CRUDE OIL FUNDAMENTALS

Oil Prices: Why they are falling and its impact on World Economy and India

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What is Crude Oil?Crude oil is a naturally-occurring substance found in certain rock formations in the earth.It is a dark, sticky liquid classified as a hydrocarbon. This means, it is a compound containing mainly carbon and hydrogen.Crude oil is highly flammable and can be burned to create energy. Crude oil is the most important source of energy, since all kinds of transportation depend intensely on oil, the long run option for crude oil is of critical interest.Crude oil is the worlds most actively traded commodity.Light, sweet crudes are preferred by refiners because of their low sulfur content and relativelyhigh yieldsof high-value products such as gasoline, diesel fuel, heating oil, and jet fuel.Petroleum= Petra (Rock) + Oleum (Oil) (Latin)

Image Courtesy - http://www.news.az/photos/page-photo/133429.jpg/ Hasnain Baber 2015

Components of OilThe exact molecular composition varies widely from formation to formation but the proportion of chemical elements vary over fairly narrow limits as follows:Carbon -- 83-87%Hydrogen --10-14%Nitrogen--0.1-2%Oxygen--0.1-1.5%Sulfur--0.5-6%Metals--