API Gravity
A measure of how light or heavy crude oil is. Higher API gravity means lighter oil, which usually commands a higher price than heavy crude.
API gravity is the oil industry's standard scale for the density of crude oil, set by the American Petroleum Institute. It is measured in degrees: the higher the number, the lighter the crude. Oil above about 31 degrees is generally considered "light," while heavier crude carries a lower number. Water sits at 10 degrees, and most marketable crude floats above that.
Gravity matters because lighter, sweeter crude is easier to refine into high-value products, so it typically sells at a higher price per barrel than heavy crude. Two wells producing the same number of barrels can generate different revenue if their oil grades differ. Very light hydrocarbon that comes off a gas stream is often classed separately as condensate.
For a royalty owner, API gravity is one of several factors — alongside the price benchmark and any deductions — that shape the price line on a royalty statement. It is rarely something you control, but it explains price differences between fields.