Shale Gluts and Ship Rules Make Heavy Sweet Oil an Unlikely Star

Shale boom, shipping rules weaken light and high-sulfur grades
Crudes from Angola, Brazil may benefit from quality concerns

A fresh weld fills the joint between two sections of pipe during construction of the Gulf Coast Project pipeline in Atoka, Oklahoma, U.S., on Monday, March 11, 2013. The Gulf Coast Project, a 485-mile crude oil pipeline being constructed by TransCanada Corp., is part of the Keystone XL Pipeline Project and will run from Cushing, Oklahoma to Nederland, Texas.Photographer: Daniel Acker

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By Serene Cheong and Dan Murtaugh

November 30, 2018 at 9:37 AM UTC

This article is for subscribers only.

There’s a rising star in the oil world, and it’s heavy and sweet.

Dense, low-sulfur oil, known in industry parlance as heavy sweet crude, is fetching increasingly stronger prices relative to benchmark lighter grades. For example, Angola’s Dalia traded at just 10 cents below Brent oil last month, up from a discount of $4.50 in January 2016, according to S&P Global Platts. Australian Pyrenees traded at $4 more than Brent, its widest premium in more than three years, according to trading sources.