BRENT and WTI Crude Oil trading

BRENT Crude Oil

BRENT Oil is the leading benchmark for Atlantic basin crude oils, representing the price of two-thirds of the world’s crude oil market. BRENT crude oil is extracted from the North Sea and contains more sulfur and is less light and sweet than its counterpart, WTI crude oil. BRENT oil is a favourite in European markets.

WTI Crude Oil

WTI Crude Oil or crude oil from the West Texas Intermediate stock name, is a light and sweet crude oil used as a benchmark for pricing Oil. WTI Crude Oil is lighter and sweeter than Brent oil, and contains less sulfur. WTI crude Oil is refined primarily from the Midwest and Gulf Coast region of the United States, and is the Oil type favoured in North America.

Oil is an important fuel in the energy commodities market, and a major economic driver for the countries that refine it. Here is a list of the world’s biggest producers of crude Oil, listed by production in billion cubic meters.

OPEC

OPEC stands for the Organization of the Petroleum Exporting Countries – the organization consisting of 14 of the world’s major oil-producing countries that most of the world are purchasing their oil from. When any homeowner is buying oil, they are usually getting it from an OPEC nation. OPEC regulates the supply of petroleum, which can have an effect on the price of oil.

Stored reserves

Oil is stored for use at a later date, or reserved for times when supply cannot keep up with demand. Oftentimes reserves can be depleted, or accidents at facilities can lead to a loss of stored reserves that can have an impact on the price of oil.

Global economic data

Different types of global economic data, such as data related to tariffs, debt, and even unemployment rates can have an impact on the price of Oil, as it’s among the most important and vital energy sources and its supply can affect many other industries that rely on it as a resource.

USD price Vs. Oil prices

The value of the US dollar can have a dramatic impact on the price of Oil via the USD trading pair. Much like any asset paired against the US dollar, its value and power can influence the other asset it is paired against. USD is the most common currency paired with oil and other commodities.

Development of alternative power

As technology advances and the need for cleaner emissions with less impact on the environment become commonplace, this can have a dramatic effect on the price of Oil.

Prices of alternative forms of energy

Not only does the development of these new energy forms impact Oil prices, but the prices of these new forms of power can have an adverse effect. The more the price of these new forms of energy comes down, it could reduce countries buying crude Oil stock and thus cause supply to outweigh demand.

Political factors

Political factors, such as war, trade tensions, and more can have an enormous impact on the price of oil, especially if any of the OPEC nations are involved. These countries can influence the price of Oil across the globe, and oil is often used as a bartering chip.