5 Crude Oil Facts You Need to Know
If you are interested in learning about one of the most widely used commodities called crude oil, you are on the right page. There is much to know about this product, such as its global usage, business decisions, and origins. Let’s take a look at some of the important facts.
1) It is a natural resource
Basically, crude oil is a natural product, consisting of some sulfur, oxygen, nitrogen, and more hydrocarbons. It forms from what remains of small animals and plants below the earth’s surface after millions of years. Many natural factors such as pressure and heat convert the remains into oil.
Depending on the type of oil and the extraction method, it can be classified as heavy, extra-heavy, medium or light.
2) Crude oil is used in production processes
Crude oil is on the list of the most important energy sources on the planet. It is burned to produce heat as a fuel. Apart from this, it is used in asphalt, lubricants, waxes, and many other petrochemicals. Later, these products are used and converted into other products such as clothing and plastics.
It is amazing to know that everything we see around us depends on crude oil during the production process.
3) 5 countries produce 50% of the oil used worldwide
In 2017, Saudi Arabia, the US, Iran, Russia and Canada produced around 46 million of 92 million barrels of oil. The rest of the oil is produced by other countries in the world.
The price of this product is affected by many factors, such as political uncertainty and weather. For example, in harsh climates, it is not possible to extract oil from the ground, which can result in product shortages. As a result, prices go up. Therefore, experts take these factors into account to ensure that there is no shortage of oil.
4) Daily Consumption
The width, length and depth of an Olympic swimming pool is 25 meters, 50 meters and 2 meters respectively. To fill one such pool, it can take up to 1,577 barrels of crude oil. You will be amazed to know that this is the amount of oil consumed in the world in two minutes.
Now, if traders hear that oil usage is increasing, it gives them an indication that demand for the commodity is going to increase. So, crude oil is considered an indicator of the economic health of the world. In a strong economy, the use of oil continues to increase.
5) Daily consumption in the US
In the USA, the daily import of oil is 8 million barrels. While the US is at the top of the list when it comes to oil production, it still imports around 8 million barrels per day. There are two reasons behind this. First, oil consumption in the US is relatively higher than in other countries. Second, not all the oil the country produces is up to scratch.
So, here are 5 facts about crude oil that you might be interested in.
