Crude Oil Primer

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Table of Contents

Crude oil......................................................................................................................................1 Ancient Civilisation ...................................................................................................................1 Politics of Black Gold.................................................................................................................1 Physical attributes of crude ......................................................................................................3 Derivatives of crude (Refinery products- Distillation process)...........................................4 Petrochemical chain & Industrial applications......................................................................5 Brief write up on individual commodities .............................................................................5 Demand & Supply Data ............................................................................................................7 Crude oil Demand......................................................................................................................8 Contract Details........................................................................................................................13 Conversion Tables....................................................................................................................14 Glossary .....................................................................................................................................16

Composition
Crude oil is a mixture of thousands of different hydrocarbons (compounds of hydrogen and carbon), as well as such undesirable impurities such as sulfur, nitrogen, and metals. Individual
hydrocarbons have different boiling point range. A sample of crude oil will therefore have a range of boiling points & the mixture can be separated by fractional distillation. Unrefined petroleum is also called Crude Oil.

History of Drilling Oil

Reference to Oil discoveries have
been found in the Babylon &
Ardericca, Sumatarans, Anciet
Persian Civilizations

Crude oil has long history dated back more than four thousands years. According to Herodotus and confirmed by Diodorus
Siculus, oil pits were found in Ardericca near Babyoln. There are references which states first oil wells were drilled in China in 4th century or earlier. Ancient Persians, 10th century Sumatrans and pre-Columbian Indians all believed that crude oil had medicinal benefits. Marco Polo founded that crude oil is used in the Caspian Sea region to treat camels for mange. The first oil exported from Venezuela (in 1539) was intended as a gout treatment for the Holy Roman Emperor Charles V. James. Miler Williams drilled first well in Oil Spring, Ontario, Canada in 1858.

Politics of Black Gold

Nations have been built and
destroyed, with hopes of reigning
supremacy on all humanity, by
possessing the black Gold

Crude oil history is rich with political interventions and the swings in the prices have huge repercussions on the global economy. Crude oil prices were less than $ 3 per barrel till 1960s. In 1960s to firm up oil prices Organization of the Petroleum Exporting

Countries (OPEC) was formed with five founding members Iran, Iraq, Kuwait, Saudi Arabia and Venezula. By the end of 1971 six more members joined OPEC which includes Qatar, Indonesia,
Libya, and United Arab Emirates (UAE). After 1971 OPEC
purchasing power of the crude was falling. In quest of more oil Texas Railroad Commission declared 100% proration in March
1971 which resulted in the shifting the power to control crude oil supply hence prices from United States to OPEC.
From 1974 to 1978 oil prices remained fairly flat between $ 12 per barrel to $14 per barrel. 1979-80 was the period of the Iranian revolution. During this period crude oil production reduced 2-2.5 million barrels per day with short...
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