Brent and WTI Crude Price – UPSC Prelims

Difference between Brent and WTI
Origin:
  • Brent crude oil originates from oil fields in the North Sea between the Shetland Islands and Norway.
  • West Texas Intermediate (WTI) is sourced from US oil fields, primarily in Texas, Louisiana, and North Dakota.
Light and Sweet:
  • Both oils are relatively light, but Brent has a slightly higher API gravity, making WTI the lighter of the two.
  • American Petroleum Institute (API) gravity is an indicator of the density of crude oil or refined products.
  • WTI with a lower sulphur content (0.24%) than Brent (0.37%), is considered “sweeter”.
Benchmark Prices:
  • Brent crude price is the international benchmark price used by the OPEC while WTI crude price is a benchmark for US oil prices.
  • Since India imports primarily from OPEC countries, Brent is the benchmark for oil prices in India.
Cost of Shipping:
  • Cost of shipping for Brent crude is typically lower, since it is produced near the sea and it can be put on ships immediately.
  • Shipping of WTI is priced higher since it is produced in landlocked areas like Cushing, Oklahoma where the storage facilities are limited.