Land & Exploration.

Kuparuk River: Arco 56.167%, BP 39.192%, Unocal 4.951%, and others.Endicott: BP 56.782%, Exxon 21.020%, Unocal 10.517%, and others.Lisburne: Arco 40%, Exxon 40%, BP 20%.Milne Point: BP 72.149%, Chevron 17.373%, Occidental 10.477%.


Moved via the 2-million b/d Trans-Alaska Pipeline from the North Slope to the port ofValdez on the southern coast of Alaska. From there it goes to US refiners on the WestCoast and to Asian refiners. The lifting of the US ban on exports in 1996 brought an endto shipments to the US Gulf Coast, where ANS was once a market crude oil. Exports toAsia amounted to about 100,000 b/d in late 1996. Most producers aside from BP use mostof their supplies in their own downstream refining systems. BP�s term-contract prices inthe US are based on an average of spot prices for the previous month. Export sales aretied to Mideast market grades

Sellers

BP Oil Co.: 200 Public Square, Cleveland, Ohio 44114-2375, USA. Tel.: (216) 586-6923, Fax: (216) 586-6742. Other offices; Long Beach, Calif.: Tel.: (310) 436-4868; andHouston, Texas: Tel. (713) 560-5515.

Loading Port

Valdez. 61.05 N. 146.24 W. Located on the Valdez arm of Prince William Sound, Alaska.Four tanker berths, two with maximum capacity of 265,000 deadweight tons.


ALASKAN NORTH SLOPE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 27.5 Sulfur Content % Weight 1.16Barrels /Metric Ton 7.084 Pour Point Temp. C -6


Product Temp. F % Vol. % Wt. Properties Unit ValueLPG 0-82 1.62 1.03 LPGLight Naphtha 82-200 6.5 5 Light NaphthaInt. Naphtha 200-300 7.49 6.44 Intermediate Naphtha


Kerosine 300-400 7.89 7.14 KerosineSulfur Content % Wt. >0.02

Light Gas Oil 400-500 8.71 8.25 Light Gas OilSulfur Content % Wt. 0.17Cloud Point Temp. F -45Cetane Index 40.02

Int. Gas Oil 500-600 14.79 14.57 Intermediate Gas OilSulfur Content % Wt. 0.7Cloud Point Temp. F 12Cetane Index 45Viscosity (Kin) Cen at 100 F 5.84

Residue >650 52.96 57.56 ResidueSulfur Content % Wt. 1.83Viscosity (Kin) Cen at 122 F 556.1Conradson Carbon R % Wt. 7.93Vanadium Parts/mill. 18


ANS TERM-CONTRACT PRICES AT THE US GULF COAST, 1986-93On A Delivered Basis In Dollars Per BarrelMonth 1986 1987 1988 1989 1990 1991 1992 1993Jan. $25.00 $15.25 $15.50 $14.35 $19.52 $21.20 $16.47 $17.19 Feb. 21.00 16.25 15.50 16.32 20.20 16.08 15.74 16.59March 16.00 16.25 14.75 16.38 19.77 17.71 16.17 17.90April 14.00 17.75 15.50 17.72 18.34 18.16 16.29 18.34May 12.50 17.75 16.25 19.97 15.11 18.16 17.77 18.30June 12.50 18.75 15.50 18.00 14.86 18.01 18.62 17.99July 10.00 18.75 14.81 17.30 13.08 17.58 20.56 17.00Aug. 10.00 19.75 14.34 17.21 16.03 18.30 19.65 15.89Sept. 13.00 19.00 14.15 16.50 32.54 18.49 18.82 16.22Oct. 13.00 18.25 12.92 17.07 32.06 19.05 19.31 15.57Nov. 13.00 18.25 11.85 17.80 29.64 20.05 19.42 16.02Dec. 13.00 16.75 11.70 18.05 25.01 19.16 18.26 14.32

ANS TERM-CONTRACT PRICES AT THE US WEST COAST, 1986-93Month 1986 1987 1988 1989 1990 1991 1992 1993Jan. $24.00 $14.25 $14.50 $13.35 $19.07 $20.62 $14.84 $16.33 Feb. 20.35 15.25 14.50 15.32 20.00 17.53 14.92 15.61March 15.00 15.25 13.75 15.38 19.21 16.90 15.26 16.78April 13.00 16.75 14.50 17.13 17.85 17.55 15.49 17.37May 11.50 16.75 15.25 19.33 14.71 17.55 16.95 18.21June 11.50 17.75 14.50 17.55 14.44 16.73 18.06 17.45July 9.00 17.75 13.81 16.94 13.68 16.33 20.20 16.05Aug. 9.00 18.75 13.34 16.70 15.58 17.32 19.38 14.89Sept. 12.00 18.00 13.15 16.00 32.24 17.18 18.00 15.45Oct. 12.00 17.25 11.92 16.59 31.52 17.31 18.50 15.00Nov. 12.00 17.25 10.85 17.24 28.74 18.52 18.78 15.44Dec. 12.00 15.75 10.70 17.52 23.77 17.56 17.44 13.10Note: More recent prices can be found in Chapter I.


LIGHT LOUISIANA SWEET United States

Gravity: 38.7 Sulfur: 0.13 Pipeline Terminal: St. JamesOther Names: LLS

Production

Reflecting the overall declines in US output, production had dropped to about 600,000barrels a day in 1996. About 60% of this oil is produced from relatively mature offshorefields. Volumes are expected to continue to drop.

Quality

A light, sweet crude oil similar in quality to West texas Intermediate.

Producers

Output comes from a broad range of large integrated oil companies and independentfirms of all sizes, with no one dominant supplier.


The primary outlets are Gulf Coast refiners that rely on the grade as their primary domes-tic feedstock along with Heavy Louisiana Sour (HLS). LLS supplies usually move throughthe pipeline hub of St. James, Louisiana. Some volumes also move north to Midwestrefineries. St. James is a key pricing point because it is the pipeline junction at whichmuch of the production must either move to inland refiners or to plants along the GulfCoast. LLS is traded on a spot basis as ratable daily volumes for delivery over the com-ing month. Term-contract sales occur at prices set by refiners, known as wellhead post-ings. LLS is sometimes used as an alternative market price because it competes moredirectly with imported grades than do WTI or WTS.

Buyers And Sellers

Most Gulf Coast refiners are buyers, and a myriad of producers provide supplies, mak-ing it difficult to single out a few of them.

Pipeline Terminal

St. James. The junction point for pipelines that bring in crude oil from many of the GulfCoast fields and the Louisiana Offshore Oil Port. From St. James, the Capline extendsnorth to Illinois and several other lines serve refineries along the Gulf Coast.


LIGHT LOUISIANA SWEET ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 38.7 Sulfur Content % Weight 0.13Barrels /Metric Ton 7.58 Pour Point Temp. F -25Viscosity Centistokes 3.4(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 1.7 LPGLight Naphtha 55-175 9.8 Light Naphtha

Octane RON Clear Octane 74Int. Naphtha 175-300 13 Intermediate Naphtha



Kerosine 400-500 13 KerosineSulfur Content % Wt. 0.04Freezing Point Temp. F. -43





MARS BLEND United States

Gravity: 31 Sulfur: 2.0 Pipeline Terminal: Clovelly, LOOP

Production

Output began at about 70,000 barrels a day in mid-1996 from the deep-water Mars fieldin the Gulf of Mexico and flows are due to reach 100,000 b/d in 1997 when the field isfully on stream. Output should hit 200,000 b/d or more later in the decade with the addi-tion of Amberjack and possibly other similar sour crude oil streams.

Quality

A medium-gravity sour crude oil that is typical of many of the new fields coming onstream in the deep-water Gulf of Mexico. The assay below comes from just before thestart of commercial production and may not fully reflect actual quality, especially as othercrude oil streams are added in.

Producers

Mars itself is produced by Shell Oil (71.5%) and BP (28.5%). Shell is also the dominantproducer in the Amberjack system.


The grade is expected to trade regularly on a spot basis into the US domestic pipelinesystem. BP is selling all of its output to third parties, and Shell is likely to sell about halfof its share. The grade is considered a potential candidate for a role as a Gulf Coast sourcrude oil benchmark grade if spot trading becomes well established. Initial cargoes havebeen priced at a discount to West Texas Intermediate.

Sellers

Shell Oil Products: One Shell Plaza, 910 Louisiana, Houston, Texas 77002, USA. Tel.:(713) 241-6161. Fax: (713) 241-0004.

BP Oil: 200 Public Square, Cleveland, Ohio 44114-2375, USA. Tel.: (216) 586-5658.Fax: (216) 586-6742.

Pipeline Terminals

Clovelly, LOOP. The Mars field, which lies 130 miles southwest of New Orleans, is con-nected by pipeline to the Clovelly salt dome storage facility that is part of the LouisianaOffshore Oil Port (LOOP). The 3-million barrel facility is dedicated to Mars crude oil andprovides ready access to St. James, Louisiana, and the Capline system to the Midwest, aswell as to other pipeline systems along the Gulf Coast.


MARS BLEND ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31 Sulfur Content % Weight 2Barrels /Metric Ton 7.239 Pour Point Temp. F -33Viscosity SSU 82.8 Reid Vapor Pressure psi 8

at 80 F Hydrogen Sulfide g/100ml 0.0011


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG <68 2.8 LPGLight Naphtha 68-155 6.9 Light Naphtha

Octane RON Clear Octane 68Int. Naphtha 155-265 9 Intermediate Naphtha


Heavy Naphtha 265-350 8 Heavy NaphthaParaffins % Wt. 59Naphthenes % Wt. 25.5Aromatics % Wt. 15.5

Kerosine 350-500 12.9 KerosineSulfur Content % Wt. 0.49Freezing Point Temp. F. -49.6

Gas Oil 500-650 12.7 Gas OilSulfur Content % Wt. 1.28Cetane Index 48.1Pour Point Temp F 0

Residue >650 47.7 ResidueSulfur Content % Wt. 3.24Con. Carbon % Wt. 9.3Viscosity (SSU) At 210F 316.1Vanadium ppm 84

Year Of Crude Oil Sample: 1996 Nickel ppm 34


WEST TEXAS INTERMEDIATE United States

Gravity: 39.6 Sulfur: 0.24 Pipeline Terminals: Cushing, MidlandOther Names: WTI

Production

Due to ongoing declines, only 450,000 barrels a day of light, sweet crude oil productioncomes from districts of West Texas and New Mexico that are specifically designated bythe Texas Railroad Commission and oil companies as West Texas Intermediate. But abroader WTI classification also applies to a range of similar light, sweet crude oils fromother areas of Oklahoma, Texas, and Kansas that are commingled at key pipeline inter-changes. These flows are deliverable at Cushing, Oklahoma, against New York crude oilfutures contracts, and they amounted to about 750,000 b/d in 1996, which is down sub-stantially from 1.36-million b/d in 1985. Most of these fields are mature, and volumes aredeclining with overall output in the lower 48 states.

Quality

A light, sweet crude oil that is excellent for manufacturing gasoline.

Producers

Output comes from a broad range of large integrated oil companies and independentfirms of all sizes, with no one dominant supplier.


The primary outlets are US Midcontinent and Great Lakes refineries that are suppliedmainly from Cushing, Oklahoma. Volumes also go to the Gulf Coast, but these are main-ly the equity production of integrated refiners, rather than freely traded barrels. Midlandis a key pricing point because it is the pipeline junction at which much of the produc-tion must either move to Cushing and the inland refiners or to the Gulf Coast. WTI istraded on a spot basis as ratable daily volumes for delivery over the coming month, andthese �cash� prices track closely with the light, sweet futures contract in New York. Term-contract sales occur at prices set by refiners, known as wellhead postings. These pricestrack New York Mercantile Exchange levels closely, but exclude the cost of moving thegrade from the field to Cushing.

Buyers And Sellers

Most refiners in the Midcontinent and Great Lakes regions of the US are regular buyers,and myriad producers provide supplies, making it difficult to single out a few of them.

Pipeline Terminals

Cushing, Oklahoma. The junction point for pipelines that feed crude oil in from bothWest Texas and the Gulf Coast for transport onward by pipeline to Kansas, Missouri,Iowa, Illinois, and the Great Lakes region.Midland, Texas. The junction point for pipelines that bring in crude oil from West Texasand New Mexico for transport onward by pipeline to either Cushing, Oklahoma, or theGulf Coast.


WEST TEXAS INTERMEDIATE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 39.6 Sulfur Content % Weight 0.24Barrels /Metric Ton 7.615 Pour Point Temp. C -21Viscosity Centistokes 3.73 Reid Vapor Press. Lbs/Sq. In. 5.9(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1






Light Gas Oil 235-300 12 12.1 Light Gas Oil455-572 Sulfur Content % Wt. 0.13





Viscosity (Kin) Cen at 60 C 67.5Asphaltenes % Wt. 0.38Conradson Carbon R % Wt. 3.68Vanadium Parts/mill. 13


WTI WELLHEAD POSTINGS, 1979-93Average Prices Set By Refiners In Dollars Per BarrelMonth 1979 1980 1981 1982 1983 1984 1985 1986Jan. $14.85 $32.50 $38.00 $35.00 $32.00 $30.00 $26.85 $27.00 Feb. 15.85 37.00 38.00 34.00 30.00 30.00 26.70 20.00March 15.85 38.00 38.00 33.00 30.00 30.00 26.85 15.35April 15.85 39.50 38.00 33.00 30.00 30.00 27.15 13.25May 18.10 39.50 38.00 33.00 30.00 30.00 27.30 13.65June 19.10 39.50 36.00 32.00 30.00 30.00 27.20 13.90July 21.75 39.50 36.00 32.00 30.00 30.00 27.05 11.85Aug. 26.50 38.00 36.00 32.00 30.00 29.75 27.15 13.35Sept. 28.50 36.00 36.00 32.00 30.00 29.55 27.35 14.20Oct. 29.00 36.00 35.00 32.00 30.00 29.55 27.50 13.95Nov. 31.00 36.00 36.00 33.00 30.00 28.55 27.65 13.95Dec. 32.50 37.00 35.00 32.00 30.00 28.00 27.80 14.80Month 1987 1988 1989 1990 1991 1992 1993Jan. $17.30 $16.55 $16.95 $21.38 $23.48 $17.61 $17.77 Feb. 17.35 16.40 16.75 21.04 19.39 17.75 18.75March 17.45 15.50 18.30 19.57 18.68 17.80 18.96April 17.50 16.80 19.65 17.65 19.56 19.36 18.87May 18.25 16.95 19.15 17.42 20.12 20.15 18.49June 18.70 16.20 19.05 15.80 18.85 21.50 17.56July 19.80 15.10 19.30 17.22 20.18 20.87 16.19Aug. 19.80 14.75 17.65 26.25 20.43 20.27 17.10Sept. 19.00 14.25 18.50 29.75 20.75 20.57 15.83Oct. 18.85 13.47 19.22 34.77 21.98 20.35 16.56Nov. 18.50 13.05 19.03 30.95 21.18 19.00 15.07Dec. 17.40 14.80 19.87 25.80 18.28 18.08 12.86Note: More recent prices can be found in Chapter I.


WEST TEXAS SOUR United States

Gravity: 34.2 Sulfur: 1.3 Pipeline Terminal: MidlandOther Names: WTS

Production

Due to ongoing declines, only about 750,000-800,000 barrels a day of West Texas Sourproduction is available at the main Midland, Texas, terminal from West Texas and NewMexico. Volumes are expected to continue to drop from these mature fields.

Quality

A medium to light, sour crude oil similar in quality to Arabian Light or Mexican Isthmus.

Producers

Output comes from a broad range of large integrated oil companies and independentfirms of all sizes with no one dominant supplier.


The primary outlets are inland US refineries in the Midwest and Midcontinent regions.These supplies usually move through Cushing, Oklahoma, but most spot trading of WTSoccurs in Midland, Texas. Some volumes still move to the Gulf Coast, but these havebeen backed out by imports as domestic output has declined. Midland is a key pricingpoint because it is the pipeline junction at which much of the production must eithermove to Cushing and the inland refiners or to the Gulf Coast. WTS is traded on a spotbasis as ratable daily volumes for delivery over the coming month. Term-contract salesoccur at prices set by refiners, known as wellhead postings. These values exclude thecost of moving the crude oil from the field to Midland.

Buyers And Sellers

Many refiners in the Midcontinent and Great Lakes regions of the US are regular buyers,and myriad producers provide supplies, making it difficult to single out a few of them.

Pipeline Terminal

Midland, Texas. The junction point for pipelines that bring in crude oil from West Texasand New Mexico for transport onward by pipeline to either Cushing, Oklahoma, or theGulf Coast.


WEST TEXAS SOUR ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 34.2 Sulfur Content % Weight 1.3Barrels /Metric Ton 7.38 Pour Point Temp. F 0Viscosity Centistokes 4.1(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 1.4 LPGLight Naphtha 55-175 7 Light Naphtha









BACHAQUERO Venezuela

Gravity: 13.0 Sulfur: 2.68 Loading Port: Punta Cardon

Production

Volumes come from the Lake Maracaibo region in western Venezuela, the country�s mainproducing area, with the Bachaquero field itself supplying about 250,000 barrels a dayin 1994. It comprises a large share of the country�s 725,000 b/d of heavy crude oilexports.

Quality

An extra-heavy, high-sulfur crude oil with high metals content. The assay below is dated,but it conforms fairly closely to the typical characteristics of the grade as specified bystate PDV.

Producer

Maraven, a 100% government-owned and vertically-integrated affiliate of PDV.


Most of the grade is sold to sophisticated refineries in the US, asphalt plants, or used inPDV�s extensive downstream refining system, which includes 1.17-million b/d of domes-tic refining capacity and over 1.8-million b/d abroad. While PDV still posts prices, salesare usually under term contracts that allow significant variation in both volume and pric-ing for individual customers.

Sellers

All three PDV operating affiliates � Corpoven, Lagoven, and Maraven � are involvedin selling a wide range of export crude oil grades, including their own production andthat of other affiliates.

Corpoven: P.O. Box 61373, Caracas 1060-A, Venezuela. Tel.: (58-2) 708-1411, Fax:(58-2) 708-1646.

Lagoven: P.O. Box 889, Caracas 1010-A, Venezuela. Tel.: (58-2) 661-1011, Fax: (58-2) 606-3637.

Maraven: P.O. Box 829, Caracas 1010-A, Venezuela. Tel.: (58-2) 908-2111, Fax: (58-2) 908-2747.

Loading Port

Punta Cardon. 10.37 N. 70.13 W. The Punta Cardon terminal is the main export pointfor Maraven grades, and it is located on the Paraguana Peninsula in western Venezuela.It has four or more berths capable of loading vessels with a maximum draft of 45 feetand maximum tonnage of 130,000 deadweight tons.


BACHAQUERO ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 13 Sulfur Content % Weight 2.68Barrels /Metric Ton 6.431 Pour Point Temp. C -9Viscosity Centistokes 1,139 Reid Vapor Press. Lbs/Sq. In. 0.4(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1






Freezing Point Temp. C <-61Light Gas Oil 235-300 8 7.3 Light Gas Oil



Cloud Point Temp. C <-60Cetane Index 37.2Viscosity (Kin) Cen at 40 C 11


Pour Point Temp. C/F 30/86Viscosity (Kin) Cen at 60 C 8,455Asphaltenes % Wt. 7.3Conradson Carbon R % Wt. 13.7Vanadium Parts/mill. 530


TYPICAL SPECIFICATIONS FROM PDV, 1992

Specifications Unit Value Specifications Unit ValueGravity (60 F) API 12.8 Sulfur Content % Weight 2.8Viscosity Centistokes 48.6 Pour Point Temp. C -18(Kinematic) at 100 C Vanadium Parts/mill. 442


BCF-17 Venezuela

Gravity: 16.2 Sulfur: 2.47 Loading Port: La Salina

Production

Volumes come from the Lake Maracaibo region in western Venezuela, the country�s mainproducing area. BCF-17 is one of the main grades in the nation�s 725,000 barrels a dayof heavy crude oil exports.

Quality

An extra-heavy, high-sulfur crude oil with high metals content.

Producer

Lagoven, a 100% government-owned and vertically-integrated affiliate of state PDV.


Most of the grade is sold to sophisticated refineries in the US or used in PDV�s extensivedownstream refining system, which includes 1.17-million b/d of domestic refining capac-ity and over 1.8-million b/d abroad. While PDV still posts prices, sales are usually underterm contracts that allow significant variation in both volume and pricing for individualcustomers.

Sellers





Loading Port

La Salina. 10.22 N. 71.27 W. The La Salina terminal is located in Lake Maracaibo in west-ern Venezuela. It has four crude oil-loading berths, all with a maximum draft of 41 feetand maximum tonnage of 135,000 deadweight tons.


BCF-17 ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 16.2 Sulfur Content % Weight 2.47Viscosity Centistokes 509 Pour Point Temp. C 0(Kinematic) at 100 C Vanadium Parts/mill. 352

Typical Specifications From PDV, 1992


BOSCAN Venezuela

Gravity: 10.1 Sulfur: 5.40 Loading Port: Bajo Grande

Production

The Boscan field is located onshore on the west side of Lake Maracaibo in westernVenezuela. It produced about 60,000 barrels a day in 1994.

Quality

An extremely heavy crude oil that is used primarily to manufacture asphalt. The assaybelow is quite old, but it conforms with state PDV�s more recent specifications.

Producer

Maraven, a 100% government-owned and vertically-integrated affiliate of PDV.


Most of the grade is sold to special asphalt refineries in the US or used in PDV�s exten-sive downstream refining system, which absorbs about 100,000 b/d of asphalt crude oilexports, mainly through its Citgo and Nynas affiliates in the US and Europe. PDV�s down-stream system includes 1.17-million b/d of domestic refining capacity and over 1.8-mil-lion b/d abroad, which take about 900,000 b/d of Venezuelan crude oil. The countryexported 925,000 b/d to third-party customers in 1995. While PDV still posts prices, salesare usually under term contracts that allow significant variation in both volume and pric-ing terms for individual customers.

Sellers





Loading Port

Bajo Grande. 10.29 N. 71.38 W. The Bajo Grande terminal, situated about eight milessouth of Maracaibo on the northwestern shore of Lake Maracaibo, is equipped with twoloading jetties. Two crude oil-loading berths are available at the loading pier. Maximumsize and draft for Berths 1 and 2 are 55,000 deadweight tons and 39 feet, and 36,000 dwtand 32 ft, respectively.


BOSCAN ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 9.2 Sulfur Content % Weight 4.99Barrels /Metric Ton 6.259 Pour Point Temp. C 17Viscosity Centistokes 26,200 Reid Vapor Press. Lbs/Sq. In. 2.1(Kinematic) at 100 F









Cloud Point Temp. C -14Cetane Index 39.8Viscosity (Kin) 100 F 9.19


Pour Point Temp. C/F >39/>102.2

Viscosity (Kin) Cen at 210 F 2,150Conradson Carbon R % Wt. 19Vanadium Parts/mill. 1,330



Specifications Unit Value Specifications Unit ValueGravity (60 F) API 10.1 Sulfur Content % Weight 5.4Viscosity Centistokes 11,233 Pour Point Temp. C 7(Kinematic) at 100 C Vanadium Parts/mill. 1,122


FURRIAL Venezuela

Gravity: 30 Sulfur: 1.10 Loading Port: Puerto La CruzOther Names: Amana, Mesa

Production

Some 275,000-300,000 barrels a day are produced from the Furrial field itself in easternVenezuela, which is blended with similar-quality oils from the region. The crude oil hascontributed significantly to the country�s rising output, with total capacity for light crudeoils and condensates of this type standing at 1.3-million b/d in 1995 and expected toexpand further.

Quality

A light crude oil by Venezuelan standards that is relatively low in sulfur, making it sim-ilar in quality to US Alaskan North Slope or Mexican Isthmus.

Producer

Lagoven, a 100% government-owned and vertically-integrated affiliate of state PDV, pro-duces Furrial. Corpoven, a 100% government-owned and vertically-integrated affiliate ofPDV, produces Mesa, which is virtually identical to Furrial.


The grade is popular with a wide range of customers, mainly in the US market, and hasbeen a key source of growing crude oil exports, which have come mainly from light andmedium gravity crude oils in 1994-96. Exports of these grades rose to almost 1.1-millionb/d in 1995, a rise of 172,000 b/d from 1994. Venezuela crude oil exports are expectedto average 2.1-million b/d in 1996. While PDV still posts prices, sales are usually underterm contracts that allow significant variation in both volume and pricing terms for indi-vidual customers.

Sellers





Loading Port

Puerto La Cruz. 10.14 N. 64.37 W. The Puerto La Cruz terminal is located east of Caracason the Caribbean coast of Venezuela. It is operated by PDV affiliate Corpoven, and hassix tanker-loading berths. The two largest can take a maximum draft of 55 feet and max-imum tonnage of 130,000 deadweight tons.


FURRIAL ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 28.5 Sulfur Content % Weight 1.1Viscosity Centistokes 11.9 Pour Point Temp. C -25(Kinematic) at 100 C Vanadium Parts/mill. 68

Typical Specifications From PDV, 1992


TIA JUANA HEAVY Venezuela

Gravity: 12.3 Sulfur: 2.82 Loading Port: Punta CardonOther Names: Tia Juana Pesado

Production

Although the Tia Juana Heavy field produces about 80,000 barrels a day from the LakeMaracaibo region in the western part of the country, about half of that volume is mixedinto lighter streams, and only 40,000 b/d is sold as is.

Quality

Although the crude oil is extremely heavy and high in metals, it contains less sulfur thanmost grades of this type, and it is known for its ability to yield lubricants and other spe-cialty products such as asphalt.

Producer

Maraven, a 100% government-owned and vertically-integrated affiliate of state PDV.


Most Venezuelan crude oil is sold on a term-contract basis by PDV subsidiaries Lagoven,Maraven, and Corpoven. Of the 40,000 b/d that is not blended with other grades, half ofthat goes into PDV�s Curacao refinery. Along with Pilon, TJ Heavy is particularly popu-lar in the spring and summer, during the height of asphalt-paving season. While PDV stillposts prices, sales are usually under term contracts that allow significant variation in bothvolume and pricing terms for individual buyers.

Sellers

All three PDV operating affiliates � Corpoven, Lagoven, and Maraven � are involvedin selling a wide range of export crude grades, including their own production and thatof other affiliates.




Loading Port

Punta Cardon. 10.37 N. 70.13 W. The Punta Cardon terminal is the main export pointfor Maraven grades, and is located on the Paraguana Peninsula in western Venezuela. Ithas four or more berths capable of loading vessels with maximum draft of 45 feet andmaximum tonnage of 130,000 deadweight tons.


TIA JUANA HEAVY ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 11.7 Sulfur Content % Weight 2.72Barrels /Metric Ton 6.373 Pour Point Temp. C 3Viscosity Centistokes 3,730 Reid Vapor Press. Lbs/Sq. In. 0.1(Kinematic) at 40 C Hydrogen Sulfide Parts/mill. <1









Cloud Point Temp. C <-60Cetane Index 37.5Viscosity (Kin) 40 C 10.7





Specifications Unit Value Specifications Unit ValueGravity (60 F) API 12.3 Sulfur Content % Weight 2.82Viscosity Centistokes 88.6 Pour Point Temp. C -16(Kinematic) at 100 C Vanadium Parts/mill. 386


TIA JUANA LIGHT Venezuela

Gravity: 32 Sulfur: 1.2 Loading Port: La SalinaOther Names: Tia Juana Livano

Production

The Tia Juana Light field was producing about 240,000 barrels a day from the LakeMaracaibo region in the western part of the country in 1994. It is representative of thelighter grades that have increased production significantly in the mid-1990s.

Quality

Although the crude oil is light by Venezuelan standards, it is still fairly sour and corre-sponds to grades such as Mexican Isthmus or Saudi Arabian Light. It is relatively low inmetals and attractive to a wide range of refiners.

Producer

Lagoven, a 100% government-owned and vertically integrated affiliate of state PDV.


Most Venezuelan crude oil is sold on a term-contract basis by PDV subsidiaries Lagoven,Maraven, and Corpoven. While PDV still posts prices, sales are usually under term con-tracts that allow significant variation in both volume and pricing for individual buyers.

Tia Juana Light is an important contributor to the country�s 1.1-million b/d of exportsof light- and medium-grade crude oils, which have accounted for most of the recentexpansion in international sales. Both rising output and increased refinery sophisticationhave allowed more of these higher value crude oils to be exported. Total Venezuelancrude oil exports are expected to reach 2.1-million b/d in 1996.

Sellers





Loading Port

La Salina. 10.22 N. 71.27 W. The La Salina terminal is located in Lake Maracaibo in west-ern Venezuela. It has four crude oil-loading berths, all with a maximum draft of 41 feetand maximum tonnage of 135,000 deadweight tons.


TIA JUANA LIGHT ASSAYSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31.9 Sulfur Content % Weight 1.18Viscosity Centistokes 8.8 Pour Point Temp. C -20(Kinematic) at 100 C Total Acid mg KOH/g 0.22

Typical Specifications from PDV, 1992


BACH HO Vietnam

Gravity: 33.8 Sulfur: 0.08 Loading Port: Bach HoOther Names: White Tiger

Production

Output rose to about 140,000 barrels a day in 1995 as the satellite Rong field came onstream, and volumes were expected to climb further in 1996. Bach Ho was originally dis-covered by Mobil in the 1960s, and production began in 1986, but at a low level due totechnical difficulties.

Quality

Typical low-sulfur, waxy Asian crude oil, similar to Indonesian Minas grade.

Producers

Vietsovpetro, a joint venture between state Petrovietnam and a Russian group with ashareholding of 15.9%.


Virtually all production is sold for export due to limited refining capacity in Vietnam.Most oil is sold on a term-contract basis, mainly to Japan at prices linked to spot quotesfor Minas plus a premium. In mid-1996, the formula was Minas plus 63¢ a barrel. Spotsales usually go to Singapore refiners such as Mobil. In 1995, Japan imported about100,000 b/d.

Sellers

Sales are handled by producer Petrovietnam.Petrovietnam: 7 Mac Dinh Chi Street, 1st District, Ho Chi Minh City, Vietnam. Telex

811488.

Loading Port

Bach Ho. Located at the production platform in the South China Sea off the MekongRiver delta. A new loading facility was installed in 1991, but still subject to delays dur-ing mid-year typhoon season.


BACH HO ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 33.8 Sulfur Content % Weight 0.08Barrels /Metric Ton 7.357 Pour Point Temp. C 33Viscosity Centistokes 16.8 Reid Vapor Press. Lbs/Sq. In. 3.4(Kinematic) at 50 C Hydrogen Sulfide Parts/mill. <1






Freezing Point C -46Light Gas Oil 235-300 10.3 9.9 Light Gas Oil





Pour Point Temp. C/F >45/>113Viscosity (Kin) Cen at 60 C 84.1Asphaltenes % Wt. 0.06Conradson Carbon R % Wt. 5.19Vanadium Parts/mill. <1



MARIB Yemen

Gravity: 48 Sulfur: 0.10 Loading Port: Ras IsaOther Names: Alif

Production

Output has declined from peak levels of over 200,000 barrels a day, but flows recoveredto about 170,000 b/d in 1996 with the inclusion of about 15,000 b/d of new output fromthe Janna block. This new stream and the addition of condensates stripped from associ-ated gas have altered the quality of the stream but have managed to maintain total flows.The main source of crude oil is still the Alif field and others east of Sanaa in former NorthYemen.

Quality

A high-quality, light, sweet crude oil with an excellent gasoline yield, making it similarto top-quality North African crude oils. The crude oil is significantly lighter than indicat-ed by the assay below due to the addition of condensates to the export stream, but thishas also forced it to compete with the growing influx of condensates in Asia-Pacific mar-kets.

Producers

The Alif fields are operated jointly by US independent Hunt and Exxon, and they areheld by state Yominco (47%), Hunt (21%), Exxon (19%), and a South Korean group ledby refiner Yukong (13%).


Most of the grade has been sold under term contracts to both Asia and the Atlantic Basinat prices tied to UK Brent. However, in late 1996, the government�s tough Brent-linkedpricing system resulted in the loss of most of its term sales contracts, forcing it to resortto spot sales. Traditional customers include Japanese and Chinese refiners. About 50,000b/d are used for domestic needs. Exxon markets the Hunt/Exxon volumes, and the SouthKorean group imports its share.

Sellers

Sales are handled both by the equity producers and state Yominco.Yominco: Zubairy St., Sanaa, Yemen. Tel.: (967-2) 71-432.Exxon Trading Co. International: 200 Park Ave., Florham Park, NJ 07932-1002,

USA. Tel.: (201) 765-4922, Fax: (201) 765-4983.

Loading Port

Ras Isa. 15.07 N. 42.36 E. Located off the port of Salif on the Red Sea, the offshore load-ing terminal consists of a dedicated 400,000-deadweight ton storage vessel and loadingfacilities for ships up to 200,000 dwt.


MARIB ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 40.3 Sulfur Content % Weight 0.1Barrels /Metric Ton 7.65 Pour Point Temp. F 25Viscosity Centistokes 2.6(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 2.5 LPGLight Naphtha <175 8.6 Light Naphtha








MARIB TERM-CONTRACT PRICES, 1988-93

At Port Of Loading In Dollars Per BarrelMonth 1988 1989 1990 1991 1992 1993Jan. $16.62 $16.64 $20.87 $23.93 $18.53 $17.79 Feb. 15.90 16.44 19.87 19.74 18.42 18.90March 14.57 18.16 18.47 19.18 17.94 19.14April 16.42 19.67 16.52 19.20 19.33 19.04May 16.30 18.57 16.46 19.17 20.27 18.86June 15.33 18.15 15.23 18.19 21.49 17.98July 14.73 17.57 17.35 19.45 20.61 17.08Aug. 14.80 17.13 27.49 19.84 20.10 17.01Sept. 13.18 18.28 37.60 20.60 20.60 16.31Oct. 12.13 18.95 36.55 22.36 20.65 16.84Nov. 12.55 18.70 33.66 21.08 19.58 15.39Dec. 14.58 19.85 28.70 18.42 18.55 13.84Note: More recent prices can be found in Chapter I.


MASILA Yemen

Gravity: 30.5 Sulfur: 0.62 Loading Port: Ash Shihr

Production

About 175,000 barrels a day was produced in 1996 from a cluster of onshore fields thatlie in former South Yemen, southeast of the Marib producing area, which is in formerNorth Yemen. Masila began producing in the summer of 1993. The grade is transportedby a 200,000 b/d pipeline to the coast for export.

Quality

A medium-gravity, medium-sulfur crude oil, similar in quality to Oman.

Producers

The fields are operated by Canadian Occidental, which holds 52%, along with US Shell�sPecten unit (20%), Occidental (18%), and Consolidated Contractors (10%).


Most of the grade has traditionally been sold under term contracts, mainly to Asia, atprices tied to dated Brent. The government�s 100,000 b/d share of output is marketed bystate Yominco. As with Marib, Yominco has encountered growing difficulty in marketingthe grade to Asia at prices linked to Brent, and was forced to rely much more heavily onspot sales in late 1996. Remaining term customers included refiner Japan Energy andtraders Phibro and Glencore after Exxon and Unocal dropped out. Canadian Oxy, themain equity producer, is also a source of spot barrels. The grade is also sometimesrefined domestically at the Aden refinery. In 1995, Japan imported 30,000 b/d of Masila.

Sellers

Yominco: Zubairy St., Sanaa, Yemen. Tel.: (967-2) 71-432.Canadian Occidental: Canadian Oxy Crude Sales, 1980 Post Oak Blvd., Houston, TX

77056, USA. Tel.: (713) 840-2870, Fax: (713) 840-2834.

Loading Port

Ash Shihr. 14.45 N. 49.34 E. The Masila crude oil export terminal is located on the Gulfof Aden along the Indian Ocean coast of southern Yemen.


MASILA ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 30.5 Sulfur Content % Weight 0.62Barrels /Metric Ton 7.2172 Pour Point Temp. C/F -0.11Viscosity Centistokes 11.09(Kinematic) at 100 F


Cut Points YieldProduct Temp. F % Vol. % Wt. Properties Unit ValueLPG 0.19 0.12 LPGLight Naphtha 90-200 4.36 3.43 Light Naphtha


Int. Naphtha 200-300 9.03 7.88 Intermediate NaphthaParaffins % Wt. 53.5Naphthenes % Wt. 42Aromatics % Wt. 4.2


Kerosine 360-500 13.53 12.67 KerosineSulfur Content % Wt 0.06Freezing Point Temp. C/F 0.90

Gas Oil 500-700 21.48 21.15 Gas OilSulfur Content % Wt. 0.37Cloud Point Temp. C/F -0.07Cetane Index 55.2


Year Of Crude Oil Sample: 1993 Pour Point Temp. C/F 60/140


ZAIRE Zaire

Gravity: 31.2 Sulfur: 0.11 Loading Port: Moanda

Production

The crude oil comprises all of the country�s 30,000 barrels a day of production from bothonshore and offshore fields. Output has edged higher in the mid-1990s and is expectedto increase marginally. The producing area lies between Angola and the Angola-Cabindaenclave.

Quality

A somewhat heavy, but low-sulfur, waxy West African crude oil.

Producers

The offshore fields are owned and operated by Chevron and the onshore fields areowned and operated by Petrofina. Output is divided roughly evenly between onshoreand offshore fields.


The grade is marketed by the equity producers or kept within their own internal refin-ing systems. It is usually priced at a differential to dated Brent less a discount of about$2 a barrel.

Sellers

Chevron International: c/o Mail Centre, 2 Portman St., London W1H 0AN, UK. Tel.:(44-171) 487-8100, Fax: (44-171) 487-8142.

Petrofina: 52 Rue de l�Industrie, B-1040 Brussels, Belgium. Tel.: (32-2) 288-9111. Fax:(32-2) 288-3250.

Loading Port

Moanda. 5.58 S. 12.08 E. The Moanda terminal is a single buoy mooring system that canaccommodate tankers up to 100,000 deadweight tons. The terminal also has a dedicatedstorage tanker. It lies 16 miles offshore, to the west of the main offshore producing area.


ZAIRE ASSAYCrude Oil Crude OilSpecifications Unit Value Specifications Unit ValueGravity (60 F) API 31.2 Sulfur Content % Weight 0.11Barrels /Metric Ton 7.24 Pour Point Temp. F 70Viscosity Centistokes 19.4 Total Acid mg KOH/g 0.21(Kinematic) at 40 C


Cut Points YieldProduct Temp. F % Vol. Properties Unit ValueLPG 1 LPGLight Naphtha <175 3.7 Light Naphtha





Gas Oil 500-650 13.7 Gas OilSulfur Content % Wt. 0.06Cetane Index 54



PPrriicceess


Prices � Spot And Term Contract Prices For Key Grades . . . . . . . . . . . . . . . .I1

Key Crude Oil Benchmarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .I3

Spot Assessments For Various Crude Oil Grades . . . . . . . . . . . . . . . . . . . . . .I5

PIW Scorecard � Costs To Refiners Of Key Formula Priced Crude Oils

In Primary World Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .I11

PIW Scorecard � Term Contract Prices At Port Of Loading . . . . . . . . . . . . .I17

CRUDE OIL HANDBOOK PIW © I1

PPRRIICCEESS ��

SSppoott AAnndd TTeerrmm CCoonnttrraacctt PPrriicceess FFoorr KKeeyy GGrraaddeess

The following tables provide a complete picture of crude oil price trends since

1993, covering both spot prices and term contract prices for all the main grades.

These prices come directly from Petroleum Intelligence Weekly and Oil MarketIntelligence. The first set of tables covers spot crude prices, with the first section

covering the Opec Basket price and nine other major international benchmark

grades. These are followed by spot prices for 46 other grades broken down regionally.All of these spot prices are based on PIW and OMI assessments, which are drawn fromvarious crude oil price reporting services and assessments by PIW reporters. The OpecBasket price is published by Opec and is based on its spot prices or assessments for thefollowing crudes: Algerian Saharan Blend, Indonesian Minas, Nigerian Bonny Light,Saudi Arabia Light, Dubai crude, Venezuelan Tia Juana Light, and Mexican Isthmus.Further spot price history prior to 1993 is provided in many of the individual crude pro-files (see Chapter H).

The coverage of term contract prices is drawn directly from PIW�s regular

quarterly price scorecards, which calculate the final prices and costs of the

crudes based on prevailing formula price terms as well as the prices based on

postings and retroactive pricing mechanisms. The term contract prices are bro-

ken into two sections. The first section looks at the formula prices from the perspec-tive of the buyers, calculating the average cost or price of the crude on a delivered basisto refiners for the month of arrival in each of the main refining centers: Rotterdam, theUS Gulf Coast, and Singapore. The second set of tables looks at the price formulas fromthe perspective of the exporting country and provides prices on an f.o.b. basis for themonth of loading. These tables combine the results of the formula price calculations withthe retroactive pricing, postings, and other pricing mechanisms to provide a compre-hensive view of term contract prices. Further term contract price history prior to 1993 isprovided in many of the individual crude profiles (see Chapter H).


KEY CRUDE OIL BENCHMARKS (In $/barrel)

SPOT BENCHMARKSOpec UK US Nigeria Dubai US Russia Indonesia Malaysia

Basket Brent WTI Bonny Fateh ANS Urals Oman Minas Tapis1996 (Cushing) Light (Gulf Coast) (NWE)Sept. 19.78 22.55 23.90 22.90 20.30 ... 22.05 20.80 20.40 22.70Aug. 18.55 20.55 21.90 20.90 18.55 ... 20.00 19.10 19.35 21.10July 18.50 19.60 21.25 20.05 17.75 ... 18.95 18.45 20.00 20.80June 18.50 18.40 20.45 18.80 17.20 ... 17.90 17.60 19.60 20.50May 18.94 19.10 21.05 19.40 16.85 20.95 18.80 17.65 19.05 20.10April 20.35 20.90 23.25 21.40 17.60 22.30 20.75 18.35 19.30 20.60March 19.46 20.30 21.75 21.00 17.20 20.80 20.55 17.75 19.50 21.20Feb. 17.68 17.90 18.80 18.50 15.95 17.95 18.10 16.60 19.45 20.40Jan. 18.41 17.90 18.75 18.50 16.55 17.70 17.90 17.15 20.25 20.60

1995Dec. 17.75 17.95 19.05 18.45 17.00 17.60 18.05 17.30 18.70 19.55Nov. 17.75 16.85 18.00 17.20 15.65 16.55 16.65 15.85 17.25 18.10Oct. 15.75 16.05 17.35 16.45 14.80 15.90 15.95 15.05 16.70 17.20Sept. 16.25 16.65 18.20 17.10 15.55 16.80 16.60 15.75 16.70 17.50Aug. 15.97 16.00 17.80 16.25 15.40 16.85 15.70 15.50 16.45 17.50July 15.65 15.85 17.25 15.95 15.05 16.25 15.20 15.30 16.10 17.25June 17.07 17.40 18.40 17.60 16.25 17.40 17.05 16.45 17.30 18.35May 18.32 18.35 19.75 18.75 17.30 18.70 17.95 17.50 18.45 19.35April 18.39 18.65 19.95 18.95 17.45 18.80 18.55 17.75 18.55 19.05March 17.13 17.00 18.55 17.30 16.30 17.40 17.10 16.75 18.90 18.50Feb. 17.26 17.10 18.55 17.50 16.55 17.45 17.10 17.00 18.85 18.80Jan. 15.78 16.55 17.95 16.85 15.95 16.80 16.60 16.55 17.25 18.40




SPOT ASSESSMENTS FOR VARIOUS CRUDE OIL GRADES (In $/barrel)

MIDEAST

Saudi Arabia Iran Kuwait Yemen Abu Dhabi1996 Light Light Heavy Kuwait Masila Marib Murban U. ShaifSept. 20.95 21.05 19.95 19.85 22.11 22.63 21.90 21.80Aug. 19.05 19.20 18.20 18.25 20.11 22.63 20.05 20.00July 18.25 18.60 17.50 17.95 19.46 19.98 19.45 19.30June 17.40 17.75 17.15 16.25 19.30 19.85 18.60 19.00May 18.30 18.25 17.05 17.00 19.50 20.10 18.40 18.05April 20.20 19.15 17.55 17.60 18.05 21.32 19.20 18.70March 19.25 18.95 17.50 17.00 18.20 19.79 18.75 18.30Feb. 17.00 16.95 15.95 15.90 18.20 17.82 17.70 17.10Jan. 17.15 17.25 16.75 16.55 18.05 17.97 18.30 17.65

1995Dec. 17.10 17.10 17.00 16.80 17.61 18.01 18.35 16.75Nov. 15.85 15.85 15.75 15.45 17.61 17.88 17.05 16.40Oct. 15.10 15.05 14.95 14.60 16.42 16.85 16.00 15.35Sept. 15.70 15.85 15.85 15.45 15.70 16.06 16.65 16.10Aug. 15.30 15.10 15.40 15.30 16.29 16.79 16.20 15.80July 15.15 14.85 15.30 15.00 15.66 16.16 15.85 15.45June 16.50 16.35 16.50 15.80 15.46 15.96 17.10 16.80May 17.60 17.45 17.70 17.35 17.82 18.72 18.30 18.05April 17.80 17.85 17.65 17.35 17.86 18.76 18.40 18.05March 16.55 16.80 16.35 16.20 16.26 17.03 17.45 17.25Feb. 16.90 16.75 16.60 16.20 ... ... 18.00 17.50Jan. 16.25 16.40 15.95 15.70 ... ... 17.50 16.90

1994Dec. 15.50 15.65 15.40 15.15 ... ... 17.05 16.45Nov. 16.30 16.40 15.90 15.55 ... ... 17.60 16.95Oct. 15.70 15.70 15.70 14.90 ... ... 17.00 16.25Sept. 15.20 15.25 15.55 14.65 ... ... 16.70 15.95Aug. 16.05 16.20 16.05 15.65 ... ... 17.20 16.70July 16.60 16.50 16.50 16.05 ... ... 17.65 17.15June 15.85 15.90 15.65 15.05 ... ... 17.00 16.60May 15.05 15.45 15.10 14.10 ... ... 16.35 16.65April 14.00 14.60 14.35 13.05 ... ... 15.20 15.80March 12.60 13.35 12.95 11.70 ... ... 14.15 14.60Feb. 12.85 13.20 12.55 11.75 ... ... 14.80 15.10Jan. 13.15 13.70 13.00 11.90 ... ... 15.05 15.20

1993Dec. 12.10 12.75 11.95 11.25 ... ... 14.25 14.60Nov. 13.75 14.00 13.05 12.75 ... ... 15.85 16.20Oct. 14.95 15.30 14.40 13.85 ... ... 16.70 17.20Sept. 14.15 14.50 13.70 13.15 ... ... 16.05 15.95Aug. 14.70 15.10 14.00 13.65 ... ... 16.70 17.20July 14.75 14.90 14.00 13.50 ... ... 16.50 16.35June 15.80 15.60 14.70 14.70 ... ... 17.55 17.50May 16.60 16.50 15.70 15.15 ... ... 17.80 17.80April 16.90 16.65 15.85 15.70 ... ... 18.25 18.20March 16.95 16.85 15.85 15.70 ... ... 18.45 18.25Feb. 16.05 16.65 15.60 15.35 ... ... 18.05 17.75Jan. 15.80 15.60 14.70 14.40 ... ... 17.20 16.90

I6 PIW © CRUDE OIL HANDBOOK


MIDEAST AFRICANigeria

Qatar Syria Bonny Angola Cameroon1996 Marine Dukhan Light Souedieh Medium Forcados Cabinda KoleSept. 21.05 21.05 22.47 20.02 22.65 22.90 21.70 22.20Aug. 19.25 19.35 20.47 17.67 20.55 20.75 20.00 20.15July 18.65 18.75 19.56 17.31 19.75 19.90 19.10 19.35June 17.80 17.85 19.95 17.10 18.50 18.50 17.85 18.05May 17.70 17.80 19.90 17.00 19.40 19.45 18.55 18.90April 18.45 18.55 21.22 18.30 21.00 21.40 20.40 20.65March 18.00 18.10 20.09 17.33 20.80 20.95 19.75 19.95Feb. 16.90 17.00 18.18 15.42 18.10 18.55 17.45 17.35Jan. 17.45 17.55 17.57 14.81 18.30 18.55 17.40 17.50

1995Dec. 17.50 17.60 18.02 15.32 18.25 18.50 17.40 17.45Nov. 16.15 16.25 18.02 15.32 17.00 17.15 16.15 16.25Oct. 15.15 15.35 16.64 14.06 16.25 16.35 15.35 15.50Sept. 15.95 16.10 15.65 13.01 16.60 17.05 16.05 16.50Aug. 15.50 15.65 16.14 13.80 16.05 16.20 15.25 15.45July 15.25 15.65 15.39 14.54 15.85 16.00 14.85 15.35June 16.40 16.60 15.44 14.29 17.25 17.55 16.55 16.85May 17.75 17.85 17.97 16.94 18.50 18.70 17.85 18.00April 17.90 18.05 18.19 16.77 18.65 18.80 18.20 18.05March 17.20 17.40 16.46 15.10 17.00 17.10 16.60 16.55Feb. 17.40 17.55 ... ... 17.20 17.40 16.65 16.55Jan. 16.90 17.10 ... ... 16.50 16.80 15.85 16.00

1994Dec. 16.50 16.70 ... ... 15.85 15.95 14.90 15.35Nov. 16.95 17.10 ... ... 17.35 17.50 16.40 16.75Oct. 16.30 16.55 ... ... 16.75 16.90 15.50 16.00Sept. 16.10 16.35 ... ... 16.00 16.20 15.05 15.35Aug. 16.65 16.85 ... ... 16.90 17.15 15.90 16.30July 17.15 17.30 ... ... 17.75 18.05 16.65 17.05June 16.50 16.70 ... ... 17.10 17.25 15.90 16.20May 15.75 15.95 ... ... 16.50 16.70 15.45 15.65April 14.60 14.80 ... ... 15.35 15.35 14.55 14.55March 13.35 13.60 ... ... 14.25 14.45 13.30 13.35Feb. 13.90 14.15 ... ... 14.25 14.40 13.00 13.30Jan. 14.15 14.45 ... ... 14.65 14.85 13.15 13.50

1993Dec. 13.30 13.55 ... ... 13.90 14.10 12.05 12.75Nov. 14.70 15.00 ... ... 15.50 15.80 13.65 14.30Oct. 15.65 16.00 ... ... 16.80 17.15 15.35 15.75Sept. 15.05 15.30 ... ... 16.25 16.55 14.75 15.20Aug. 15.90 16.10 ... ... 16.85 17.20 15.40 15.80July 15.60 15.80 ... ... 17.10 17.30 15.55 15.90June 16.60 16.70 ... ... 17.85 18.00 16.50 16.70May 16.80 17.05 ... ... 18.70 19.00 17.60 17.55April 17.30 17.45 ... ... 18.85 19.05 17.65 17.90March 17.35 17.55 ... ... 18.95 19.15 17.45 18.10Feb. 17.00 17.15 ... ... 18.55 18.70 17.15 17.55Jan. 16.25 16.45 ... ... 17.35 17.45 15.80 16.70



AFRICA MEDITERRANEAN

Gabon Algeria Libya1996 Mandji Saharan Condensate Es Sider Brega Zueitina Amna SarirSept. 20.90 23.05 24.96 22.34 22.75 22.80 22.02 22.07Aug. 18.75 20.90 22.14 20.30 20.70 20.75 21.12 20.07July 17.95 20.15 21.55 19.50 19.95 19.95 19.34 19.39June 16.70 18.90 20.50 18.20 18.40 18.50 18.60 18.10May 18.10 19.75 21.16 19.25 19.55 19.60 19.75 19.20April 20.05 21.65 22.65 21.05 21.35 21.40 20.60 20.65March 19.30 21.10 21.02 20.50 20.70 20.65 19.20 18.05Feb. 16.85 18.60 20.24 18.20 18.30 18.10 19.17 17.97Jan. 16.75 18.65 19.47 18.10 18.35 18.45 16.93 17.41

1995Dec. 16.45 18.60 18.91 18.00 18.30 18.25 17.36 16.25Nov. 15.20 17.30 17.68 16.75 17.10 17.00 17.36 16.25Oct. 14.45 16.60 17.21 16.05 16.40 16.35 16.20 16.25Sept. 15.50 17.40 18.52 16.65 17.10 17.25 15.43 15.48Aug. 14.35 16.25 17.91 15.80 16.05 16.10 16.05 16.10July 14.30 16.15 17.47 15.75 16.00 16.00 15.43 15.50June 17.65 19.64 17.40 19.64 17.55 17.60 15.26 15.31May 17.20 18.80 20.12 18.50 18.65 18.75 17.85 17.90April 17.95 18.95 19.14 18.70 18.75 18.75 18.55 18.60March 15.75 17.30 19.12 17.05 17.20 17.20 17.25 17.30Feb. 15.65 17.25 18.11 17.25 17.35 17.30 ... ...Jan. 15.30 16.90 17.88 16.65 16.85 16.75 ... ...

1994Dec. 14.55 16.30 18.35 15.95 16.15 16.10 ... ...Nov. 16.00 17.65 19.29 17.15 17.40 17.45 ... ...Oct. 15.05 16.85 18.96 16.25 16.60 16.55 ... ...Sept. 14.25 16.00 17.99 15.50 15.90 15.90 ... ...Aug. 15.10 16.80 18.20 16.35 16.75 16.80 ... ...July 15.75 17.70 18.15 17.15 17.55 17.55 ... ...June 14.95 16.90 18.00 16.45 16.75 16.75 ... ...May 14.55 16.55 17.53 16.10 16.30 16.25 ... ...April 13.50 15.60 16.16 15.10 15.30 15.25 ... ...March 12.25 14.45 15.92 13.80 14.10 14.15 ... ...Feb. 12.10 14.50 15.80 13.55 14.00 14.10 ... ...Jan. 12.40 15.00 15.12 13.90 14.35 14.35 ... ...

1993Dec. 11.65 14.20 14.81 13.00 13.55 13.65 ... ...Nov. 13.10 15.80 15.32 14.55 15.20 15.20 ... ...Oct. 14.50 17.10 18.04 15.95 16.55 16.60 ... ...Sept. 13.70 16.60 17.58 15.45 16.10 16.15 ... ...Aug. 14.30 17.35 18.61 16.10 16.75 16.85 ... ...July 14.65 17.30 18.71 16.20 16.85 16.95 ... ...June 15.40 17.70 19.36 17.05 17.45 17.75 ... ...May 16.20 18.85 19.33 17.95 18.60 18.60 ... ...April 16.15 19.05 20.45 18.15 18.70 18.70 ... ...March 16.10 19.10 18.97 18.30 18.80 18.85 ... ...Feb. 15.65 18.90 18.83 17.90 18.55 18.55 ... ...Jan. 14.60 17.80 18.85 16.90 17.45 17.45 ... ...



MEDITERRANEAN EUROPEEgypt Russia

Libya Suez Zeit (c.i.f.) UK Norway1996 Sirtica Blend Bay Urals Forties Flotta Ekofisk OsebergSept. 22.47 20.20 ... 21.65 22.70 22.80 22.65 23.65Aug. 20.47 18.20 ... 19.70 20.75 21.37 20.75 22.05July 19.94 17.30 ... 18.55 19.90 18.30 20.00 19.40June 18.00 18.95 ... 17.25 18.70 18.10 19.10 19.20May 20.00 17.33 19.30 18.35 19.55 18.88 19.50 19.62April 21.35 19.18 19.90 20.15 21.50 20.74 21.45 21.50March 18.75 18.51 18.60 20.15 20.85 19.65 20.95 20.47Feb. 18.70 16.43 16.90 17.80 18.30 17.48 18.45 18.43Jan. 18.01 15.77 15.87 18.05 18.25 16.69 18.30 17.55

1995Dec. 16.85 16.22 16.77 17.90 18.20 17.55 18.20 18.11Nov. 16.85 15.10 16.77 16.30 17.05 17.55 17.00 18.11Oct. 16.85 14.30 15.66 15.50 16.25 16.84 16.25 17.73Sept. 16.08 14.95 14.92 16.25 17.00 16.00 17.00 16.70Aug. 16.65 13.90 15.37 15.30 16.10 16.55 16.10 16.45July 15.98 13.95 14.57 14.80 15.95 15.25 16.00 15.95June 15.81 16.05 14.30 16.80 17.60 15.20 17.55 15.90May 18.40 17.20 17.90 17.90 18.50 17.70 18.60 18.38April 19.10 17.70 18.01 18.25 18.80 18.43 18.85 19.01March 17.90 16.15 16.51 16.75 17.05 17.60 17.10 17.80Feb. ... 16.10 ... 16.75 17.15 ... 17.15 ...Jan. ... 15.35 ... 16.70 16.60 ... 16.65 ...

1994Dec. ... 14.50 ... 15.80 15.95 ... 15.90 ...Nov. ... 15.70 ... 17.05 17.25 ... 17.35 ...Oct. ... 14.75 ... 16.00 16.50 ... 16.50 ...Sept. ... 14.10 ... 15.25 15.75 ... 15.85 ...Aug. ... 14.95 ... 15.95 16.60 ... 16.75 ...July ... 15.60 ... 16.50 17.45 ... 17.55 ...June ... 14.85 ... 16.00 16.65 ... 16.80 ...May ... 14.25 ... 15.25 16.15 ... 16.35 ...April ... 13.40 ... 14.55 15.30 ... 15.30 ...March ... 12.05 ... 13.50 14.05 ... 14.10 ...Feb. ... 11.60 ... 13.20 13.85 ... 14.00 ...Jan. ... 11.90 ... 13.70 14.40 ... 14.45 ...

1993Dec. ... 10.90 ... 12.65 13.55 ... 13.65 ...Nov. ... 12.40 ... 13.95 15.05 ... 15.20 ...Oct. ... 13.65 ... 15.20 16.40 ... 16.65 ...Sept. ... 13.00 ... 14.30 15.85 ... 16.20 ...Aug. ... 13.55 ... 15.05 16.80 ... 17.05 ...July ... 13.45 ... 15.10 16.85 ... 17.10 ...June ... 14.75 ... 16.40 17.55 ... 17.80 ...May ... 15.10 ... 16.60 18.30 ... 18.55 ...April ... 15.30 ... 16.85 18.70 ... 18.75 ...March ... 15.55 ... 17.20 18.85 ... 19.00 ...Feb. ... 15.10 ... 16.85 18.60 ... 18.80 ...Jan. ... 14.15 ... 15.60 17.40 ... 17.55 ...



EUROPE ASIA

Norway Indonesia PNG China1996 Statfjord Ardjuna Attaka Arun Cond. Walio Kutubu DaqingSept. 22.60 20.10 21.60 20.50 20.40 21.20 20.45Aug. 20.70 19.85 20.15 19.50 19.50 20.90 19.50July 19.95 19.80 20.35 19.35 18.90 19.84 19.95June 19.12 19.55 20.10 19.00 18.80 19.60 19.55May 19.55 19.55 20.05 18.90 18.67 19.48 19.00April 21.45 19.60 20.25 19.20 18.67 19.48 19.25March 21.15 19.50 20.45 19.35 18.99 19.93 19.45Feb. 18.70 19.10 19.85 18.80 18.67 19.54 19.45Jan. 18.35 19.55 20.20 19.20 19.15 19.67 20.10

1995Dec. 18.35 18.45 19.00 18.20 18.14 18.65 18.60Nov. 17.10 17.05 17.40 16.90 18.14 18.65 17.10Oct. 16.30 16.35 16.80 16.35 16.76 17.38 16.55Sept. 16.95 16.65 16.95 16.55 16.18 16.64 16.55Aug. 16.15 16.55 16.90 16.55 16.38 16.99 16.35July 16.10 16.60 16.55 16.40 16.28 17.04 16.10June 17.60 17.80 17.85 17.75 16.25 16.87 17.40May 18.55 18.35 18.65 18.45 18.30 18.89 18.35April 18.90 18.25 18.40 18.30 18.21 18.70 18.40March 17.15 18.45 18.65 18.15 18.00 17.83 18.65Feb. 17.20 18.00 18.25 18.15 ... ... 18.45Jan. 16.70 16.85 17.15 17.05 ... ... 16.90

1994Dec. 15.95 16.25 16.30 16.35 ... ... 15.95Nov. 17.30 16.45 16.35 16.55 ... ... 16.15Oct. 16.55 16.55 16.95 16.70 ... ... 16.15Sept. 15.80 17.30 17.10 16.90 ... ... 16.60Aug. 16.65 19.65 18.40 18.25 ... ... 18.70July 17.55 18.40 18.25 18.15 ... ... 17.85June 16.75 16.75 16.85 16.85 ... ... 15.50May 16.30 15.80 16.05 16.00 ... ... 14.60April 15.25 14.60 14.90 14.90 ... ... 13.45March 14.20 14.80 15.10 14.80 ... ... 13.65Feb. 13.90 15.40 16.00 15.50 ... ... 14.50Jan. 14.55 14.60 15.35 14.95 ... ... 13.85

1993Dec. 13.80 14.40 14.95 14.65 ... ... 13.40Nov. 15.20 16.15 16.50 16.30 ... ... 14.95Oct. 16.60 17.05 17.35 17.35 ... ... 15.85Sept. 16.15 16.80 17.05 17.15 ... ... 16.20Aug. 17.00 17.40 17.60 17.50 ... ... 17.10July 17.10 17.85 18.05 17.90 ... ... 17.40June 17.30 19.15 19.05 19.00 ... ... 19.10May 18.60 20.05 20.20 19.90 ... ... 20.10April 18.55 20.25 20.20 20.00 ... ... 19.85March 18.75 19.60 19.85 19.65 ... ... 19.50Feb. 18.70 18.75 18.90 18.70 ... ... 18.20Jan. 17.55 18.50 19.20 18.75 ... ... 18.15



AMERICASUS Colombia Ecuador

Louisiana Louisiana California Cano Limon Oriente1996 WTS Light Sweet Heavy Swt. Kern River Line (US Gulf) (US Gulf)Sept. 22.70 24.10 24.05 20.45 21.11 23.10 22.00Aug. 20.60 22.00 21.96 19.00 19.45 20.75 19.85July 19.95 21.10 20.87 13.75 18.86 20.30 19.55June 19.10 20.05 20.15 14.10 20.05 19.55 19.20May 20.05 20.95 20.75 14.40 18.66 21.85 19.70April 22.40 22.95 22.83 14.20 21.25 23.35 22.40March 21.05 21.80 21.23 ... 19.63 21.25 20.55Feb. 18.15 19.50 19.34 14.20 17.02 18.80 17.75Jan. 17.95 19.55 19.14 13.20 16.67 18.55 17.45

1995Dec. 17.90 19.60 19.15 12.80 16.03 18.35 17.30Nov. 16.65 18.30 19.15 12.80 16.03 17.20 16.90Oct. 16.15 17.65 17.93 12.25 15.39 16.45 15.35Sept. 16.90 18.15 17.38 12.75 15.32 17.30 16.35Aug. 16.90 18.00 18.08 13.70 15.85 17.05 16.40July 16.50 17.40 18.00 14.10 15.35 16.30 15.95June 17.80 18.70 17.40 15.05 15.30 17.55 17.15May 19.00 19.95 19.70 15.04 17.48 19.00 18.55April 19.15 20.15 19.91 15.16 17.34 19.10 18.20March 17.60 18.45 18.19 13.09 15.98 17.75 17.05Feb. 17.45 18.60 ... ... ... 17.55 17.10Jan. 17.15 18.30 ... ... ... 17.45 16.60

1994Dec. 16.50 17.45 ... ... ... 16.40 15.85Nov. 17.35 18.30 ... ... ... 17.15 16.50Oct. 16.70 17.75 ... ... ... 16.35 14.95Sept. 16.35 17.35 ... ... ... 15.90 15.60Aug. 17.35 18.35 ... ... ... 17.20 16.60July 17.90 19.10 ... ... ... 17.70 16.85June 17.85 18.40 ... ... ... 17.05 16.30May 17.05 18.00 ... ... ... 17.15 16.40April 15.65 16.80 ... ... ... 15.75 15.10March 13.90 15.05 ... ... ... 14.05 13.45Feb. 14.00 15.00 ... ... ... 14.05 13.60Jan. 14.00 15.30 ... ... ... 13.75 13.15

1993Dec. 13.15 14.70 ... ... ... 12.70 11.75Nov. 15.00 16.85 ... ... ... 14.70 13.55Oct. 16.45 18.30 ... ... ... 16.45 15.55Sept. 16.00 17.75 ... ... ... 15.70 15.15Aug. 16.15 18.25 ... ... ... 16.35 15.60July 16.35 18.05 ... ... ... 16.10 15.30June 17.60 18.85 ... ... ... 17.35 16.60May 18.60 20.10 ... ... ... 18.05 17.55April 18.55 20.15 ... ... ... 18.40 18.05March 18.65 20.10 ... ... ... 18.40 18.15Feb. 18.70 20.15 ... ... ... 18.25 18.30Jan. 17.30 19.10 ... ... ... 16.50 16.55

f Formula. r Retrospective. s Spot.


PIW SCORECARD � COSTS TO REFINERSOF KEY FORMULA PRICED CRUDE OILS IN PRIMARY WORLD MARKETS (In $/barrel)

DELIVERED TO ROTTERDAM1996 Arab Arab Arab Arab Arab Arab Arab ArabPoint Extra Light Light Medium Heavy Extra Light* Light* Medium* Heavy*of Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (Sidi Kerir) (Sidi Kerir) (Sidi Kerir) (Sidi Kerir)Sept. 22.24 21.47 20.54 20.20 22.25 21.45 20.55 20.15Aug. 20.49 19.76 18.90 18.58 20.26 19.46 18.56 18.16July 19.89 19.29 18.57 18.27 19.50 18.70 17.80 17.40June 18.79 18.24 17.52 17.24 18.49 17.85 17.10 16.80May 19.80 19.34 18.69 18.43 19.34 18.74 17.99 17.69April 21.44 21.01 20.43 20.20 21.02 20.57 19.87 19.57March 19.64 19.21 18.61 18.35 19.74 19.27 18.69 18.44Feb. 17.67 17.15 16.51 16.16 17.87 17.41 16.82 16.57Jan. 18.26 17.84 17.20 16.82 17.72 17.27 16.62 16.27

1995Dec. 17.91 17.49 16.82 16.43 17.71 17.26 16.61 16.21Nov. 16.76 16.28 15.54 15.11 16.67 15.97 15.57 15.17Oct. 16.02 15.60 14.86 14.43 15.95 15.39 14.75 14.30Sept. 16.53 16.13 15.46 15.05 16.34 15.89 15.14 14.69Aug. 15.98 15.66 15.12 14.79 15.61 15.16 14.41 13.96July 16.02 15.71 15.17 14.84 15.56 15.21 14.66 14.31June 17.64 17.37 16.88 16.58 17.05 16.74 16.19 15.84May 18.66 18.34 17.89 17.61 18.16 17.86 17.31 16.96April 18.57 18.22 17.71 17.40 18.38 18.08 17.68 17.43March 17.04 16.73 16.26 15.99 16.92 16.52 15.97 15.62Feb. 17.24 16.81 16.28 15.86 16.98 16.67 16.23 15.98Jan. 16.54 16.01 15.42 14.87 16.53 16.13 15.58 15.23

1994Dec. 16.19 15.51 14.84 14.31 15.60 15.10 14.55 14.00Nov. 17.25 16.66 16.12 15.69 17.19 16.47 15.74 15.14Oct. 16.26 15.79 15.21 14.76 16.29 15.59 15.04 14.59Sept. ... 15.18 14.51 14.05 ... 14.93 14.38 13.93Aug. ... 16.48 15.82 15.37 ... 15.78 15.08 14.58July ... 16.99 16.24 15.74 ... 16.78 16.13 15.68June ... 16.08 15.28 14.73 ... 15.85 15.05 14.60May ... 15.54 14.65 14.01 ... 15.26 14.41 13.91April ... 14.17 13.08 12.26 ... 14.13 13.23 12.68March ... 13.02 11.76 10.81 ... 12.91 11.81 11.06Feb. ... 13.00 11.71 10.68 ... 12.48 11.18 10.28Jan. ... 12.99 11.70 10.66 ... 13.02 11.62 10.64

1993Dec. ... 12.47 11.19 10.13 ... 12.14 10.79 9.79Nov. ... 13.92 12.62 11.59 ... 13.49 12.14 11.09Oct. ... 15.14 13.81 12.77 ... 14.79 13.49 12.44Sept. ... 14.42 13.09 12.05 ... 14.16 12.81 11.76Aug. ... 15.08 13.74 12.71 ... 14.66 ... ...July ... 15.22 13.93 12.90 ... 14.73 ... ...June ... 16.32 15.05 14.02 ... 15.53 ... ...May ... 17.17 15.84 14.81 ... 16.56 ... ...April ... 17.23 15.97 14.90 ... 16.94 ... ...March ... 17.78 16.43 15.39 ... 16.95 ... ...Feb. ... 17.53 16.29 15.36 ... 16.95 ... ...Jan. ... 16.49 15.23 14.28 ... 16.14 ... ...

*Point of sale: Sidi Kerir.



DELIVERED TO ROTTERDAM1996 Kuwait Iran Iran Nigeria Nigeria Libya Market Link:Point Kuwait Light Heavy Bonny Lt. Forcados Es Sider Brent (f.o.b.)of Sale: (f.o.b.) (c.i.f.) (c.i.f.) (f.o.b.) (f.o.b.) (f.o.b.) (Sullom Voe)Sept. 20.58 21.85 21.05 23.05 22.82 22.96 22.55Aug. 18.93 19.86 19.06 21.19 20.94 20.97 20.55July 18.58 18.95 18.15 20.69 20.43 20.19 19.60June 17.52 18.10 17.25 20.02 19.88 19.18 18.40May 18.69 18.95 18.15 20.69 20.43 20.19 19.60April 20.43 20.52 20.07 22.73 22.68 21.80 20.90March 18.61 19.26 19.02 20.26 20.22 20.45 20.30Feb. 16.51 17.39 17.10 18.49 18.41 17.93 17.90Jan. 17.20 17.75 17.44 19.65 19.58 18.37 17.90

1995Dec. 16.82 17.86 17.66 18.65 18.56 18.41 17.95Nov. 15.54 16.42 16.27 17.62 17.53 17.23 16.75Oct. 14.86 15.83 15.80 17.23 17.15 16.50 16.05Sept. 15.46 16.54 16.34 17.48 17.43 17.02 16.65Aug. 15.12 15.91 15.36 16.83 16.75 16.40 16.00July 15.17 15.31 14.96 17.26 17.12 16.31 15.85June 16.88 16.55 16.15 18.85 18.68 17.88 17.40May 17.89 17.71 17.36 19.72 19.51 18.76 18.35April 17.71 18.08 17.78 19.23 18.90 18.98 18.65March 16.26 16.67 16.37 17.97 17.69 17.49 17.00Feb. 16.28 16.43 16.13 18.05 17.91 17.74 17.10Jan. 15.42 16.63 16.28 17.15 17.05 17.13 16.55





DELIVERED TO US GULF COAST1996 Arab Arab Arab Arab Arab Arab Arab Arab KuwaitPoint Extra Light Light Medium Heavy Extra Light Light Medium Heavy Kuwaitof Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (c.i.f.) (c.i.f.) (c.i.f.) (c.i.f.) (c.i.f.)Sept. 22.99 22.37 21.70 21.28 22.53 21.78 20.98 20.48 20.98Aug. 21.11 20.47 19.70 19.18 20.75 20.10 19.45 19.05 19.45July 20.56 19.92 19.09 18.52 20.26 19.61 18.86 18.36 18.86June 19.64 19.02 18.23 17.68 19.44 18.74 17.89 17.29 17.74May 20.56 19.92 19.11 18.60 20.47 19.82 19.07 18.37 19.07April 22.66 22.11 21.41 20.96 22.50 21.85 21.10 20.55 20.86March 20.65 20.13 19.45 19.05 20.69 20.09 19.34 18.84 18.96Feb. 18.01 17.45 16.72 16.32 18.19 17.64 16.94 16.49 16.81Jan. 18.09 17.49 16.78 16.40 17.90 17.35 16.65 16.25 16.58

1995Dec. 18.11 17.49 16.80 16.42 18.12 17.47 16.67 16.22 16.54Nov. 17.00 16.35 15.64 15.24 17.27 16.67 16.02 15.67 15.94Oct. 16.73 16.13 15.52 15.21 16.47 15.77 15.02 14.57 14.99Sept. 17.39 16.82 16.29 16.09 17.30 16.65 15.95 15.55 15.95Aug. 17.09 16.44 15.83 15.55 16.98 16.38 15.83 15.58 15.76July 16.29 15.62 14.98 14.60 16.40 15.80 15.25 15.05 15.16June 17.15 16.69 16.12 15.83 17.56 16.85 16.15 15.75 16.15May 18.62 18.04 17.48 17.20 18.83 18.18 17.58 17.18 17.58April 19.06 18.44 17.80 17.40 19.09 18.64 18.09 17.84 18.09March 17.79 17.26 16.66 16.28 17.78 17.13 16.53 16.13 16.53Feb. 17.46 16.94 16.33 15.90 17.83 17.20 16.49 16.04 16.49Jan. 17.02 16.34 15.61 15.19 17.27 16.86 16.26 15.91 16.26

1994Dec. 16.10 15.36 14.50 14.00 16.09 15.47 14.75 14.30 14.75Nov. 16.76 15.92 15.09 14.59 17.28 16.45 15.67 15.22 15.67Oct. 16.55 15.85 15.06 14.58 16.65 15.86 14.89 14.31 14.89Sept. ... 15.50 14.64 14.09 ... 15.75 15.00 14.55 15.00Aug. ... 16.10 15.20 14.60 ... 16.26 15.41 14.86 15.41July ... 17.85 16.86 16.18 ... 18.01 17.11 16.51 17.11June ... 17.25 16.19 15.44 ... 17.40 16.45 15.80 16.45May ... 15.97 14.89 14.11 ... 15.89 14.84 14.09 14.84April ... 14.45 13.34 12.56 ... 14.32 13.22 12.42 13.22March ... 12.41 11.11 10.24 ... 12.77 11.67 10.87 11.57Feb. ... 12.72 11.31 10.41 ... 12.62 11.48 10.67 11.38Jan. ... 13.44 12.06 11.18 ... 12.56 11.10 10.16 11.00

1993Dec. ... 12.14 10.81 9.92 ... 12.22 10.82 9.92 10.79Nov. ... 13.48 12.20 11.32 ... 14.11 12.71 11.81 12.85Oct. ... 15.32 13.98 13.05 ... 15.82 14.52 13.62 14.29Sept. ... 15.24 13.90 12.97 ... 15.35 14.05 13.15 13.61Aug. ... 15.77 14.49 13.61 ... 15.80 14.39 13.39 13.89July ... 15.59 14.26 13.38 ... 15.60 14.30 13.40 14.77June ... 16.57 15.18 14.30 ... 16.68 15.38 14.48 15.03May ... 17.75 16.43 15.58 ... 17.89 16.48 15.48 16.28April ... 18.23 16.84 15.96 ... 18.41 17.01 16.01 16.74March ... 18.35 17.05 16.08 ... 18.36 17.05 16.05 16.95Feb. ... 18.08 16.82 15.89 ... 18.01 16.61 15.41 16.72Jan. ... 16.82 15.53 14.55 ... 16.69 15.44 14.44 15.43



DELIVERED TO US GULF COAST1996 Nigeria Nigeria Mexico Mexico Mexico Col. Cano Ecuador Market Links:Point Bonny Lt. Forcados Isthmus Maya Olmeca Limon Oriente ANS WTIof Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (Gulf) (Cushing)Sept. 23.01 22.84 22.48 19.19 23.47 22.41 21.10 ... 23.90Aug. 21.19 21.00 20.58 17.22 21.40 20.48 19.40 ... 21.90July 20.64 20.43 19.90 16.43 20.75 20.11 19.20 ... 21.25June 19.90 19.83 18.68 16.48 19.61 19.42 18.29 ... 20.45May 21.17 21.13 19.64 15.91 20.86 21.12 20.40 ... 21.05April 22.72 22.70 20.64 16.61 22.41 23.02 20.83 ... 23.25March 20.27 20.27 19.92 16.63 20.56 20.62 18.88 ... 21.75Feb. 18.56 18.52 17.81 15.13 18.45 18.24 16.56 ... 18.80Jan. 19.64 19.59 18.09 15.37 18.99 18.50 16.89 ... 18.75

1995Dec. 18.53 18.48 17.51 15.28 18.30 17.90 15.87 ... 19.05Nov. 17.49 17.42 16.33 13.73 17.19 16.88 15.53 ... 17.95Oct. 17.13 17.08 15.86 13.48 16.71 16.40 15.66 ... 17.35Sept. 17.53 17.49 16.51 13.77 17.20 17.20 16.54 ... 18.20Aug. 16.81 16.75 16.39 13.26 16.85 16.93 16.05 ... 17.80July 17.17 17.07 16.11 14.70 16.65 16.32 16.12 ... 17.25June 18.81 18.67 17.43 15.56 17.99 18.27 17.67 ... 18.40May 19.64 19.45 18.76 16.64 19.22 19.13 18.54 ... 19.75April 19.23 18.93 18.93 16.49 18.92 18.13 17.53 ... 19.95March 17.91 17.66 16.99 15.11 17.44 17.55 16.87 17.40 18.55Feb. 18.05 17.93 17.05 14.87 17.52 17.35 16.90 17.45 18.55Jan. 17.08 17.00 17.31 14.43 17.87 16.35 15.88 16.80 17.95





DELIVERED TO SINGAPORE1996 Arab Arab Arab Arab Arab Iran Iran Market Links (f.o.b.):Point Super Lt. Extra Light Light Medium Heavy Light Heavy Dubai Omanof Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) Fateh SpotSept. 22.15 21.34 20.50 19.46 18.88 20.25 19.38 20.30 20.80Aug. 21.19 20.53 19.69 18.60 18.04 19.44 18.52 18.55 19.10July 20.42 19.76 18.93 17.90 17.39 18.67 17.82 17.75 18.45June 19.93 19.26 18.42 17.53 17.14 18.17 17.45 17.20 17.60May 20.03 19.36 18.51 17.62 17.23 18.25 17.52 16.85 17.65April 20.08 19.41 18.57 17.72 17.36 18.33 17.67 17.60 18.35March 19.24 18.58 17.77 16.97 16.64 17.54 16.92 17.20 17.75Feb. 18.95 18.28 17.60 16.81 16.47 17.34 16.72 15.95 16.60Jan. 19.17 18.48 17.97 17.22 16.91 17.72 17.15 16.55 17.15

1995Dec. 18.51 17.74 17.35 16.66 16.17 17.17 16.65 17.00 17.30Nov. 17.41 16.64 16.25 15.55 15.06 16.00 15.48 15.65 15.85Oct. 17.33 16.53 16.19 15.57 15.03 15.97 15.53 14.80 15.05Sept. 17.67 16.88 16.54 15.95 15.31 16.34 15.94 15.55 15.75Aug. 17.42 16.71 16.32 15.73 15.13 16.12 15.72 15.40 15.50July 17.84 17.12 16.73 16.19 15.70 16.53 16.18 15.05 15.30June ... ... ... ... ... ... ... ... ...May ... ... ... ... ... ... ... ... ...April ... ... ... ... ... ... ... ... ...March ... ... ... ... ... ... ... ... ...Feb. ... ... ... ... ... ... ... ... ...Jan. ... ... ... ... ... ... ... ... ...

1994Dec. ... ... ... ... ... ... ... ... ...Nov. ... ... ... ... ... ... ... ... ...Oct. ... ... ... ... ... ... ... ... ...Sept. ... ... ... ... ... ... ... ... ...Aug. ... ... ... ... ... ... ... ... ...July ... ... ... ... ... ... ... ... ...June ... ... ... ... ... ... ... ... ...May ... ... ... ... ... ... ... ... ...April ... ... ... ... ... ... ... ... ...March ... ... ... ... ... ... ... ... ...Feb. ... ... ... ... ... ... ... ... ...Jan. ... ... ... ... ... ... ... ... ...

1993Dec. ... ... ... ... ... ... ... ... ...Nov. ... ... ... ... ... ... ... ... ...Oct. ... ... ... ... ... ... ... ... ...Sept. ... ... ... ... ... ... ... ... ...Aug. ... ... ... ... ... ... ... ... ...July ... ... ... ... ... ... ... ... ...June ... ... ... ... ... ... ... ... ...May ... ... ... ... ... ... ... ... ...April ... ... ... ... ... ... ... ... ...March ... ... ... ... ... ... ... ... ...Feb. ... ... ... ... ... ... ... ... ...Jan. ... ... ... ... ... ... ... ... ...


PIW SCORECARD � TERM CONTRACT PRICES AT PORT OF LOADING (In $/barrel)

MIDEASTSaudi Arabia f

Super Light Extra Light Extra Light Extra Light Extra Light Light Light Light1996 (Far East) (Europe) (US) (Far East) (Average)* (Europe) (US) (Far East)Sept. 22.38 ... ... 21.38 ... ... ... 20.53Aug. 21.06 21.60 21.62 20.36 20.76 20.79 20.96 19.51July 20.23 19.92 20.48 19.53 19.74 19.11 19.82 18.68June 19.55 18.42 18.85 18.85 17.99 17.76 18.08 18.08May 19.40 17.66 19.10 18.70 18.49 17.10 18.45 17.85April 20.08 18.13 18.69 19.38 18.73 17.62 18.04 18.53March 19.25 19.32 19.51 18.55 19.13 18.86 18.90 17.70Feb. 18.29 19.76 20.92 17.59 19.42 19.30 20.36 16.79Jan. 18.69 17.11 18.14 17.99 17.75 16.66 17.58 17.39

1995Dec. 18.81 15.96 15.71 18.06 16.58 15.50 15.05 17.61Nov. 17.44 17.21 17.03 16.64 16.96 16.75 16.42 16.24Oct. 16.67 16.20 16.47 15.87 16.18 15.74 15.76 15.47Sept. 17.25 14.95 15.43 16.40 15.59 14.49 14.77 16.10Aug. 17.12 15.04 15.10 16.37 15.50 14.58 14.49 15.97July 16.80 14.89 15.79 16.05 15.58 14.53 15.18 15.65June 17.95 14.68 15.44 17.20 16.27 14.33 14.69 16.80May 19.02 16.01 15.49 18.12 17.23 15.71 14.84 17.77April 19.14 17.26 17.06 18.34 17.89 16.96 16.61 17.99March 18.25 17.83 18.04 17.40 17.60 17.43 17.39 16.95Feb. 18.63 16.67 17.45 17.88 17.47 16.37 16.80 17.28Jan. ... 16.07 16.39 17.41 16.90 15.65 15.89 16.71

1994Dec. ... 15.91 16.08 16.90 16.52 15.40 15.40 16.20Nov. ... 15.10 15.51 17.40 16.52 14.40 14.84 16.70Oct. ... 15.81 15.35 16.77 16.34 15.27 14.43 16.07Sept. ... ... ... ... ... 15.99 15.14 15.91Aug. ... ... ... ... ... 14.56 14.67 16.63July ... ... ... ... ... 14.66 14.66 17.10June ... ... ... ... ... 16.42 16.44 16.49May ... ... ... ... ... 15.80 16.72 15.29April ... ... ... ... ... 14.78 15.72 14.33March ... ... ... ... ... 14.26 14.56 12.90Feb. ... ... ... ... ... 12.60 12.45 13.35Jan. ... ... ... ... ... 11.54 11.16 13.75

1993Dec. ... ... ... ... ... 12.61 12.67 12.77Nov. ... ... ... ... ... 11.38 11.55 14.34Oct. ... ... ... ... ... 12.15 11.36 15.33Sept. ... ... ... ... ... 13.57 13.44 14.73Aug. ... ... ... ... ... 13.63 14.60 15.38July ... ... ... ... ... 13.64 14.11 15.14June ... ... ... ... ... 14.07 14.65 16.37May ... ... ... ... ... 14.62 14.82 16.74April ... ... ... ... ... 15.76 16.18 17.08March ... ... ... ... ... 16.04 16.72 16.98Feb. ... ... ... ... ... 16.31 17.18 16.82Jan. ... ... ... ... ... 16.69 17.10 15.89

f Formula. r Retrospective. s Spot. *Estimate based on volume weighted average.




Light Medium Medium Medium Medium Heavy Heavy Heavy1996 (Average)* (Europe) (US) (Far East) (Average)* (Europe) (US) (Far East)Sept. ... ... ... 19.48 ... ... ... 18.78Aug. 20.35 19.88 20.31 18.46 19.60 19.47 19.90 17.97July 19.28 18.20 19.06 17.53 18.43 17.79 18.56 16.88June 18.00 17.99 17.01 17.10 17.14 16.70 16.61 16.70May 18.03 16.26 17.60 16.95 16.94 16.05 17.00 16.55April 18.06 16.92 17.29 17.63 17.28 16.62 16.74 17.23March 18.49 18.26 18.15 17.40 17.94 18.00 17.64 16.55Feb. 18.82 18.70 19.65 16.00 18.12 18.44 19.20 15.64Jan. 17.21 16.00 16.88 16.59 16.49 15.64 16.47 16.24







MIDEASTSaudi Arabia f Iran f Kuwait f

Heavy Light Light Light Heavy Heavy Heavy Kuwait1996 (Average)* (Europe) (Far East) (Average)* (Europe) (Far East) (Average)* (Europe)Sept. ... 21.49 20.24 20.93 20.96 19.36 20.24 ...Aug. 19.43 19.68 19.23 19.48 19.01 18.35 18.71 19.88July 18.07 18.13 18.40 18.25 17.28 17.42 17.34 18.20June 16.92 16.81 17.72 17.22 15.86 16.99 16.42 17.01May 16.53 17.62 17.56 17.60 16.77 16.83 16.80 16.26April 16.86 19.79 18.25 19.10 19.39 17.52 18.55 16.92March 17.40 18.89 17.47 18.32 18.50 16.84 17.96 18.26Feb. 17.76 16.87 16.51 16.75 16.53 15.88 16.30 18.70Jan. 16.12 16.65 17.10 16.98 16.40 16.47 16.50 16.00



1993Dec. 10.32 12.17 12.55 12.30 11.14 11.30 11.22 11.21Nov. 9.74 13.21 14.12 13.53 12.25 12.87 12.56 9.98Oct. 10.06 14.38 15.12 14.64 13.38 13.87 13.63 10.75Sept. 11.38 13.81 14.51 14.05 12.81 13.16 12.99 12.12Aug. 12.08 14.31 15.18 14.62 13.20 13.73 13.47 12.18July 11.85 14.10 14.92 14.39 13.15 13.47 13.31 12.19June 12.52 14.70 16.26 15.25 13.80 14.71 14.26 12.62May 12.78 15.58 16.62 15.94 14.75 15.07 14.91 13.32April 13.84 15.80 16.96 16.21 14.98 15.41 15.19 14.26March 14.22 16.04 16.86 16.33 15.10 15.31 15.21 ...Feb. 14.30 15.92 16.85 16.24 15.02 14.95 14.98 ...Jan. 14.50 15.12 15.84 15.37 14.22 14.29 14.26 ...




MIDEASTKuwait f Neutral Zone f Abu Dhabi r Dubai s

Kuwait Kuwait Khafji Umm Upper1996 (US) (Far East) (Far East) Murban Shaif Zakum Zakum FatehSept. ... 19.38 18.78 22.30 22.00 22.35 20.55 20.30Aug. ... 18.36 17.97 20.45 20.15 20.50 18.75 18.55July ... 17.43 16.88 19.55 19.25 19.65 17.85 17.75June ... 17.00 16.70 19.00 18.70 19.10 17.30 17.20May ... 16.85 16.55 18.60 18.25 18.65 16.95 16.85April ... 17.53 17.23 19.25 19.30 18.88 17.70 17.60March ... 17.30 16.55 18.45 18.05 18.45 16.95 17.20Feb. ... 15.89 15.64 17.45 17.05 17.45 15.90 15.95Jan. ... 16.49 16.24 18.20 17.80 18.20 16.65 16.55

1995Dec. ... 16.81 16.61 18.40 18.00 18.40 16.95 17.05Nov. ... 15.44 15.04 16.95 16.55 16.95 15.65 15.75Oct. ... 15.05 14.27 16.00 15.60 16.00 14.80 14.87Sept. ... 15.45 14.95 16.50 16.50 16.10 15.45 15.55Aug. ... 15.22 14.62 16.30 15.90 16.30 15.35 15.40July ... 15.00 14.60 15.80 15.40 15.75 15.00 15.05June ... 16.15 15.75 17.00 16.60 16.95 16.20 16.25May ... 17.22 16.92 18.20 17.80 18.15 17.35 17.30April ... 17.34 17.04 18.45 18.05 18.40 17.50 17.45March ... 16.20 15.85 17.40 17.00 17.30 16.35 16.30Feb. ... 16.24 15.70 17.90 17.50 17.80 16.75 16.55Jan. ... 15.71 15.21 17.35 16.90 17.25 16.05 15.95

1994Dec. ... 15.15 14.60 16.85 16.35 16.75 15.50 15.45Nov. ... 15.55 15.00 17.55 17.05 17.45 16.05 15.95Oct. ... 14.92 14.37 16.90 16.40 16.80 15.40 15.35Sept. ... 15.31 15.01 16.70 16.20 16.60 15.30 15.25Aug. ... 15.73 15.23 17.00 16.50 16.90 15.75 15.85July ... 16.20 15.70 17.60 17.10 17.50 16.40 16.40June ... 15.34 14.74 17.00 16.50 16.90 15.65 15.70May ... 13.99 13.29 16.10 15.60 16.00 14.65 14.80April ... 13.03 12.33 15.45 15.00 15.35 13.90 13.80March ... 11.65 10.95 13.75 13.30 13.65 12.08 12.25Feb. ... 11.85 10.90 14.60 14.15 14.50 12.80 12.80Jan. ... 12.00 10.90 15.10 14.65 15.00 13.30 13.15

1993Dec. ... 11.22 10.22 14.00 13.55 13.90 12.10 12.15Nov. ... 12.84 11.89 15.40 15.00 15.30 13.55 13.70Oct. ... 13.83 12.88 16.65 16.25 16.55 14.80 14.80Sept. ... 13.13 12.13 15.90 15.50 15.80 14.10 14.20Aug. 12.27 13.68 12.58 16.50 16.10 16.40 14.70 14.75July 12.57 13.42 12.34 16.00 15.60 15.90 14.15 14.25June 13.28 14.67 13.57 17.25 16.85 17.15 15.55 15.60May 13.50 15.04 13.94 17.55 17.15 17.45 15.95 16.00April 14.68 15.38 14.28 17.85 17.45 17.75 16.30 16.35March 15.22 15.28 14.08 17.95 17.55 17.85 16.40 16.30Feb. 15.68 15.02 13.77 17.90 17.55 17.80 16.40 16.00Jan. 15.74 14.24 13.19 16.90 16.55 16.80 15.40 15.20




MIDEAST WEST AFRICAQatar f Oman r Yemen f Nigeria a

Marine Dukhan Oman Marib Masila Light-36 Bonny Medium Forcados1996 (Far East) (Far East)Sept. 21.66 21.75 21.20 22.45 22.10 23.29 22.96 23.09Aug. 19.84 19.93 19.60 20.46 20.11 21.27 20.88 21.10July 18.96 19.05 18.77 19.55 19.20 19.89 19.47 19.59June 18.37 18.45 18.24 18.69 18.35 18.74 18.53 18.66May 18.04 18.15 17.89 19.49 19.14 19.72 19.49 19.62April 18.69 18.79 18.63 21.22 20.87 21.44 21.32 21.44March 17.83 17.93 17.77 19.79 19.39 20.68 20.54 20.70Feb. 16.80 16.90 16.50 17.89 17.49 18.64 18.54 18.64Jan. 17.53 17.63 17.26 17.97 17.57 17.93 17.77 17.90



1993Dec. 13.25 13.48 12.68 13.84 11.59 14.03 13.86 14.11Nov. 14.70 14.95 14.64 15.39 13.14 15.23 15.03 15.29Oct. 15.70 15.98 15.26 16.84 14.59 16.69 16.49 16.74Sept. 14.95 15.25 14.60 16.31 ... 16.51 16.31 16.56Aug. 15.81 15.96 15.46 17.01 ... 17.28 16.86 17.06July 15.56 15.71 15.21 17.08 ... 17.24 16.82 17.02June 16.81 16.96 16.46 17.98 ... 17.75 17.60 17.75May 17.08 17.23 16.70 18.86 ... 18.85 18.55 18.65April 17.40 17.55 17.05 19.04 ... 19.24 18.77 18.92March 17.30 17.45 16.95 19.14 ... 19.22 18.82 18.94Feb. 17.15 17.30 16.80 18.90 ... 19.00 18.45 18.66Jan. 16.54 16.69 15.84 17.79 ... 17.94 17.19 17.34

f Formula. r Retrospective. s Spot.f Formula. r Retrospective. s Spot.



WEST AFRICA MEDITERRANEANNigeria a Angola s Gabon s Algeria s Libya f

Brass Qua1996 River Escravos Iboe Cabinda Mandji Saharan Es Sider SarirSept. 23.33 23.26 23.29 21.70 20.90 23.05 22.42 22.07Aug. 21.30 21.23 21.27 20.00 18.75 20.90 20.41 20.06July 19.93 19.85 19.89 19.10 17.95 20.15 19.50 19.15June 18.77 18.68 18.74 17.85 16.70 18.90 18.59 18.09May 19.74 19.69 19.72 18.55 18.10 19.75 19.36 18.89April 21.46 21.41 21.44 20.40 20.05 21.65 21.30 20.70March 20.66 20.63 20.68 19.75 19.30 21.10 19.97 19.32Feb. 18.64 18.61 18.64 17.45 16.85 18.60 18.12 17.37Jan. 17.99 17.90 17.93 17.40 16.75 18.65 18.12 17.42


1994Dec. 15.86 15.76 15.81 14.90 14.55 16.30 15.80 15.11Nov. 17.48 17.36 17.41 16.40 16.00 17.65 16.97 16.33Oct. 16.92 16.85 16.90 15.55 15.10 16.90 16.29 15.79Sept. 16.11 16.06 16.11 15.05 14.25 16.00 15.41 15.01Aug. 16.57 16.44 16.49 15.90 15.10 16.80 15.96 15.56July 18.18 18.06 18.11 16.65 15.75 17.70 17.23 16.78June 17.41 17.23 17.28 15.90 14.95 16.90 16.50 16.00May 16.79 16.61 16.66 15.45 14.55 16.55 16.04 15.39April 16.02 15.82 15.87 14.55 13.50 15.60 15.11 14.41March 14.67 14.41 ... 13.30 12.25 14.45 13.66 12.90Feb. 14.22 14.01 ... 13.00 12.10 14.50 13.20 12.35Jan. 15.07 14.82 ... 13.15 12.40 15.00 13.95 13.30

1993Dec. 14.21 13.98 ... 12.05 11.65 14.20 12.93 12.33Nov. 15.40 15.18 ... 13.65 13.10 15.80 14.44 13.83Oct. 16.79 16.64 ... 15.35 14.50 17.10 15.88 15.28Sept. 16.61 16.46 ... 14.75 13.70 16.60 15.50 14.90Aug. 17.38 17.23 ... 15.40 14.30 17.35 16.15 15.55July 17.34 17.19 ... 15.55 14.65 17.30 16.19 15.59June 17.92 17.70 ... 16.52 15.40 17.70 16.95 16.30May 18.95 18.80 ... 17.60 16.20 18.85 17.95 17.20April 19.34 19.19 ... 17.71 16.15 19.05 18.20 17.40March 19.28 19.17 ... 17.44 16.10 19.10 18.27 17.42Feb. 19.00 18.95 ... 17.16 15.65 18.90 18.10 17.25Jan. 17.94 17.89 ... 15.81 14.60 17.80 17.12 16.27




MEDITERRANEANLibya f Egypt p

Suez Belayim Gharib Ras1996 Amna Brega Siritca Zueitina Blend Blend Blend BudranSept. 22.02 22.87 22.47 22.87 20.30 19.55 18.55 19.35Aug. 20.01 20.86 20.46 20.86 18.16 17.51 16.51 17.31July 19.10 19.95 19.55 19.95 17.15 16.45 15.35 16.25June 18.04 18.94 18.64 18.94 16.75 16.02 14.90 15.80May 18.84 19.77 19.51 19.77 17.69 16.96 15.90 16.81April 20.65 21.55 21.35 21.55 19.62 18.89 17.83 18.74March 19.27 20.22 20.02 20.22 18.44 17.74 16.69 17.59Feb. 17.32 18.27 18.15 18.27 16.62 15.97 14.92 15.82Jan. 17.37 18.27 18.15 18.27 16.52 15.77 14.87 15.62




f Formula. r Retrospective. s Spot. p Posting based on a formula.



MEDITERRANEAN NORTH EUROPESyria USSR s UK s Norway s USSR s

Urals Brent Urals1996 Souedieh Light f (c.i.f.) Blend Forties Ekofisk Statfjord (c.i.f.)Sept. 20.01 22.46 21.65 22.55 22.70 22.65 22.60 22.05Aug. 17.90 20.25 19.70 20.55 20.75 20.75 20.70 20.00July 16.57 18.84 18.55 19.60 19.90 20.00 19.95 18.95June 15.91 18.16 17.25 18.40 18.70 19.10 19.12 17.90May 16.51 18.63 18.35 19.10 19.55 19.50 19.55 18.80April 18.24 20.86 20.15 20.90 21.50 21.45 21.45 20.75March 17.65 20.20 20.15 20.30 20.85 20.95 18.35 20.55Feb. 15.56 18.31 17.80 17.90 18.30 18.45 18.70 18.10Jan. 14.81 17.57 18.05 17.90 18.25 18.30 21.15 17.90







FAR EASTIndonesia p

Arun1996 Minas Duri Cinta Handil Widuri Ardjuna Attaka Cond.Sept. 21.02 19.46 20.43 20.90 20.35 21.21 22.07 21.04Aug. 19.49 17.97 19.01 19.43 18.93 19.68 20.21 19.41July 19.71 18.18 19.11 19.45 19.05 19.68 20.21 19.36June 19.28 18.12 18.64 19.01 18.57 19.24 19.79 18.96May 18.94 18.16 18.34 18.82 18.27 19.16 19.73 18.87April 19.19 17.60 18.59 18.92 18.53 19.17 19.85 19.12March 19.19 17.60 18.59 18.92 18.53 19.17 19.85 19.12Feb. 18.87 17.17 18.23 18.44 18.19 18.73 19.31 18.57Jan. 19.35 17.72 18.70 18.81 18.67 19.07 19.59 18.92




f Formula. r Retrospective. s Spot. p Posting.



FAR EAST N. AMERICAChina r Malaysia r Brunei r Papua US p

Tapis Miri New Guinea s West Texas1996 Daqing Blend Labuan Light Seria Champion Kutubu Int.Sept. 20.70 23.01 21.19 22.91 22.20 22.00 21.20 23.13Aug. 19.13 21.19 21.29 21.09 21.05 20.85 20.90 21.05July 19.23 20.86 20.96 20.76 21.10 20.90 19.84 20.95June 18.88 20.66 20.76 20.56 20.55 20.35 19.60 19.75May 18.59 20.58 20.68 20.48 20.60 20.40 19.48 18.50April 19.00 21.25 21.35 21.15 21.75 21.55 19.48 20.00March 18.89 21.61 21.71 20.95 21.65 21.45 19.93 19.70Feb. 18.53 21.05 21.15 21.51 21.20 21.00 19.54 17.45Jan. 19.01 20.89 20.99 20.79 20.85 20.65 19.67 17.83







NORTH AMERICAUS p Canada p Mexico f

West Texas ANS ANS Louisiana Light Alberta Isthmus1996 Sour (Gulf) (Calif.) Sweet Wilmington Lloydminster Light (W. Hemis.)Sept. 21.94 ... 21.20 23.23 22.00 19.00 24.34 22.56Aug. 19.80 ... 19.10 21.10 20.00 17.40 22.62 20.50July 19.95 ... 19.20 21.10 19.15 15.56 19.70 19.63June 17.75 ... 19.05 19.00 19.30 16.00 19.00 18.68May 16.50 ... 22.16 18.00 19.30 16.00 19.00 19.64April 18.00 ... 20.35 19.25 19.30 15.30 19.75 21.58March 17.70 17.98 17.80 18.35 15.30 14.30 19.25 19.94Feb. 15.45 17.60 17.29 18.07 15.30 13.72 18.95 17.87Jan. 15.83 17.59 17.01 17.83 14.15 13.35 17.78 17.51



1993Dec. 10.61 14.32 13.10 12.86 9.10 9.78 14.24 12.11Nov. 12.82 16.02 15.44 15.07 9.75 12.08 16.49 13.58Oct. 14.31 15.57 15.00 16.56 11.90 13.62 17.94 15.25Sept. 13.58 16.22 15.45 15.83 11.90 12.47 17.20 15.19Aug. 14.95 15.89 14.89 17.10 12.40 12.68 17.73 15.18July 13.94 17.00 16.05 16.19 11.90 12.48 17.62 15.41June 15.31 17.99 17.45 17.56 12.40 13.94 19.00 16.38May 16.24 18.30 18.21 18.49 14.50 14.52 19.66 17.59April 16.62 18.34 17.37 18.87 14.50 14.67 19.93 17.81March 16.71 17.90 16.78 18.96 13.47 ... 19.91 17.87Feb. 16.50 16.59 15.61 18.75 12.89 ... 19.82 17.53Jan. 15.51 17.19 16.33 17.88 12.60 ... 18.67 16.57




NORTH AMERICAMexico f

Isthmus Isthmus Isthmus Maya Maya Maya Maya Olmeca1996 (Europe) (Far East) (Average)* (W. Hemis.) (Europe) (Far East) (Average)*Sept. 21.53 21.10 ... 19.21 19.03 17.85 ... 23.52Aug. 19.92 19.38 19.69 17.11 16.55 16.38 17.15 21.31July 18.60 18.65 19.11 16.08 14.77 15.35 15.98 20.41June 17.58 18.00 18.09 15.77 13.70 15.20 14.89 19.44May 18.48 17.85 18.66 15.98 14.90 15.20 15.36 20.29April 19.17 18.52 19.76 18.00 16.19 15.87 16.69 22.07March 20.09 17.71 19.96 16.53 16.58 15.21 16.54 20.58Feb. 18.42 16.82 17.94 15.07 15.44 14.47 15.12 18.47Jan. 16.47 17.37 17.37 14.67 13.88 15.12 14.57 18.35

1995Dec. 17.91 17.61 17.48 15.18 15.56 15.56 15.23 18.38Nov. 15.76 16.24 16.20 13.53 12.95 13.99 13.45 17.31Oct. 15.03 15.47 15.46 13.01 12.47 13.12 12.90 16.60Sept. 15.09 16.19 16.04 13.54 13.48 13.80 13.54 16.92Aug. 15.50 16.12 16.00 13.44 13.28 13.52 13.41 16.69July 14.96 15.84 15.60 13.28 12.91 13.49 13.22 16.36June 15.71 16.10 16.49 14.86 12.99 12.99 14.39 17.44May 17.68 18.09 18.19 16.26 15.61 16.04 15.83 18.97April 18.16 18.38 18.45 16.08 15.88 ... ... 19.10March 16.82 17.31 16.86 14.84 15.17 14.91 14.91 17.46Feb. 17.13 17.59 16.91 14.78 15.50 ... ... 17.37Jan. 17.05 17.04 16.53 14.02 15.32 ... ... 17.10

1994Dec. 16.44 16.98 16.27 13.84 15.53 14.08 14.19 16.83Nov. 15.78 17.03 16.66 14.08 14.41 13.93 14.14 17.15Oct. 15.86 16.37 15.89 13.63 14.60 ... ... 16.83Sept. 15.41 16.20 15.72 12.37 12.78 16.34Aug. 14.82 16.93 15.77 12.95 12.05 17.07July 17.27 17.40 17.33 14.74 14.72 14.50 14.61 18.18June 17.22 16.77 16.85 13.85 14.28 13.32 13.80 17.57May 15.98 15.57 16.12 12.56 13.01 16.95April 15.07 14.67 14.94 11.76 12.32 10.72 11.52 15.78March 14.54 13.20 13.42 10.19 10.97 9.20 9.98 13.97Feb. 12.79 13.67 12.95 9.57 10.33 9.15 9.92 13.25Jan. 13.67 14.04 13.33 9.83 9.71 9.14 10.22 13.85

1993Dec. 12.50 13.16 12.37 9.07 8.88 9.31 9.04 13.49Nov. 13.80 14.73 13.81 9.99 9.09 10.03 9.81 15.04Oct. 14.53 15.73 15.14 11.54 10.12 11.13 11.24 16.73Sept. 15.01 15.12 15.13 11.86 10.10 10.32 11.43 16.30Aug. 14.37 15.78 15.07 11.74 9.75 10.68 11.29 16.76July 14.81 15.55 15.28 11.59 9.71 ... 11.03 16.68June 14.65 16.77 16.01 11.71 9.26 11.62 11.22 17.81May 16.29 17.15 17.20 12.93 10.21 12.00 12.34 18.94April 17.85 17.45 17.77 13.66 11.61 12.34 13.05 19.14March 16.91 17.44 17.57 13.36 11.80 12.09 12.98 19.18Feb. 16.98 17.26 17.35 12.90 11.57 11.76 12.58 19.04Jan. 16.07 16.37 16.42 12.33 10.71 11.27 11.95 17.92




SOUTH AMERICAVenezuela Colombia f Ecuador f

Bachaquero p BCF-17 p BCF-21.9 p Furrial f Cano Limon Cusiana Oriente1996 (US) (US) (US) (US)Sept. ... 17.80 18.43 21.69 22.19 23.74 20.63Aug. ... 17.19 17.00 19.70 20.00 21.60 18.62July ... 14.56 14.47 19.12 19.37 20.87 18.05June ... 16.25 16.88 18.56 18.71 20.16 16.55May ... 17.19 17.82 19.69 20.09 21.09 19.36April ... 18.58 19.25 22.12 22.52 23.67 19.54March ... 16.58 17.21 20.17 20.32 19.90 17.63Feb. ... 14.24 14.87 17.88 17.93 18.05 15.30Jan. ... 15.25 15.88 17.57 17.67 18.05 14.81

1995Dec. ... 14.00 14.73 16.60 17.55 18.63 14.73Nov. ... 13.34 13.93 15.79 16.39 17.49 13.64Oct. ... 13.16 13.79 15.24 15.74 16.78 13.68Sept. 12.30 13.56 14.19 15.80 16.50 17.45 14.43Aug. 12.84 13.44 14.08 15.58 16.37 17.45 14.59July 13.15 13.93 14.46 14.52 15.72 16.62 14.03June 14.29 15.73 16.26 15.71 16.84 ... 15.12May 15.22 16.88 17.49 16.92 18.14 ... 16.38April 14.86 16.09 16.95 ... 18.24 ... 16.47March 13.77 15.04 16.07 ... 16.97 ... 15.14Feb. 13.13 14.63 15.66 ... 16.81 ... 15.21Jan. 12.57 14.01 15.04 ... 16.31 ... 14.73

1994Dec. 12.58 13.90 14.84 ... 15.17 ... 13.68Nov. 12.78 14.75 15.78 ... 16.09 ... 14.42Oct. 12.09 13.16 14.19 ... 15.76 ... 13.58Sept. 10.92 12.17 13.20 ... 15.45 ... 13.64Aug. 11.21 12.40 13.38 ... 16.41 ... 14.73July 12.93 14.23 15.39 ... 17.16 ... 15.31June 12.25 13.67 14.98 ... 16.70 ... 14.77May 11.87 12.88 14.19 ... 16.54 ... 14.68April 10.53 11.61 12.85 ... 14.97 ... 13.31March 9.21 9.97 11.27 ... 12.67 ... 11.58Feb. 9.46 10.29 11.60 ... 12.35 ... 11.49Jan. 9.03 9.74 11.01 ... 12.68 ... 11.23

1993Dec. 8.93 9.63 10.78 ... 12.11 ... 10.18Nov. 10.31 11.02 12.33 ... 14.07 ... 12.07Oct. 11.63 12.58 13.89 ... 15.73 ... 13.88Sept. 11.30 12.08 13.30 ... 14.88 ... 13.41Aug. 11.30 12.25 13.64 ... 15.28 ... 14.16July 10.68 11.48 12.87 ... 14.99 ... 13.66June 11.63 12.63 14.02 ... 16.64 ... 14.84May 12.46 13.46 14.85 ... 17.55 ... 15.77April 12.29 13.29 14.89 ... 17.79 ... 16.42March 12.29 13.43 15.01 ... 17.87 ... 16.59Feb. 11.85 12.75 14.14 ... 17.58 ... 16.52Jan. 11.44 12.21 13.39 ... 16.43 ... 15.20



SCORECARD UPDATE � 4TH QUARTER 1996

PIW SCORECARD � COSTS TO REFINERSOF KEY FORMULA PRICED CRUDES IN PRIMARY WORLD MARKETS

DELIVERED TO ROTTERDAMArab Arab Arab Arab Arab Arab Arab Arab

Point Extra Light Light Medium Heavy Extra Light Light Medium HeavyOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (Sidi Kerir) (Sidi Kerir) (Sidi Kerir) (Sidi Kerir)Dec. 24.08 23.17 22.08 21.55 23.58 22.73 21.53 20.98Nov. 22.90 22.09 21.17 20.75 22.66 21.91 20.66 20.06Oct. 24.07 23.29 22.41 22.03 23.99 23.14 22.19 21.74Sept. 22.24 21.47 20.54 20.20 22.25 21.45 20.55 20.15Aug. 20.49 19.76 18.90 18.58 20.26 19.46 18.56 18.16July 19.89 19.29 18.57 18.27 19.50 18.70 17.80 17.40

Kuwait Iran Iran Nigeria Nigeria Libya Market Link:Point Kuwait Light Heavy Bonny Lt. Forcados Es Sider Brent (f.o.b.)Of Sale: (f.o.b.) (c.i.f.) (c.i.f.) (f.o.b.) (f.o.b.) (f.o.b.) (Sullom Voe)Dec. 22.08 23.13 22.33 25.24 25.25 24.58 23.80Nov. 21.17 22.21 21.41 24.45 24.46 23.35 22.75Oct. 22.41 23.44 22.64 25.08 24.97 24.52 24.15Sept. 20.58 21.85 21.05 23.05 22.82 22.96 22.55Aug. 18.93 19.86 19.06 21.19 20.94 20.97 20.55July 18.58 18.95 18.15 20.69 20.43 20.19 19.60

DELIVERED TO US GULF COASTArab Arab Arab Arab Arab Arab Arab Arab Kuwait

Point Extra Light Light Medium Heavy Extra Light Light Medium Heavy KuwaitOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (c.i.f.) (c.i.f.) (c.i.f.) (c.i.f.) (c.i.f.)Dec. 23.23 22.40 21.53 20.98 24.20 23.35 22.50 21.90 22.50Nov. 22.50 21.76 20.95 20.46 22.65 22.00 21.10 20.45 21.10Oct. 23.64 22.98 22.27 21.85 23.81 23.01 22.16 21.61 22.16Sept. 22.99 22.37 21.70 21.28 22.53 21.78 20.98 20.48 20.98Aug. 21.11 20.47 19.70 19.18 20.75 20.10 19.45 19.05 19.45July 20.56 19.92 19.09 18.52 20.26 19.61 18.86 18.36 18.86

Nigeria Nigeria Mexico Mexico Mexico Col. Cano Ecuador Market Link:Point Bonny Lt. Forcados Isthmus Maya Olmeca Limon Oriente WTIOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (Cushing)Dec. 25.06 25.13 23.89 19.84 25.28 24.49 21.64 25.10Nov. 24.33 24.40 22.71 19.46 23.89 23.01 20.02 23.55Oct. 25.01 24.96 24.04 21.34 25.18 24.02 21.05 24.90Sept. 23.01 22.84 22.48 19.19 23.47 22.41 21.10 23.90Aug. 21.19 21.00 20.58 17.22 21.40 20.48 19.40 21.90July 20.64 20.43 19.90 16.43 20.75 20.11 19.20 21.25

TO SINGAPORE (Delivered)Arab Arab Arab Arab Arab Iran Iran Market Links (f.o.b.):

Point Super Lt. Ex. Lt. Light Medium Heavy Light Heavy Dubai OmanOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) Fateh SpotDec. 24.77 23.93 22.92 21.95 21.16 22.61 21.86 21.65 22.05Nov. 24.47 23.50 22.69 21.77 21.05 22.40 21.68 20.95 21.30Oct. 23.79 22.82 21.98 20.99 20.30 21.72 20.90 21.75 21.95Sept. 22.15 21.34 20.50 19.46 18.88 20.25 19.38 20.30 20.80Aug. 21.19 20.53 19.69 18.60 18.04 19.44 18.52 18.55 19.10July 20.42 19.76 18.93 17.90 17.39 18.67 17.82 17.75 18.45





Super Light Extra Light Extra Light Extra Light Extra Light Light Light Light(Far East) (Europe) (US) (Far East) (Average)* (Europe) (US) (Far East)

Dec. 24.82 ... ... 23.92 ... ... ... 22.82Nov. 23.84 23.41 23.55 22.99 23.17 22.51 22.70 22.04Oct. 24.33 22.27 22.12 23.33 22.89 21.41 21.32 22.48Sept. 22.38 22.36 21.15 21.38 21.65 21.55 20.40 20.53Aug. 21.06 21.60 21.62 20.36 20.76 20.79 20.96 19.51July 20.23 19.92 20.48 19.53 19.74 19.11 19.82 18.68

Saudi Arabia f

Light Medium Medium Medium Medium Heavy Heavy Heavy(Average)* (Europe) (US) (Far East) (Average)* (Europe) (US) (Far East)

Dec. ... ... ... 21.77 ... ... ... 20.92Nov. 22.32 21.26 21.80 21.14 21.34 20.66 21.15 20.39Oct. 21.92 20.45 20.47 21.53 21.00 20.00 19.92 20.83Sept. 20.67 20.65 19.59 19.48 19.77 20.24 19.09 18.78Aug. 20.35 19.88 20.31 18.46 19.60 19.47 19.90 17.97July 19.28 18.20 19.06 17.53 18.43 17.79 18.56 16.88

Saudi Arabia f Iran f IraqHeavy Light Light Light Heavy Heavy Heavy Kirkuk

(Average)* (Europe) (Far East) (Average)* (Europe) (Far East) (Average)* (US)Dec. ... 22.59 22.48 22.54 22.09 21.65 21.89 22.42Nov. 20.84 21.77 21.71 21.74 21.27 21.03 21.16 ...Oct. 20.17 22.78 22.19 22.52 22.25 21.41 21.88 ...Sept. 19.26 21.49 20.24 20.93 20.96 19.36 20.24 ...Aug. 19.43 19.68 19.23 19.48 19.01 18.35 18.71 ...July 18.07 18.13 18.40 18.25 17.28 17.42 17.34 ...

Iraq Kuwait f Neutral Zone f Abu Dhabi r

Kirkuk Basrah Kuwait Kuwait Kuwait Khafji Umm(Europe) (Far East) (Europe) (US) (Far East) (Far East) Murban Shaif

Dec. 22.25 22.05 ... ... 21.67 20.92 24.20 23.95Nov. ... ... 21.26 ... 21.04 20.39 23.10 22.85Oct. ... ... 20.45 ... 21.43 20.83 23.80 23.55Sept. ... ... 20.65 ... 19.38 18.78 22.30 22.00Aug. ... ... 19.88 ... 18.36 17.97 20.45 20.15July ... ... 18.20 ... 17.43 16.88 19.55 19.25

Abu Dhabi r Dubai s Qatar f Oman r Yemen f

Upper Marine Dukhan MaribZakum Zakum Fateh (Far East) (Far East) Oman (Average)* Masila

Dec. 24.25 22.10 21.65 22.41 22.48 22.82 23.68 23.33Nov. 23.15 21.20 20.95 22.42 22.49 21.80 22.99 22.64Oct. 23.85 21.95 21.75 21.73 21.81 22.50 23.94 23.59Sept. 22.35 20.55 20.30 21.66 21.75 21.20 22.45 22.10Aug. 20.50 18.75 18.55 19.84 19.93 19.60 20.46 20.11July 19.65 17.85 17.75 18.96 19.05 18.77 19.55 19.20





WEST AFRICANigeria Angola s Gabon s

Bonny Bonny Brass QuaLight Forcados Medium River Escravos Iboe Cabinda Mandji


MEDITERRANEANAlgeria s Libya f Egypt p

SuezSaharan Es Sider Sarir Amna Brega Siritca Zueitina Blend


MEDITERRANEAN NORTH EUROPEEgypt p Syria USSR s UK s

Belayim Gharib Ras Urals BrentBlend Blend Budran Souedieh Light f (c.i.f.) Blend Forties


NORTH EUROPE FAR EASTNorway s USSR s Indonesia p

UralsEkofisk Statfjord (c.i.f.) Minas Duri Cinta Handil Widuri


FAR EASTIndonesia p China r Malaysia r Brunei r

Arun Tapis MiriArdjuna Attaka Cond. Daqing Blend Labuan Light Seria






FAR EAST NORTH AMERICABrunei r Papua US p

New Guinea West Texas West Texas ANS ANS Louisiana LightChampion Kutubu Int. Sour (Gulf) (Calif.) Sweet Wilmington

Dec. 25.05 22.55 23.84 21.84 ... 21.36 24.46 19.13Nov. 26.00 22.19 22.38 20.38 ... 22.61 23.18 17.47Oct. 24.60 24.10 23.71 21.71 ... 21.70 24.44 18.14Sept. 22.00 21.20 23.13 21.94 ... 21.20 23.23 16.83Aug. 20.85 20.90 21.05 19.80 ... 19.10 21.10 15.31July 20.90 19.84 20.95 19.95 ... 19.20 21.10 15.15

NORTH AMERICACanada p Mexico (Formula, Retrospective) c

Alberta Isthmus Isthmus Isthmus Isthmus Maya MayaLloydminster Light (W. Hemis.) (Europe) (Far East) (Average)* (W. Hemis.) (Europe)


NORTH AMERICA SOUTH AMERICAMexico (Formula, Retrospective) c Venezuela p

Maya Maya Furrial(Far East) (Average)* Olmeca Bachaquero (US) BCF-17 BCF-21.9

Dec. 18.95 19.29 25.04 ... 23.36 21.15 22.08Nov. 18.42 18.87 23.54 ... 21.82 21.15 22.08Oct. 19.25 20.64 24.77 ... 22.98 20.87 21.80Sept. 17.85 19.04 23.52 ... 21.69 17.80 18.43Aug. 16.38 16.92 21.31 ... 19.70 17.19 17.00July 15.35 15.98 20.41 ... 19.12 14.56 14.47

SOUTH AMERICAColombia f Ecuador f

Cano Limon Cusiana Oriente(US) (US) (US)

Dec. 23.60 25.45 22.26Nov. 22.42 24.12 20.54Oct. 23.33 24.83 21.61Sept. 22.19 23.74 20.63Aug. 20.00 21.60 18.62July 19.37 20.87 18.05



TO EUROPE Current Price TimingPoint Market From Loading Adjustment Factors

Country/Crude Oil Of Sale Link a (In Days) b Jan. Dec. Nov.Saudi Arabia Extra Light f.o.b. Brent 40 -1.00 -1.00 -0.70

Light f.o.b. Brent 40 -1.85 -1.60 -1.70Medium f.o.b. Brent 40 -3.05 -3.05 -2.85Heavy f.o.b. Brent 40 -3.60 -3.60 -3.45Extra Light Sidi Kerir Brent 0 -0.30 -0.30 0.00Light Sidi Kerir Brent 0 -1.15 -1.15 -0.90Medium Sidi Kerir Brent 0 -2.35 -2.35 -2.15Heavy Sidi Kerir Brent 0 -2.90 -2.90 -2.75

Kuwait f.o.b. Brent 40 -3.05 -3.05 -2.85Iran Light Rotterdam Brent Delivery c -0.75 -0.75 -0.60

Heavy Rotterdam Brent Delivery c -1.55 -1.55 -1.40Light f.o.b. Brent 0 -1.30 -1.30 -1.25Heavy f.o.b. Brent 0 -1.80 -1.80 -1.75

Iraq Kirkuk Ceyhan Brent 5 -1.55 -1.55 ...Yemen Marib f.o.b. Brent 0 -0.30 -0.20 -0.20

Masila f.o.b. Brent 0 -0.97 -0.55 -0.55Nigeria Bonny Light f.o.b. Brent 5 +0.50 +0.45 +0.63

Bonny Medium f.o.b. Brent 5 +0.50 +0.40 +0.63Forcados f.o.b. Brent 5 +0.60 +0.50 +0.70Qua Iboe f.o.b. Brent 5 +0.50 +0.43 +0.63Brass River f.o.b. Brent 5 +0.38 +0.41 +0.63Escravos f.o.b. Brent 5 +0.38 +0.40 +0.60

Libya Es Sider f.o.b. Brent 0 +0.10 +0.10 +0.10Sarir f.o.b. Brent 0 -0.55 -0.55 -0.50Amna f.o.b. Brent 0 -0.60 -0.60 -0.55Brega f.o.b. Brent 0 +0.40 +0.40 +0.45Sirtica f.o.b. Brent 0 +0.15 +0.15 +0.15Zueitina f.o.b. Brent 0 +0.40 +0.45 +0.45

Syria Light f.o.b. Brent 5 -0.35 -0.05 -0.05Souedieh f.o.b. Brent 5 -4.75 -4.75 -3.90

Egypt Suez Blend f.o.b. Brent 0 -2.10 -2.35 -2.10Belayim Blend f.o.b. Brent 0 -3.35 -3.20 -3.15Gharib Blend f.o.b. Brent 0 -4.20 -4.00 -4.00Ras Budran f.o.b. Brent 0 -3.65 -3.50 -3.35

Mexico Isthmus f.o.b. ((DBx0.887+ 0 -0.06 -0.06 0.06(3.5%FOx0.113)-

(0.16x(1%FO-3.5%FO))Maya f.o.b. ((DBx0.527)+ 0 -1.75 -1.60 -1.40

(3.5%FOx0.467)-(0.25x(1%FO-3.5%FO)))


HHooww TTeerrmm--CCoonnttrraacctt PPrriicceess AArree CCaallccuullaatteeddTerm-contract formulas generally have four basic components: the point of sale, a

market-related benchmark, an adjustment factor for differences related to crude oil

quality and point of sale, and a timing mechanism stipulating when the value of the

formula is to be calculated. The adjustment factor in the formula is applied to a spot-mar-ket or other benchmark, say dated Brent, at a designated time relative to the loading of thecargo. In many formulas, the �snapshot� of the benchmark grade�s value is taken on oraround the day of loading. In other cases, the trigger point is set to reflect the transit timeto the end-user�s market.

A PROFILE OF THE LATEST CRUDE OIL PRICE FORMULAS


TO FAR EAST Current Price TimingPoint Market From Loading Adjustment Factors

Country/Crude Oil Of Sale Link a (In Days) b Jan. Dec. Nov.Saudi Arabia Super Light f.o.b. (O+D)/2 0 +2.75 +2.75 +2.40

Extra Light f.o.b. (O+D)/2 0 +2.00 +1.85 +1.55Light f.o.b. (O+D)/2 0 +0.75 +0.75 +0.60Medium f.o.b. (O+D)/2 0 -0.30 -0.30 -0.30Heavy f.o.b. (O+D)/2 0 -1.15 -1.15 -1.05

Iran Light f.o.b. O+((77¢-(O-D))/2) 0 +0.08 +0.03 +0.12Heavy f.o.b. D-((77¢-(O-D))/2) 0 -0.03 -0.03 -0.03

Kuwait f.o.b. (O+D)/2 0 -0.40 -0.40 -0.40Neutral Zone Khafji f.o.b. (O+D)/2 0 -1.15 -1.15 -1.05Qatar Dukhan f.o.b. Oman MPM 0 ... +0.68 +0.69

Marine f.o.b. Oman MPM 0 ... +0.61 +0.62Iraq Basrah f.o.b. (O+D)/2 0 0.20 0.20 ...Yemen Marib f.o.b. Brent 0 -0.30 -0.20 -0.20

Masila f.o.b. Brent 0 -0.97 -0.55 -0.55Mexico Isthmus f.o.b. (O+D)/2 0 +0.75 +0.75 +0.60

Maya f.o.b. (O+D)/2 0 -3.20 -2.90 -2.70

TO UNITED STATES Current Price TimingPoint Market From Loading Adjustment Factors

Country/Crude Oil Of Sale Link a (In Days) b Jan. Dec. Nov.Saudi Arabia Extra Light f.o.b. WTI 50 -1.90 -2.10 -2.00

Light f.o.b. WTI 50 -2.80 -2.95 -2.85Medium f.o.b. WTI 50 -3.65 -3.80 -3.75Heavy f.o.b. WTI 50 -4.25 -4.40 -4.40Extra Light US Gulf WTI Delivery c -0.70 -0.90 -0.80Light US Gulf WTI Delivery c -1.60 -1.75 -1.65Medium US Gulf WTI Delivery c -2.45 -2.60 -2.55Heavy US Gulf WTI Delivery c -3.05 -3.20 -3.20

Kuwait US Gulf WTI Delivery c -2.45 -2.60 -2.55Iraq Basrah f.o.b. ... 15 -3.60 -3.75 ...Iraq Kirkuk Ceyhan ... 10 -2.85 -3.00 ...Nigeria Bonny Light f.o.b. Brent 5 +0.50 +0.45 +0.63

Bonny Medium f.o.b. Brent 5 +0.50 +0.40 +0.63Forcados f.o.b. Brent 5 +0.60 +0.50 +0.70Qua Iboe f.o.b. Brent 5 +0.50 +0.43 +0.63Brass River f.o.b. Brent 5 +0.38 +0.41 +0.63Escravos f.o.b. Brent 5 +0.38 +0.40 +0.60

Mexico Isthmus f.o.b. (0.4x(WTS+LLS))+ 0 -1.00 -0.90 -1.00(0.2xDB)

Maya f.o.b. (0.4x(WTS+3%FO)) + 0 -1.75 -1.75 -1.60(0.1x(LLS+DB))

Olmeca f.o.b. (WTS+LLS+DB)/3 0 +0.45 +0.45 +0.30Colombia Cano Limon f.o.b. WTI 0 -1.40 -1.50 -1.45

Cusiana f.o.b. WTI 0 +0.40 +0.35 +0.25Ecuador Oriente d f.o.b. WTS 0 -3.41 -3.41 -3.41Venezuela Furrial f.o.b. WTI 0 -2.00 -2.15 -2.05

a Abbreviations used in defining market linkage: Brent and DB: Dated Brent; FO: Residual fuel oil in market of crude oil sale withpercentage referring to sulfur content; O: Oman spot price; D: Dubai spot price; Oman MPM: Oman official posting; WTI: WestTexas Intermediate spot price at Cushing; WTS: West Texas Sour spot price; LLS: Light Louisiana Sweet spot price. b The mar-ket linkage is calculated at the time indicated below based on an average over a period of days. For Europe, averages are usu-ally a 5-day period, except for Saudi f.o.b. sales which are 10 days. For Far East sales, all averages are for the calendar monthof loading. For US sales, the averages are usually for 5 days. c Delivery: Price triggered on day that the crude oil is unloadedin the buyers regional market. d Ecuador changed from WTI to WTS linkage in Nov. 1996.


A PROFILE OF THE LATEST CRUDE OIL PRICE FORMULAS (cont.)


SCORECARD UPDATE � 1ST QUARTER 1997

PIW SCORECARD � COSTS TO REFINERSOF KEY FORMULA PRICED CRUDES IN PRIMARY WORLD MARKETS

DELIVERED TO ROTTERDAMArab Arab Arab Arab Arab Arab Arab Arab

Point Extra Light Light Medium Heavy Extra Light Light Medium HeavyOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (Sidi Kerir) (Sidi Kerir) (Sidi Kerir) (Sidi Kerir)March 19.24 18.40 17.12 16.54 18.77 17.87 16.57 15.92Feb. 21.38 20.55 19.37 18.84 20.70 19.75 18.45 17.80Jan. 23.67 22.82 21.63 21.08 23.17 22.32 21.12 20.57Dec. 24.03 23.18 22.03 21.50 23.56 22.71 21.51 20.96Nov. 22.90 22.09 21.17 20.75 22.66 21.91 20.66 20.06Oct. 24.07 23.29 22.41 22.03 23.99 23.14 22.19 21.74

Kuwait Iran Iran Nigeria Nigeria Libya Market Link:Point Kuwait Light Heavy Bonny Lt. Forcados Es Sider Brent (f.o.b.)Of Sale: (f.o.b.) (c.i.f.) (c.i.f.) (f.o.b.) (f.o.b.) (f.o.b.) (Sullom Voe)March 17.12 17.72 17.17 21.11 21.07 19.69 19.10Feb. 19.37 19.90 19.45 23.53 23.63 21.59 20.90Jan. 21.63 22.72 22.02 25.16 25.21 24.18 23.55Dec. 22.03 23.11 22.31 25.16 25.17 24.58 23.80Nov. 21.17 22.21 21.41 24.45 24.46 23.35 22.75Oct. 22.41 23.44 22.64 25.08 24.97 24.52 24.15

DELIVERED TO US GULF COASTArab Arab Arab Arab Arab Arab Arab Arab Kuwait

Point Extra Light Light Medium Heavy Extra Light Light Medium Heavy KuwaitOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (c.i.f.) (c.i.f.) (c.i.f.) (c.i.f.) (c.i.f.)March 20.26 19.35 18.50 17.89 19.95 18.95 17.90 16.90 17.90Feb. 21.40 20.56 19.73 19.15 21.28 20.28 19.38 18.68 19.38Jan. 24.34 23.52 22.67 22.07 24.43 23.53 22.68 22.08 22.68Dec. 24.18 23.46 22.60 22.02 24.20 23.35 22.50 21.90 22.50Nov. 22.50 21.76 20.95 20.46 22.65 22.00 21.10 20.45 21.10Oct. 23.64 22.98 22.27 21.85 23.81 23.01 22.16 21.61 22.16

Nigeria Nigeria Mexico Mexico Mexico Col. Cano Ecuador Market Link:Point Bonny Lt. Forcados Isthmus Maya Olmeca Limon Oriente WTIOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (Cushing)March 20.97 20.95 18.90 15.31 20.31 20.23 19.31 20.95Feb. 23.43 23.55 20.88 16.45 22.51 22.18 21.72 22.15Jan. 25.10 25.18 23.67 19.39 25.04 24.97 24.25 25.20Dec. 24.98 25.05 23.87 19.83 25.24 23.41 23.06 25.10Nov. 24.33 24.40 22.71 19.46 23.89 23.01 20.02 23.55Oct. 25.01 24.96 24.04 21.34 25.18 24.02 21.05 24.90

TO SINGAPORE (Delivered)Arab Arab Arab Arab Arab Iran Iran Market Links (f.o.b.):

Point Super Lt. Ex. Lt. Light Medium Heavy Light Heavy Dubai OmanOf Sale: (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) (f.o.b.) Fateh SpotMarch 22.25 21.36 20.00 18.98 18.14 19.74 18.92 18.10 18.95Feb. 24.07 23.13 21.82 20.78 19.94 21.56 20.75 18.75 19.55Jan. 25.10 24.31 23.14 22.10 21.26 22.86 22.04 21.45 21.75Dec. 24.62 23.78 22.77 21.80 21.01 22.46 21.71 21.65 22.05Nov. 24.47 23.50 22.69 21.77 21.05 22.40 21.68 20.95 21.30Oct. 23.79 22.82 21.98 20.99 20.30 21.72 20.90 21.75 21.95





Super Light Extra Light Extra Light Extra Light Extra Light Light Light Light(Far East) (Europe) (US) (Far East) (Average)* (Europe) (US) (Far East)

March 21.98 ... ... 20.48 ... ... ... 19.13Feb. 22.31 17.17 17.66 21.28 19.81 16.22 16.65 19.88Jan. 24.51 18.69 18.82 23.76 21.75 17.83 17.91 22.51Dec. 24.79 21.43 20.96 23.89 22.86 20.57 20.10 22.79Nov. 23.84 23.41 23.55 22.99 23.17 22.51 22.70 22.04Oct. 24.33 22.27 22.12 23.33 22.89 21.41 21.32 22.48

Saudi Arabia f

Light Medium Medium Medium Medium Heavy Heavy Heavy(Average)* (Europe) (US) (Far East) (Average)* (Europe) (US) (Far East)

March ... ... ... 18.13 ... ... ... 17.28Feb. 17.78 14.92 15.74 18.83 16.46 14.26 15.04 17.98Jan. 19.51 16.63 17.06 21.46 18.29 16.08 16.45 20.61Dec. 21.14 19.37 19.25 21.74 20.02 18.81 18.64 20.89Nov. 22.32 21.26 21.80 21.14 21.34 20.66 21.15 20.39Oct. 21.92 20.45 20.47 21.53 21.00 20.00 19.92 20.83

Saudi Arabia f Iran f IraqHeavy Light Light Light Heavy Heavy Heavy Kirkuk

(Average)* (Europe) (Far East) (Average)* (Europe) (Far East) (Average)* (US)March ... 17.05 18.84 17.86 16.55 18.01 17.21 17.75Feb. 15.47 19.05 19.60 19.30 18.55 18.78 18.65 19.05Jan. 17.21 22.04 22.23 22.13 21.54 21.40 21.74 22.35Dec. 19.13 22.60 22.46 22.53 22.10 21.63 21.89 22.42Nov. 20.84 21.77 21.71 21.74 21.27 21.03 21.16 ...Oct. 20.17 22.78 22.19 22.52 22.25 21.41 21.88 ...

Iraq Kuwait f Neutral Zone f Abu Dhabi r

Kirkuk Basrah Kuwait Kuwait Kuwait Khafji Umm(Europe) (Far East) (Europe) (US) (Far East) (Far East) Murban Shaif

March 17.38 18.57 ... ... 18.03 17.28 20.05 19.80Feb. 19.35 19.35 14.92 ... 18.73 17.98 20.85 20.60Jan. 22.00 21.80 16.63 ... 21.36 20.61 23.75 23.50Dec. 22.25 22.05 19.37 ... 21.64 20.89 24.20 23.95Nov. ... ... 21.26 ... 21.04 20.39 23.10 22.85Oct. ... ... 20.45 ... 21.43 20.83 23.80 23.55

Abu Dhabi r Dubai s Qatar f Oman r Yemen f

Upper Marine Dukhan MaribZakum Zakum Fateh (Far East) (Far East) Oman (Average)* Masila

March 20.10 18.25 18.10 19.36 19.50 19.10 18.72 18.05Feb. 20.90 18.90 18.75 20.25 20.33 19.72 20.60 19.93Jan. 23.80 21.65 21.45 23.09 23.16 22.50 23.18 23.50Dec. 24.25 22.10 21.65 23.43 23.50 22.82 23.68 23.33Nov. 23.15 21.20 20.95 22.42 22.49 21.80 22.99 22.64Oct. 23.85 21.95 21.75 21.73 21.81 22.50 23.94 23.59





WEST AFRICANigeria Angola s Gabon s

Bonny Bonny Brass QuaLight Forcados Medium River Escravos Iboe Cabinda Mandji


MEDITERRANEANAlgeria s Libya f Egypt p

SuezSaharan Es Sider Sarir Amna Brega Siritca Zueitina Blend


MEDITERRANEAN NORTH EUROPEEgypt p Syria USSR s UK s

Belayim Gharib Ras Urals BrentBlend Blend Budran Souedieh Light f (c.i.f.) Blend Forties


NORTH EUROPE FAR EASTNorway s USSR s Indonesia p

UralsEkofisk Statfjord (c.i.f.) Minas Duri Cinta Handil Widuri


FAR EASTIndonesia p China r Malaysia r Brunei r

Arun Tapis MiriArdjuna Attaka Cond. Daqing Blend Labuan Light Seria

March 19.91 20.77 ... 18.88 23.39 22.54 22.49 22.95Feb. 21.50 22.25 21.25 21.01 23.79 23.94 23.89 25.35Jan. 24.10 24.91 23.83 23.75 26.23 26.38 26.33 26.75Dec. 23.13 23.94 23.02 22.13 25.11 25.21 25.01 25.25Nov. 22.73 23.58 22.64 22.05 25.06 25.16 24.96 26.20Oct. 23.38 24.22 23.22 22.61 25.70 25.80 25.60 24.80





FAR EAST NORTH AMERICABrunei r Papua US p

New Guinea West Texas West Texas ANS ANS Louisiana LightChampion Kutubu Int. Sour (Gulf) (Calif.) Sweet Wilmington

March 22.75 19.46 19.76 17.50 ... 21.07 19.66 15.45Feb. 25.15 21.01 21.08 18.92 ... 23.63 21.36 17.09Jan. 26.55 23.10 24.02 22.02 ... 23.50 24.19 19.80Dec. 25.05 22.55 23.84 21.84 ... 21.36 24.46 21.10Nov. 26.00 22.19 22.38 20.38 ... 22.61 23.18 20.00Oct. 24.60 24.10 23.71 21.71 ... 21.70 24.44 21.60

NORTH AMERICACanada p Mexico (Formula, Retrospective) c

Alberta Isthmus Isthmus Isthmus Isthmus Maya MayaLloydminster Light (W. Hemis.) (Europe) (Far East) (Average)* (W. Hemis.) (Europe)


NORTH AMERICA SOUTH AMERICAMexico (Formula, Retrospective) c Venezuela p

Maya Maya Furrial(Far East) (Average)* Olmeca Bachaquero (US) BCF-17 BCF-21.9

March 15.22 14.67 19.83 ... 17.96 15.85 16.71Feb. 15.95 15.75 21.64 ... 18.81 17.35 18.28Jan. 18.40 18.50 24.55 ... 23.65 19.31 20.24Dec. 18.95 19.29 25.04 ... 23.36 21.15 22.08Nov. 18.42 18.87 23.54 ... 21.82 21.15 22.08Oct. 19.25 20.64 24.77 ... 22.98 20.87 21.80

SOUTH AMERICAColombia f Ecuador f

Cano Limon Cusiana Oriente(US) (US) (US)

March 19.27 20.47 17.59Feb. 21.02 21.72 19.80Jan. 24.40 26.25 22.52Dec. 24.12 25.45 22.26Nov. 22.42 24.12 20.54Oct. 23.33 24.83 21.61



TO EUROPE Current Price TimingPoint Market From Loading Adjustment Factors

Country/Crude Of Sale Link a (In Days) b April March Feb.Saudi Arabia Ex. Lt.-37 f.o.b. Brent 40 -1.15 -0.95 -0.90

Light-33 f.o.b. Brent 40 -1.95 -1.85 -1.85Medium-31 f.o.b. Brent 40 -3.15 -3.15 -3.15Heavy-27 f.o.b. Brent 40 -3.80 -3.80 -3.80Extra Light-37 Sidi Kerir Brent 0 -0.45 -0.25 -0.20Light-34 Sidi Kerir Brent 0 -1.25 -1.15 -1.15Medium-31 Sidi Kerir Brent 0 -2.45 -2.45 -2.45Heavy-27 Sidi Kerir Brent 0 -3.10 -3.10 -3.10

Kuwait-31 f.o.b. Brent 40 -3.15 -3.15 -3.15Iran Light-33 Rotterdam Brent Delivery c -1.45 -1.30 -1.00

Heavy-30 Rotterdam Brent Delivery c -2.00 -1.85 -1.45Light-34 f.o.b. Brent 0 -1.95 -1.80 -1.50Heavy-31 f.o.b. Brent 0 -2.45 -2.30 -2.00

Iraq Kirkuk-37 Ceyhan Brent 5 -1.90 -1.72 -1.55Yemen Marib-48 f.o.b. Brent 0 -0.15 -0.30 -0.30

Masila-30.5 f.o.b. Brent 0 -0.50 -0.97 -0.97Nigeria Bonny Lt.-36 f.o.b. Brent 5 +0.04 +0.58 +0.53

Bonny Medium-26 f.o.b. Brent 5 -0.50 +0.35 +0.53Forcados-29 f.o.b. Brent 5 -0.40 +0.47 +0.68Qua Iboe-36 f.o.b. Brent 5 +0.04 +0.58 +0.53Brass River-42 f.o.b. Brent 5 +0.09 +0.59 +0.45Escravos-36 f.o.b. Brent 5 -0.04 +0.52 +0.44

Libya Es Sider-37 f.o.b. Brent 0 -0.40 -0.05 +0.05Sarir-37 f.o.b. Brent 0 -0.75 -0.55 -0.55Amna-36 f.o.b. Brent 0 -0.80 -0.60 -0.60Brega-40 f.o.b. Brent 0 +0.15 +0.40 +0.40Sirtica-42 f.o.b. Brent 0 -0.25 +0.05 +0.15Zueitina-42 f.o.b. Brent 0 +0.15 +0.40 +0.40

Syria Light-37 f.o.b. Brent 5 -0.95 -0.50 0.27Souedieh-24 f.o.b. Brent 5 -4.70 -4.80 -4.75

Egypt Suez Bl.-32 f.o.b. Brent 0 -2.75 -2.50 -2.35Belayim Bl.-26 f.o.b. Brent 0 -3.70 -3.60 -3.60Gharib Bl.-24 f.o.b. Brent 0 -4.40 -4.35 -4.35Ras Budran-24 f.o.b. Brent 0 -3.85 -3.80 -3.80

Mexico Isthmus-33 f.o.b. ((DBx0.887+ 0 -0.36 -0.26 -0.16(3.5%FOx0.113)-

(0.16x(1%FO-3.5%FO))Maya-22 f.o.b. ((DBx0.527)+ 0 -2.00 -1.85 -1.85

(3.5%FOx0.467)-(0.25x(1%FO-3.5%FO)))


HHooww TTeerrmm--CCoonnttrraacctt PPrriicceess AArree CCaallccuullaatteeddTerm-contract formulas generally have four basic components: the point of sale, a

market-related benchmark, an adjustment factor for differences related to crude oil

quality and point of sale, and a timing mechanism stipulating when the value of the

formula is to be calculated. The adjustment factor in the formula is applied to a spot-mar-ket or other benchmark, say dated Brent, at a designated time relative to the loading of thecargo. In many formulas, the �snapshot� of the benchmark grade�s value is taken on oraround the day of loading. In other cases, the trigger point is set to reflect the transit timeto the end-user�s market.

A PROFILE OF THE LATEST CRUDE OIL PRICE FORMULAS


TO FAR EAST Current Price TimingPoint Market From Loading Adjustment Factors

Country/Crude Of Sale Link a (In Days) b April March Feb.Saudi Arabia Sup. Lt.-50 f.o.b. (O+D)/2 0 +2.95 +3.45 +3.25

Extra Light-37 f.o.b. (O+D)/2 0 +1.70 +1.95 +2.15Light-33 f.o.b. (O+D)/2 0 +0.60 +0.60 +0.75Medium-31 f.o.b. (O+D)/2 0 -0.40 -0.40 -0.30Heavy-27 f.o.b. (O+D)/2 0 -1.25 -1.25 -1.15

Iran Light-33 f.o.b. O+((77¢-(O-D))/2) 0 -0.07 -0.07 +0.08Heavy-30 f.o.b. D-((77¢-(O-D))/2) 0 -0.13 -0.13 -0.03

Kuwait-31 f.o.b. (O+D)/2 0 -0.50 -0.50 -0.40Neut. Zone Khafji-28 f.o.b. (O+D)/2 0 -1.25 -1.25 -1.15Qatar Dukhan-41 f.o.b. Oman MPM 0 ... +0.40 +0.61

Marine-36 f.o.b. Oman MPM 0 ... +0.26 +0.53Iraq Basrah-34 Red Sea (O+D)/2 0 +0.05 +0.05 +0.20Yemen Marib-48 f.o.b. Brent 0 -0.15 -0.30 -0.30

Masila-30.5 f.o.b. Brent 0 -0.50 -0.97 -0.97Mexico Isthmus-33 f.o.b. (O+D)/2 0 +0.60 +0.60 +0.75

Maya-22 f.o.b. (O+D)/2 0 -3.20 -3.30 -3.20

TO UNITED STATES Current Price TimingPoint Market From Loading Adjustment Factors

Country/Crude Of Sale Link a (In Days) b April March Feb.Saudi Arabia Ex. Lt.-37 f.o.b. WTI 50 -2.35 -2.15 -2.05

Light-33 f.o.b. WTI 50 -3.45 -3.30 -3.05Medium-31 f.o.b. WTI 50 -4.50 -4.35 -3.95Heavy-27 f.o.b. WTI 50 -5.35 -5.20 -4.65Extra Light-37 US Gulf WTI Delivery c -1.15 -0.95 -0.85Light-33 US Gulf WTI Delivery c -2.25 -1.95 -1.85Medium-31 US Gulf WTI Delivery c -3.30 -3.00 -2.75Heavy-27 US Gulf WTI Delivery c -4.15 -4.00 -3.45Kuwait-31 US Gulf WTI Delivery c -3.30 -3.00 -2.75

Iraq Basrah-34 f.o.b. WTI d 15 -4.45 -4.30 -4.30Iraq Kirkuk-37 f.o.b. WTI d 10 -3.50 -3.15 -3.10Nigeria Bonny Lt.-36 f.o.b. Brent 5 +0.04 +0.58 +0.53

Bonny Medium-26 f.o.b. Brent 5 -0.50 +0.35 +0.53Forcados-29 f.o.b. Brent 5 -0.40 +0.47 +0.68Qua Iboe-36 f.o.b. Brent 5 +0.04 +0.58 +0.53Brass River-42 f.o.b. Brent 5 +0.09 +0.59 +0.45Escravos-36 f.o.b. Brent 5 -0.04 +0.52 +0.44

Mexico Isthmus-33 f.o.b. (0.4x(WTS+LLS))+ 0 -1.35 -1.15 -1.00(0.2xDB)

Maya-22 f.o.b. (0.4x(WTS+3%FO)) + 0 -1.75 -1.75 -1.75(0.1x(LLS+DB))

Olmeca-39 f.o.b. (WTS+LLS+DB)/3 0 +0.15 +0.40 +0.55Colom. Cano Limon-30 f.o.b. WTI 0 -3.00 -1.70 -1.20

Cusiana-36 f.o.b. WTI 0 -0.60 0.00 -0.50Ecuador Oriente-29 f.o.b. WTI 0 -3.41 -3.41 -3.41Venezuela Furrial-30 f.o.b. WTI 0 -3.38 -3.00 -2.40

a Abbreviations used in defining market linkage: Brent and DB: Dated Brent; FO: Residual fuel oil in market of crude oil sale withpercentage referring to sulfur content; O: Oman spot price; D: Dubai spot price; Oman MPM: Oman official posting; WTI: WestTexas Intermediate spot price at Cushing; WTS: West Texas Sour spot price; LLS: Light Louisiana Sweet spot price. b The mar-ket linkage is calculated at the time indicated below based on an average over a period of days. For Europe, averages are usu-ally a 5-day period, except for Saudi f.o.b. sales which are 10 days. For Far East sales, all averages are for the calendar monthof loading. For US sales, the averages are usually for 5 days. c Delivery: Price triggered on day that the crude oil is unloadedin the buyers regional market. d Iraq uses second-month WTI.


A PROFILE OF THE LATEST CRUDE OIL PRICE FORMULAS (cont.)

Documents

Crude Oil Handbook