Oil major Exxon Mobil XOM told its trading counterparts that it will not buy the Mars crude oil grade until a zinc contamination issue is fixed, two sources familiar with the matter told Reuters.

Zinc contamination in the Mars crude oil stream has pushed down demand and slashed prices for the flagship crude oil produced off the U.S. Gulf coast, sources said earlier this week.

Mars traded at a 10-cent premium on Thursday to crude oil at the Cushing storage hub in Oklahoma, dealers said.

It had eased to a 10-cent discount earlier in the week compared with a $1 premium at the end of June.

Exxon did not respond to requests for comments.

The Mars crude stream is a mix of oil from various platforms off the coast of Louisiana.

Chevron Corp CVX, which operates some of the platforms that produce crude that are a part of the Mars stream, said it was aware of zinc-related issues in Mars crude, and that the company was currently working with the pipeline operator to understand the cause.

Shell, which operates the main Mars platform and the pipeline system that takes the crude to buyers, said on Wednesday that tests determined that the product it contributes to the Mars stream did not have any quality challenges.

Shell’s Mars platform has been producing about 160,000 barrels per day for the last 12 months, according to research firm Energy Aspects.

Zinc does not typically occur naturally in crude oil and running crude with zinc could lead to damage to refining units and to catalysts used in processing oil.
Source: Reuters