© Reuters / Sioux County Sheriff's Office
Tanker cars from a freight train carrying crude oil after a derailment, Iowa, US
Two South Korean refiners have canceled the delivery of U.S crude oil cargoes that were due to arrive in January and February this year, Bloomberg
reported earlier this week. It cited unnamed sources from the industry as saying the refiners had been concerned about the quality of the crude. Quality could at some point become a bigger problem for U.S. producers.
It's all because of the pipelines, Bloomberg's Serene Cheong, Sharon Cho, and Alfred Cang write in an analysis of the issue. There is a massive pipeline network carrying crude oil from the U.S. shale patch to the Gulf Coast ports where it is loaded on tankers and sent to Asia, with South Korea emerging as the biggest buyer of U.S. crude so far this year.
Yet with so many pipelines - trunks and branches - the oil gets contaminated with various undesirable things, from oil residue to heavy metals, pipe cleaning agents, and a group of compounds called oxygenates. These last ones are particularly worrying for refiners, it seems.
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