| Key Terms |
Definition |
| API Gravity |
An arbitrary scale expressing the gravity or density of liquid petroleum products.
The measuring scale is calibrated in terms of degrees API; it is calculated as follows:
Degrees API = (141.5 / (sp. gr. 60ºF / 60ºF)) - 131.5
The higher the API gravity, the lighter the compound. Light crudes generally exceed 38 degrees API
and heavy crudes are commonly labeled as all crudes with an API gravity of 22 degrees or below.
Intermediate crudes fall in the range of 22 degrees to 38 degrees API gravity.
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| Barrel |
A unit of volume equal to 42 U.S. gallons.
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| Crude Oil |
A mixture of hydrocarbons that exists in liquid phase in natural underground
reservoirs and remains liquid at atmospheric pressure after passing through
surface separating facilities. Depending upon the characteristics of the crude
stream, it may also include:
Small amounts of hydrocarbons that exist in gaseous phase in natural
underground reservoirs but are liquid at atmospheric pressure after being
recovered from oil well (casinghead) gas in lease separators and are subsequently
commingled with the crude stream without being separately measured. Lease
condensate recovered as a liquid from natural gas wells in lease or field
separation facilities and later mixed into the crude stream is also included;
Small amounts of nonhydrocarbons produced with the oil, such as sulfur and
various metals;
Drip gases, and liquid hydrocarbons produced from tar sands, oil sands,
gilsonite, and oil shale.
Liquids produced at natural gas processing plants are excluded. Crude oil is refined to produce
a wide array of petroleum products, including heating oils; gasoline, diesel and jet fuels;
lubricants; asphalt; ethane, propane, and butane; and many other products used for their
energy or chemical content.
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| F.O.B. (Free on Board) |
Pertains to a transaction whereby the seller makes the product available within an agreed
on period at a given port at a given price; it is the responsibility of the buyer to arrange
for the transportation and insurance.
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| OPEC (Organization of the Petroleum Exporting Countries) |
The Organization of the Petroleum Exporting Countries (OPEC) was founded in Baghdad, Iraq, with the signing of an agreement in September 1960 by five countries namely Islamic Republic of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. They were to become the Founder Members of the Organization. These countries were later joined by Qatar (1961), Indonesia (1962), Libya (1962), the United Arab Emirates (1967), Algeria (1969), Nigeria (1971), Ecuador (1973), Gabon (1975), Angola (2007), Equatorial Guinea (2017) and Congo (2018). Ecuador suspended its membership in December 1992, rejoined OPEC in October 2007, but decided to withdraw its membership of OPEC effective 1 January 2020. Indonesia suspended its membership in January 2009, reactivated it again in January 2016, but decided to suspend its membership once more at the 171st Meeting of the OPEC Conference on 30 November 2016. Gabon terminated its membership in January 1995. However, it rejoined the Organization in July 2016. Qatar terminated its membership on 1 January 2019.
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Definitions