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Oil provides about 40 percent of the energy Americans
consume and roughly 97 percent of our transportation fuels.
Oil is at the crux of the modern economic system, and its importance
should not be discounted.
Not
only is Oil, in one form or another, used to heat our homes and fuel our
vehicles, petroleum-based products can be found in a variety of everyday
household items, including deodorant, toothpaste, paints, balloons, perfumes and
cosmetics.
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Top 5
Producers |
|
Rank |
Country |
% of Total |
|
1) |
OPEC |
36.0% |
|
2) |
Russia |
14.0% |
|
3) |
USA |
10.0% |
|
4) |
North Sea |
6.0% |
|
5) |
Mexico |
5.0% |
|
World Production |
84.4 |
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data in million
barrels per day |
Crude Oil is the raw material for all petroleum products,
ranging from gasoline to lubricants. A
typical 42 gallon barrel of Crude Oil is broken down into the following
components: 19.5 gallons is used to produce gasoline, 9.2 gallons are used to
produce distillate fuels (such as Heating Oil), 4.1 gallons goes for the
production of kerosene jet fuel, and 2.3 gallons is used in the production of
residual fuels. The remainder is
primarily for chemical production and lubricants.
What a Barrel of Crude Oil Makes
|
Product
|
Gallons
per Barrel
|
|
Gasoline
|
19.5
|
|
Distillate Fuel Oil
(includes both home heating oil & diesel)
|
9.2
|
|
Kerosene-type Jet Fuel
|
4.1
|
|
Residual Fuel Oil
(heavy
oils used as fuels in industry, marine transport and electric power
generation)
|
2.3
|
|
Liquefied Refinery Gases
|
1.9
|
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Still Gas
|
1.9
|
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Coke
|
1.8
|
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Asphalt and Road Oil
|
1.3
|
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Petrochemical Feedstock
|
1.2
|
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Lubricants
|
0.5
|
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Kerosene
|
0.2
|
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Other
|
0.3
|
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Figures
are based on 1995 average yields for US refineries. One barrel of oil contains 42 gallons.
Excess due to "processing gain"
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Because the demand for Crude Oil is directly tied to the
demand for its products, Crude Oil has two demand peaks each year, coinciding
with the demand peaks of its two main products: Unleaded Gasoline and Heating
Oil.
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Top 5 Consumers |
|
Rank |
Country |
% of Total |
|
1) |
United States |
25.0% |
|
2) |
Japan |
8.3% |
|
3) |
Former USSR |
6.7% |
|
4) |
China |
4.9% |
|
5) |
Germany |
4.2% |
|
World Usage |
82.8 |
|
in million
barrels per day |
One of the major influences on the supply of Crude Oil is the Organization
of Petroleum Exporting Countries, or OPEC.
|
5 Year World
Production
 |
|
2002 |
77.717 |
|
2003 |
76.957 |
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2004 |
79.565 |
|
2005 |
83.005 |
|
2006 |
84.411 |
Because Oil production is in politically
unstable regions of the world - the Middle East, Russia, etc. prices
normally reflect a "risk premium" above the nominal price one would assume
based strictly on supply and demand.
|
5 Year World Usage
 |
|
2002 |
82.832 |
|
2003 |
83.987 |
|
2004 |
84.453 |
|
2005 |
79.752 |
|
2006 |
78.082 |
Trader's should note that the strongest
times of the year usually coincide with the dual demand nature for Crude Oil
dictated by it's products - Unleaded Gasoline and Heating Oil.
7 and 19 year Average
Seasonal Price
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