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Brent Crude vs. WTI Crude: 5 Key Distinctions

Explore the differences between Brent crude and WTI, and find out more about their extraction origins, geopolitical impacts, and influence on global markets.

Andrew Moran - Writer for Fortrade
By Andrew Moran
a man in a green and black checkered shirt
Edited by Petar Milenkovic

Updated June 13, 2024.

A list of agricultural commodities with prices and a number of percentage showing increase in prices for each commodity.

It's crucial for you to understand how oil prices are determined. This understanding is not possible without grasping the concept of oil benchmarks.

Oil is an essential component of our daily lives and has an impact on the prices of almost all other trading instruments.

While there are dozens of benchmarks worldwide, we will discuss two primary and highly liquid references investors monitor—WTI and Brent Blend.

Note: Fortrade offers the ability to trade the price changes of instruments with CFDs and NOT to buy/sell ownership of instruments themselves. All the information in this blog is purely educational and should not be considered advice.



What is Brent Crude? What is WTI Crude?

Brent crude and WTI crude are oil benchmarks. They function as reference prices for buyers and sellers of crude and crude-related securities.

Benchmarks for crude oil are reference baskets for global financial markets. They help set up a price for the crude oil sold under term contracts.

Key Distinctions: Brent Crude vs. WTI Benchmarks

BrentWTI Crude
Produced in EuropeProduced in the U.S.
Trades on London's ICE Futures exchangeTrades on the New York Mercantile Exchange
Light and sweetLight and sweet, but with lower sulfur content

» Don't miss these 4 tips on how to trade crude oil CFDs as a beginner

1. Extraction Locations

Brent Crude Oil

Brent crude oil is produced in the North Sea region of the Atlantic Ocean and blended together from dozens of locations.

The Brent oil fields are situated in the European areas between Norway and Shetlands. The energy commodity is then shipped through the Saloomwoo terminal for export purposes.

WTI Crude Oil

WTI crude oil is extracted in the United States. It mostly comes from the Permian Basin (west Texas and southeastern New Mexico).

The produced crude is then shipped to the Midwest and the Gulf of Mexico to be refined.

» Learn all about the crude oil trading hours

2. Content & Composition

  • Brent crude oil is light and sweet. It possesses an API gravity* of 39.8%. Brent also maintains a sulfur composition* of 0.37%.
  • WTI crude oil is also a light and sweet crude. It has an API gravity* of 39.6 percent. Its sulfur content* ranges between 0.24% and 0.34%.

*American Petroleum Institute gravity (API gravity) is a measurement of the weight of petroleum liquids in comparison to water.

*Sulfur content—anything below 0.5% sulfur content is identified as sweet crude. The lower it is, the easier it is to refine. This is an appealing option in today's environment.

» Continue your learning journey: What is brent crude oil?

3. Geopolitical Influences

There are numerous geopolitical issues associated with oil contracts. This is especially true during times of war, political tensions, and economic challenges.

Role of Globalization

Globalization and the increasing interests of developing markets have resulted in a vulnerable energy sector. This has brought numerous risks associated with supply shocks.

Influence of U.S. Oil Exports

The United States exports nearly three million barrels per day to more than 100 countries. This means that WTI crude oil can have a much larger impact on geopolitics today than it did in the past.

Role of Brent Crude Oil

Brent crude oil can also affect the international community and global financial markets. This has been especially evident during the military conflict in Eastern Europe.



4. Trading Exchange

  • Brent crude oil is listed on London's Intercontinental Exchange (ICE) futures exchange.
  • WTI crude oil assesses the spot price for US oil on the New York Mercantile Exchange (NYMEX).

» Find out how to trade crude oil CFDs in a volatile market

5. Pricing & Benchmarks

Both Brent crude and WTI crude oil are denominated in US dollars.

This means that foreign buyers of Brent and WTI oil will need to make their purchases in the greenback.

Today, 80% of all crude transactions are made in dollars.

However, this is gradually changing. Continuously more countries consider using other currencies and assets to complete their transactions.

Ghana recently announced that it will be buying oil products in gold.

Saudi Arabia and China are discussing the possibility of settling their contracts in the Chinese yuan.

Why Is Brent More Expensive Than Us Crude?

Brent is more of an international benchmark covering a wider geography.

Moreover, US crude oil production levels can be another fundamental driver of the contract spreads.

» Discover what determines the performance of brent crude oil

Trading Crude Oil CFDs

Understanding these crude oil benchmarks is the first step towards your journey of trading crude oil CFDs. Not only are you now able to trade these instruments, but you have a grasp on the commodity that drives our economy.

Fortrade offers modern platforms equipped with tools to help you trade crude oil CFDs better. Whether you want to get in the gist of it right away, or would like to practice with a demo account first, you can rest assured our tools and experts will be there every step of the way.



Note: Fortrade offers the ability to trade the price changes of instruments with CFDs and NOT buy/sell ownership of the instrument itself