The Basics of Crude Oil Classification
Liquid petroleum pumped from oil wells is called “crude” or "crude oil." Composed predominantly of carbon, crude oil contains approximately 84 to 87 percent carbon and 11 to 13 percent hydrogen. Crude oil also contains varying amounts of oxygen, sulfur, nitrogen, and helium.
Crude Oil Classifications
The petroleum industry often names crude based on the oil's geographical source — for example “West Texas Intermediate.” Crude oil is also classified based on physical characteristics and chemical composition, using terms such as “sweet” or “sour,” “light” or “heavy.” Crude oil varies in price, usefulness, and environmental impact.
What Is “Sweet” Crude Oil?
Crude oil with low sulfur content is classified as “sweet;” crude oil with a higher sulfur content is classified as “sour.” Sulfur content is considered an undesirable characteristic with respect to both processing and end-product quality. Therefore, sweet crude is typically more desirable and valuable than sour crude.
What Makes a Crude Oil “Light?”
Crude can be classified as “light” or “heavy,” a characteristic which refers to the oil’s relative density based on the American Petroleum Institute (API) Gravity. This measurement reflects how light or heavy a crude oil is compared to water. If an oil’s API Gravity is greater than 10, it is lighter than water and will float on it. If an oil’s API Gravity is less than 10, it is heavier than water and will sink.
Lighter crude is easier and less expensive to produce. It has a higher percentage of light hydrocarbons that can be recovered with simple distillation at a refinery.
Heavy crude can’t be produced, transported, and refined by conventional methods because it has high concentrations of sulfur and several metals, particularly nickel and vanadium. Heavy crude has density approaching or even exceeding that of water. Heavy crude oil is also known as “tar sands” because of its high bitumen content.
With simple distillation, dense, heavier crude oil produces a greater share of lower-valued products. Heavy crude requires extra refining to produce more valuable and in-demand products.
What Determines Crude Oil’s Relative Economic Value?
Generally, the less processing or refining a crude oil undergoes, the more valuable it is considered. Price differentials between crude oils typically reflect the ease of refining.
Crude oil can be refined to create products ranging from asphalt and gasoline to lighter fluids and natural gas, along with a variety of essential elements such as sulfur and nitrogen. Petroleum products are also key components in the manufacturing of medicines, chemicals, and plastics.
How Distillation Impacts Price
Simple distillation — first-level refinement — of different crude oils produces different results. For example, the U.S. benchmark crude oil, West Texas Intermediate (WTI), has a relatively high natural yield of desirable end-products, including gasoline. But the process also yields about one third “residuum,” a residual by-product that must be reprocessed or sold at a discount. In contrast, simple distillation of Saudi Arabia's Arabian Light, the historical benchmark crude, yields almost half "residuum." This difference gives WTI a higher premium.
The lighter the oil, the more of the desirable, in-demand products it produces through distillation at a range of temperatures. At the lowest distillation temperatures, products produced include liquid petroleum gases (LPG), naphtha and so-called "straight run" gasoline. In the middle range of distillation temperatures, the refinery produces jet fuel, home heating oil, and diesel fuel.
At the highest distillation temperatures — over 1,000 degrees Fahrenheit – the heaviest products are produced, including residuum or residual fuel oil, which can be used for lubricants. To maximize the output of more desirable products, refineries commonly reprocess the heaviest products into lighter products.
Are Some Crude Oils More Toxic Than Others?
“Toxicity” refers to how harmful an oil might be to humans and other living organisms, as well as to land and water. Generally, the lighter the oil, the more toxic it is considered. Because of the constant potential of spills, the Environmental Protection Agency has classified crude oil in four categories that reflect how the oil would behave in spills and its aftermath:
- Class A: Because they are light and highly liquid, these clear and volatile oils can spread quickly on impervious surfaces and on water. Their odor is strong, and they evaporate quickly, emitting volatiles. Usually flammable, these oils also penetrate porous surfaces, such as dirt and sand, and may remain in areas into which they seep. Humans, fish, and other plant and animal life face the danger of toxicity to Class A oils.
- Class B: Considered less toxic than Class A, these oils are generally non-sticky but feel waxy or oily. The warmer they get, the more likely Class B oils soak into surfaces; they can be hard to remove. When volatile components of Class B oils evaporate, the result can be a Class C or D residue. Class B includes medium to heavy oils.
- Class C: These heavy, tarry oils, which include residual fuel oils and medium to heavy crudes, are slow to seep into porous solids and are not highly toxic. However, Class C oils are difficult to flush away and can sink in water and can smother or drown wildlife.
- Class D: Non-fluid, thick oils are comparatively non-toxic and don’t seep into porous surfaces. Mostly black or dark brown, Class D oils tend to dissolve and cover surfaces when they get hot, which makes them hard to clean up. Heavy crude oils, such as the bitumen found in tar sands, fall into this class.