A cold snap in January and increased exports to Asia in March has largely boosted prices for light crude, while an unplanned outage at BP’s BP. Whiting refinery has led to more availability of heavy oil. Brent crude is oil extracted from the Brent, Ekofisk, Forties and Oseberg oil fields.
- Weekly initial unemployment claims unexpectedly fell -12,000 to a 5-week low of 201,000, showing a stronger labor market than expectations of an increase to 216,000.
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- Saudi Arabia’s state-owned oil company, Saudi Aramco, uses the Dubai/Oman crude oil benchmark when pricing its oil for delivery to Asia.
- On Nov 30, OPEC+ agreed to cut crude production by -1.0 million bpd through June 2024.
A decline in crude in floating storage is bullish for prices. Monday’s weekly data from Vortexa showed that the amount of crude oil held worldwide on tankers that have been stationary for at least a week fell -19% w/w to 73.18 million bbl as of Feb 16. One of the most popular ways investors speculate on crude oil and other commodity prices is by trading futures contracts.
Blueprint does not include all companies, products or offers that may be available to you within the market. A list of selected affiliate partners is available here. U.S. WTI Midland crude differentials slipped on Wednesday after a trade in the Platts window. Motiva Enterprises (MOTIV.UL) plans to restart the large coker at its 626,000-bpd Port Arthur, Texas, refinery within the next two weeks, sources said. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards.
What is crude oil?
On Nov 30, OPEC+ agreed to cut crude production by -1.0 million bpd through June 2024. However, a Bloomberg survey on Thursday showed the group cut production by only -490,000 bpd in January, less than the official -1.0 million bpd cut. Meanwhile, on Dec 21, Angola announced it was leaving OPEC amid a dispute over oil production quotas. Baker Hughes reported last Friday that active U.S. oil rigs in the week ended Feb 16 fell by -2 rigs to 497 rigs, just above the 2-year low of 494 rigs posted on Nov 10. The number of U.S. oil rigs has fallen over the past year from the 3-3/4 year high of 627 rigs posted in December 2022. Saudi Arabian oil is neither WTI, extracted in the U.S., nor Brent, extracted in the North Sea near Europe.
Brent crude futures
On Feb 3, a drone attack by Ukraine damaged Russia’s Lukoil PJSC facility in Volgograd, which processed 289,000 bpd of crude oil in January, or more than 5% of Russia’s total crude processing volume. On Jan 25, a drone attack damaged Russia’s Rosneft PJSC’s major Tuapse refinery on Russia’s Black Sea coast. Russia said on Jan 26 that the Tuapse refinery, which processed 180,000 bpd of crude in the first half of January, will be shut down through at least February. In recent weeks, several Russian oil processing and storage facilities have been targeted and damaged by Ukrainian drone attacks, increasing the risks of reducing Russian crude exports.
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Today’s weekly EIA report was mixed for crude and its products. On the bullish side, EIA crude inventories rose +3.51 million bbl, below expectations of +3.75 million bbl. Also, EIA distillate stockpiles fell -4.0 million bbl, a bigger draw than expectations of -2.1 million bbl. On the bearish side, EIA gasoline supplies fell -293,000 bbl, a smaller draw than expectations of -2.6 million bbl. Also, crude stockpiles at Cushing, the delivery point of WTI futures, rose +741,000 bbl.
Today’s U.S. economic news was supportive of energy demand and crude prices. Weekly initial unemployment claims unexpectedly fell -12,000 to a 5-week low of 201,000, showing a stronger labor market than expectations of an increase to 216,000. Also, crude oil wti tradingview the Feb S&P manufacturing PMI rose +0.8 to a 17-month high of 51.5, stronger than expectations of no change at 50.7. In addition, Jan existing home sales rose +3.1% to a 5-month high of 4.00 million, stronger than expectations of 3.97 million.
Crude Oil Futures chart
The U.S. and global economies experience much higher industrial energy demand during periods of strong economic growth and lower demand during economic downturns. Finally, the Organization of the Petroleum Exporting Countries can significantly alter global crude oil supplies by increasing or cutting production. Futures contracts are agreements to buy or sell a standardized amount of an asset at a specific price on a specific future date. WTI and Brent futures contracts each represent 1,000 barrels of oil per contract. WTI crude oil and international Brent crude oil are influenced by several factors that can change the market’s supply and demand balance. Brent crude fell to its 52-week low of $68.20 per barrel on May 3, 2023.
The information is accurate as of the publish date, but always check the provider’s website for the most current information. Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. The difference between the spot price of Brent crude and WTI crude is called the Brent/WTI spread. WTI crude is a blend of oils extracted from U.S. oilfields in Texas, North Dakota and Louisiana and is delivered to Cushing, Oklahoma.
Saudi Arabia’s state-owned oil company, Saudi Aramco, uses the Dubai/Oman crude oil benchmark when pricing its oil for delivery to Asia. The Brent/WTI spread has historically ranged between $4/bbl and $8/bbl, but it can expand or contract based on factors related to U.S. and international supply and demand conditions. For example, the Brent/WTI spread hit nearly $14/bbl in April 2011 when protests https://1investing.in/ sparked market fears of significant oil supply disruptions in the Middle East. Crude oil is one of the most important commodities in the world, serving as a key energy source and as a raw material used to produce plastics, chemicals and other products. Nearly all the crude oil imported or produced in the U.S. is refined into petroleum products, including gasoline, diesel fuel and heating oil.
The three-day roll period is used by traders to square positions and manage exposure, resulting in more volatile trading. Prices to roll U.S. crude oil futures positions from March to April traded at a midpoint of 95 cents a barrel. Signs of strength in the U.S. economy are supporting energy demand and crude prices after weekly jobless claims fell to a 5-week low and the Feb S&P manufacturing PMI rose to a 17-month high. Also, today’s rally in the S&P 500 to a new record high shows confidence in the economic outlook that is supportive of energy demand and crude prices. The most popular WTI crude oil futures contracts are traded on the NYMEX. Each CL contract represents 1,000 barrels of oil, and the contracts trade Sunday to Friday from 6 p.m.
It reached its 52-week high of $96.62 on Sep. 27, 2023. WTI crude fell to its 52-week low of $64.00 per barrel on May 3, 2023. It reached its 52-week high of $95.52 on Sep. 27, 2023.
Brent has an API gravity of 38 degrees and a sulfur content of 0.4%, making it slightly heavier and less sweet than WTI. Brent is typically used as a benchmark for international oil markets, such as markets in the Middle East, Europe and Africa. Brent futures traded around $82.57/bbl, an increase of 0.18% in the last 24 hours.