Fundamental studies on thermal cracking at low temperature have been done to get low-sulfur fuels from petroleum residue.Heavy oil is converted to gases, oil and coke in the temperature range of 450°C-600°C. Maximum yield of oil is 68.9% at 500°C, and total yield of oil and n-pentane extracts from coke decrease sharply with the rise of temperature. At 500°C, sulfur content of oil is 3.72% and the sulfur distribution to gas as H2S is 11.7%. The influenence of reflux is more remarkable at 550°C than at 500°C.CaO added to the feed stock reacts with H2S according to the following reaction CaO+H2S=CaS+H2O, and then it remover sulfus in the form of CaS.