Eagle Ford and other shale plays are helping the United States get closer to energy independence. Hooray for that.
Now the problem is that many refineries along the US Gulf Coast can only refine a limited amount of the light, sweet crude coming from Eagle Ford and other shale plays around the country.
Forecasters predict that this imbalance is going to cause a bottleneck in the near future – especially now that the Gulf starting to produce again.
Light crude usually gets a premium price over heavy crude – being easier (less energy) to refine and containing less sulfur.
The oversupply situation is going to drive the price of sweet light crude down, according got forecasters.
Another factor contributing to the downward pricing pressure is that refineries would have to revamp and replace equipment to convert to more light crude oil production.
Heavy crudes also have a more severe environmental impact than light ones (we wonder if the anti-frackers consider that?)
Maybe some of Obama’s 90 Billion in green energy spending would better serve as subsidies to refineries to re-tool and process the “greener” light crude. Create jobs, support domestic oil, and help the environment. Win – Win – Win.