This may explain Trump's bizarre behavior around Canada ("51st state") and Venezuela.
The USA needs oil from Canada and Venezuela.
America refineries, especially in Texas, are set up for heavy sour.
- unprocessed it's cheaper because requiring more expensive processing
- Heavy: Higher density, "goopy".
- Sour: High sulfur content.
- common in Canada (oil sands) and Venezuela.
The U.S. makes the high-quality stuff, called sweet light oil, which ironically is easier to process, but it's also expensive.
But the US has set up very expensive refineries, with specialty equipment to handle heavy sour.
Canadian Oil Important for US Midwest gasoline prices: Kansas Fed
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This regional variation in input sourcing reflects that refineries have become more specialized over time to receive and process certain types of oil.
Most of the crude oil extracted in the United States is high quality, referred to as light sweet crude, while the oil imported from Canada is a heavy sour crude that requires additional processing to remove sulfur and break down its heavy molecules into lighter, more valuable products (EIA 2022).
The refining equipment for heavy sour crude is significantly more complex and extensive than for light sweet crude. As a result, a refinery with equipment to process heavy sour crude cannot easily switch to refining a different type of oil.
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The real reason Venezuela matters
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