General Question About Oil Prices

I Have been told many times that North Dakota sweet is so pure it "almost" doesn't even need refining.

Yet when I check crude prices it always seems ND crude sells for less than any other.

My guess is that the transportation costs cause it to be bid down, but that's is only my guess.

Can anyone explain??

I use this site for pricing info.

http://crudeoilpostings.semgroupcorp.com/

Dear Patrick J.

No, it is not transportation that is affecting the price of ND Crude. Remember that oil is a mineral like other hard minerals and has different grades of classes.

Take what you have been told about ND crude (and I don’t know, because I did not look at the gravity) about being “pure” which to me indicates that natural refining took place underground. The other constituent components of crude have been lost - such as the heavies – things that can be turned into motor oil, lubricants, waxes, asphalts, etc.

What may be produced in ND is easy to put into gasoline, there is more to a bbl of crude than just gasoline.

Additionally, the amount of impurities in the mineral greatly affect the price…things like hydrogen sulfide (sulfur).

Thanks for the education Buddy. I guess I always just associated the terms “light and sweet” with higher value than say the oil from the Alberta sands. It will be interesting to see what the crude will be like that is in the newer areas of the Bakken. Thanks again.