Locator: 49863SAMSUNG.
Earnings tomorrow: CAT in the morning; AAPL in the afternoon.
Today:
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The Third Man
As we noted in Take Me Money and Run Venezuela, the country was once a critical supplier of heavy sour crude to Gulf Coast refineries, providing more than 1.3 MMb/d in the late 1990s and early 2000s before Venezuelan production entered a long period of decline soon after Hugo Chavez came into power. Today, the country produces less than 1 MMb/d of crude oil, barely one-quarter of the level it reached in the late 1990s, around 3.5 MMb/d. Venezuelan crude is generally heavy, with API gravities ranging from 8.5 degrees to 25 degrees for varieties like Boscan, Merey, BCF 13 and 17, and Leona, although it also produces some lighter grades, with an API of 30-35 degrees. (API gravity is a measure of how heavy or light a petroleum liquid is compared to water — the lower the API, the denser the crude oil.) Venezuela’s benchmark heavy crude, Merey, comes from the Orinoco Belt (dark-blue-shaded area in Figure 1 below) and has an API of about 16 degrees. Sulfur content for the country’s heavy and light crudes ranges from 1.5% to 2.7%, which categorize them as sour crudes.
