U.S. produces lighter oil, tight formation production rises

by Talk Business & Politics staff (staff2@talkbusiness.net) 43 views 

The average density of crude oil produced in the United States has become lighter as domestic production continues to rise, according to the U.S. Energy Information Administration. Average API gravity, which is a measure of crude oil density and higher numbers mean a lower density, has risen in 2017 and through the first half of 2018.

Crude oil production with an API gravity of more than 40 degrees increased by 310,000 barrels per day to more than 4.6 million barrels per day in 2017. The increase represented 53% of total crude oil production in the lower 48 states in 2017, up from 50% in 2015.

API gravity is the inverse of the density of a petroleum liquid relative to water. The higher the API gravity, the lower the density of the petroleum liquid, and lighter oils have higher API gravities. The rise in light crude oil production is a result of increased production from tight formations, and this has been enabled because of improvements in horizontal drilling and hydraulic fracturing.

API gravity determines the type of processing needed to refine crude oil into fuel and other petroleum products. U.S. refineries can process a variety of crude oil types, and processing only light crude oil can be uneconomical at some refineries. The same is true for processing only heavy crude oil as it can lead to large amounts of low-value heavy products such as residual fuel.

The API gravity of crude oil can vary based on where it’s produced, and oil produced in Texas, the largest crude oil-producing state, has a API gravity ranging between 30 and 50 degrees. Crude oil with an API gravity of 40 to 50 degrees accounted for 55% of the amount of oil produced in the state. Production of crude oil in this API gravity range was the fastest growing, reaching 1.9 billion barrels per day. In North Dakota, about 90% of crude oil production had an API gravity of 40 to 50 degrees.

Crude oil produced in the Federal Gulf of Mexico is denser, with more than 34% of production with an API gravity of lower than 30 degrees and 65% with an API gravity of 30 to 40 degrees. Imported crude oil also is heavier, and in 2017, 96%, or 7.6 million barrels per day, had an API gravity of 40 or below, compared to 48%, or 4.2 million barrels per day, of domestic production.