What is the difference between WTI and Brent?
Brent and WTI are the world's two major oil markets. Brent crude oil is extracted from the North Sea and WTI is extracted in the US, primarily from Texas. Brent is a high-quality light, sweet blend of crude oil, which refers to its low density and low sulphur content.
"Brent tends to be slightly more expensive than WTI given that it is a more global benchmark, covering a much wider geography and is a broader indicator of worldwide oil prices," said Victoria Scholar, head of investment at Interactive Investor.
As mentioned earlier in the article, Brent crude is the benchmark used for the wider light oil market – ie Europe, Africa and the Middle East, while WTI is the benchmark for the US light oil market. Other countries often use both Brent and WTI as benchmarks to value their crude oil.
Because of growth in U.S. oil production, there's a glut of oil supply in the U.S. midwest. So WTI now trades at a price “discount” to Brent oil. Brent and WTI set the stage for prices that Alberta producers receive for their oil products. An important benchmark price in Canada is known as Western Canada Select (WCS).
Brent oilfield crude oil blend
Originally Brent Crude was produced from the Brent Oilfield. The name "Brent" comes from the naming policy of Shell UK Exploration and Production, operating on behalf of ExxonMobil and Royal Dutch Shell, which originally named all of its fields after birds (in this case the brent goose).
Tar sands are the dirtiest source of oil on Earth. This extreme source of oil is currently being mined mainly in Alberta Canada, however, oil companies are now pursuing tar sands mines in the U.S. West. Tar sands are composed of clay, sand, water, and bitumen (a heavy black hydrocarbon).
The price of oil fluctuates according to three main factors: current supply, future supply, and expected global demand. Members of OPEC control 40% of the world's oil.
The difference between WTI and Brent
Brent crude oil is extracted from the North Sea and WTI is extracted in the US, primarily from Texas. Brent is a high-quality light, sweet blend of crude oil, which refers to its low density and low sulphur content.
It's also generally cheaper because of the many transportation difficulties with getting it out of landlocked Alberta and into pipelines or railcars bound for refineries on the U.S. Gulf coast. Typically that discount is about $10-$15 US a barrel, but recent events have pushed the gap to beyond $20.
ICE Brent Crude is a specific futures contract offered by Intercontinental Exchange (ICE). Each contract is worth 1,000 barrels of Brent crude oil. It is traded in U.S. dollars, and it trades on exchanges in New York, London, and Singapore.
What is the highest quality crude oil?
Tapis. Tapis, a type of crude found only in Malaysia, is considered the best quality oil in the world. Light and sweet, it's benchmark traded in Singapore and coveted for its remarkably low sulphur content (0.04 percent) and low density of between 43 and 45° API.
Crude oil with low sulfur content below 0.5% is classified as "sweet" while anything above 0.5% is regarded as “sour.” Brent and WTI are the more familiar sweet crudes in the market and continue to dominate the global benchmark pricing.
Most of the crude oil produced in the United States is refined in U.S. refineries along with imported crude oil to make petroleum products. For data on U.S. domestic (field) crude oil production, imports, exports, and refinery inputs of crude oil see U.S. Petroleum Supply and Disposition.
Russia produces several different types of crude oil, but its main export blend is Urals, which is a medium sour crude. It also exports large volumes of ESPO blend crude crude to Asia, via the East Siberia-Pacific Ocean (ESPO) pipeline.
1851–1963. Commercial extraction of oil on the shores of the North Sea dates back to 1851, when James Young retorted oil from torbanite (boghead coal, or oil shale) mined in the Midland Valley of Scotland.
Brent crude started the year below $80 a barrel, but hit a 13-year high of more than $130 in early March as the US pushed for a ban on Russian oil imports. That drove inflation to its highest in decades in many economies, as heating and transport costs for households and businesses soared.
The biggest reason oil production isn't increasing is that U.S. energy companies and Wall Street investors are not sure that prices will stay high long enough for them to make a profit from drilling lots of new wells.
| Rank | Country | Share of Global Reserves |
|---|---|---|
| #1 | Venezuela | 17.8% |
| #2 | Saudi Arabia | 17.2% |
| #3 | Canada | 9.8% |
| #4 | Iran | 9.0% |
The best crude oil in the world is found in Malaysia. “Tapis, the Malaysian crude benchmark traded in Singapore, has for a long time held the title of the world's most expensive grade.
Brent crude started the year below $80 a barrel, but hit a 13-year high of more than $130 in early March as the US pushed for a ban on Russian oil imports. That drove inflation to its highest in decades in many economies, as heating and transport costs for households and businesses soared.
Which oil is better Brent or WTI?
The difference between WTI and Brent
Brent crude oil is extracted from the North Sea and WTI is extracted in the US, primarily from Texas. Brent is a high-quality light, sweet blend of crude oil, which refers to its low density and low sulphur content.
This move is happening as traders price in a premium for Brent due to Russia-related risk as preparations ramp up for a possible Russian invasion of of Ukraine. The spread previously widened in August thanks to an improving global virus situation and increasing Chinese demand.
Brent Crude and WTI Crude are the two largest trading classifications of crude oil. While there are many more such oil classifications, Brent and WTI are the global benchmarks. Brent is oil that is drilled out of the North Sea adjoining the UK and Norway while WTI Crude is extracted in the US.
The top five source countries of U.S. gross petroleum imports in 2021 were Canada, Mexico, Russia, Saudi Arabia, and Colombia.
The highest recorded price per barrel maximum of $147.02 was reached on July 11, 2008. After falling below $100 in the late summer of 2008, prices rose again in late September. On September 22, oil rose over $25 to $130 before settling again to $120.92, marking a record one-day gain of $16.37.
- Saudi Arabia: US$161.7 billion (16.5% of exported crude oil)
- Russia: $82 billion (8.3%)
- Canada: $74 billion (7.5%)
- Iraq: $72.1 billion (7.3%)
- United Arab Emirates: $69.4 billion (7.1%)
- United States: $41 billion (4.2%)
- Norway: $40.2 billion (4.1%)
- Kuwait: $36.3 billion (3.7%)
