• 2 minutes California to ban gasoline for lawn mowers, chain saws, leaf blowers, off road equipment, etc.
  • 6 minutes China and India are both needing more coal and prices are now extremely high. They need maximum fossil fuel.
  • 11 minutes Europeans and Americans are beginning to see the results of depending on renewables.
  • 6 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 15 hours The Climate Scare Stories Began With Far Left Ideology Per GreenPeace Co-Founder
  • 51 mins Monday 9/13 - "High Natural Gas Prices Today Will Send U.S. Production Soaring Next Year" by Irina Slav
  • 16 hours Putin and Xi have decided not to attend the Climate Summit in Glasgow
  • 3 days "A Very Predictable Global Energy Crisis" by Irina Slav --- MUST READ
  • 22 hours Biden Sets Target Of 50% EV Share In U.S. Car Sales In 2030
  • 1 hour US intel warns China could dominate advanced technologies By NOMAAN MERCHANT October 22, 2021
  • 19 hours "The Hidden Story About California's Container Ship Backlog" via Corbett Report
  • 12 hours Storage of gas cylinders
  • 3 days Two Good and Plausible Ideas about Saving Water and Redirecting it to Where it is Needed.
Oil And Gas Stocks Are Popular Once Again

Oil And Gas Stocks Are Popular Once Again

Energy stocks, particularly oil and…

Indonesia Refineries Prepare To Switch To Sour Crudes

The latest oil price rally that made Brent less appealing to international buyers has prompted Indonesian refineries to start preparing for modifications that will allow them to process more sour crude grades and reduce their input of costlier sweet crude, Platts reports.

Most refineries in the country, which consumes more than 1.6 million barrels of crude daily, are equipped to process light sweet crudes, but now that there is price pressure, the facilities will need to make some changes to allow them to take full advantage of the spread between Brent-linked sweet crudes and cheaper grades.

State-owned energy major Pertamina said the modifications will begin next year, first at three refineries, which have a combined capacity of 733,000 bpd. The company’s refining director Toharso said that "We want to upgrade all our refineries gradually to be able to process sour crude. We will not add new units in the refineries but only upgrade the existing ones."

The sweet crudes that are linked to the Brent benchmark include oil from Africa, the Mediterranean, the North Sea, the Black Sea, and Oceania. Crude grades produced in the Middle East and Russia’s Far East, on the other hand, are linked to the Dubai benchmark and tend to be more affordable.

Related: Is Premium Gasoline A Waste Of Money?

At the time of writing, while Brent was trading at US$63.45 a barrel, the OPEC basket comprising both Middle Eastern and Brent-linked crudes, was changing hands at almost US$2 less a barrel, at US$61.64.

Then there is the price difference between sweet and sour grades: the former are easier to process and hence more expensive, while sour crude has always been sold at a discount, sometimes a substantial one at that. Now that Brent, thanks to the OPEC cuts and the Forties outage, is trading considerably higher, it makes sense for a nation that imports 40 percent of the oil it needs to switch to cheaper grades, even this means additional costs for refinery upgrades.

Earlier this week, Pertamina’s procurement chief said that he expected the company to import some 250,000 bpd of crude next year. That’s half of the portion of domestic oil output that goes into local refineries. In total, Indonesia produces around 800,000 bpd.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News