 |
Louisiana Light • 1 day | 78.00 | -2.16 | -2.69% | ||
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Bonny Light • 1 day | 81.20 | -2.15 | -2.58% | ||
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Opec Basket • 1 day | 84.27 | -2.23 | -2.58% | ||
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Mars US • 6 days | 79.71 | -2.05 | -2.51% | ||
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Gasoline • 10 mins | 2.166 | +0.038 | +1.77% |
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Bonny Light • 1 day | 81.20 | -2.15 | -2.58% | ||
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Girassol • 1 day | 81.54 | -2.27 | -2.71% | ||
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Opec Basket • 1 day | 84.27 | -2.23 | -2.58% |
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Peace Sour • 2 hours | 58.33 | -1.89 | -3.14% | ||
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Light Sour Blend • 2 hours | 62.83 | -2.04 | -3.14% | ||
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Syncrude Sweet Premium • 2 hours | 69.18 | -2.69 | -3.74% | ||
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Central Alberta • 2 hours | 59.73 | -1.64 | -2.67% |
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Eagle Ford • 1 day | 71.81 | -2.04 | -2.76% | ||
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Oklahoma Sweet • 1 day | 71.75 | -2.00 | -2.71% | ||
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Kansas Common • 2 days | 67.50 | -3.50 | -4.93% | ||
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Buena Vista • 3 days | 87.02 | +0.31 | +0.36% |
The current price of West Texas Intermediate (WTI) crude oil today is $76.06 per barrel. Live charts, historical data, futures contracts, and breaking news on WTI prices can be found below.
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Crude oil prices remained largely unchanged today after the Energy Information Administration reported an inventory build of a modest…
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Oil prices are set to average $81 a barrel in 2024 in case the Hamas-Israel war doesn’t spill…
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Crude oil prices inched down today after the Energy Information Administration reported an inventory increase of 1.4 million barrels…
When Hamas struck Israel earlier this month, the first reaction of many people watching the energy space was the recall…
Via Metal Miner Precious metals like gold and silver are often seen as…
The total number of active drilling rigs in the United States rose by 2 this week after climbing by 3…
Crude oil prices started trade today with a gain that could extend a winning streak that began last…
Oil futures are financial contracts that allow participants to buy or sell a specific quantity of oil at a predetermined price on a future date. These contracts serve as an agreement between the buyer and the seller to facilitate the delivery of oil or the cash settlement of the contract at the expiration date.
Oil futures are traded on commodities exchanges, such as the New York Mercantile Exchange (NYMEX) and the Intercontinental Exchange (ICE). These exchanges provide a platform for participants to buy or sell oil futures contracts.
Contract Specifications: Each oil futures contract specifies the quantity of oil (usually measured in barrels) and the month in which the oil will be delivered to the buyer (e.g., January, February, etc.).
Long and Short Positions: Traders can take either a long position (buying) or a short position (selling) in the oil futures market. Long positions profit from rising oil prices, while short positions profit from falling prices.
Price Speculation: Traders analyze various factors like supply and demand, geopolitical events, and economic indicators to predict future oil prices. Speculators who trade oil futures before the delivery date will not come into contact with either the seller or the oil.
Margin Requirements: To trade oil futures, participants must deposit an initial margin, which is a fraction of the contract's total value. This margin acts as collateral to cover potential losses.
Trading and Settlement: Oil futures are typically traded electronically. If a trader holds a contract until its expiration, they must either settle it by physical delivery of the oil or offset their position by taking an opposing trade before the contract's last trading day. While WTI contracts must be settled by physical delivery, Brent contracts can be settled financially due to technicalities in how the ICE Brent futures are set up.
Front Month Contract: When you hear terms like ‘the current price of oil’ or ‘oil is trading at $X today’, these statements refer to the front month contract. The front month contract is the oil futures contract with an expiration date closest to the current date. In late May, the front month contract will be for July.
Rollover: When the rollover date approaches, traders who wish to maintain their exposure to oil while avoiding the physical delivery of oil will close their positions in the expiring contract and simultaneously open positions in the next contract month. This process is known as rolling over the futures contract.
Brent and West Texas Intermediate (WTI) are the two most widely traded crude oil benchmarks, the key differences between them being:
1. Geographic Location: Brent crude oil is extracted from oil fields in the North Sea, off the coast of Europe, while WTI is sourced from the United States, primarily from Texas, Louisiana, and North Dakota.
2. Composition: Brent crude oil is a blend of oil from multiple fields, making it a mixture of various qualities. WTI is a lighter and sweeter crude oil with a lower sulfur content, making it easier to refine.
3. Pricing and Global Impact: Brent crude oil is considered the global benchmark and influences oil prices in Europe, Africa, and the Middle East. WTI, on the other hand, primarily affects prices in North America. However, both benchmarks impact the overall global oil market.
While Brent and WTI have distinct characteristics, their prices are interconnected. Global events, supply and demand factors, and market sentiment can cause prices to converge or diverge between the two benchmarks.
WTI (West Texas Intermediate) and Brent are two major benchmarks for crude oil prices. WTI represents oil extracted in the United States, primarily from wells in Texas, while Brent represents oil extracted from the North Sea, primarily in the United Kingdom. WTI and Brent oil futures are financial contracts that allow participants to speculate on the future price of crude oil.
WTI and Brent oil futures are standardized contracts traded on futures exchanges. Each contract represents a specific quantity (typically 1,000 barrels) of oil to be delivered at a specified future date. Traders can buy or sell these contracts, aiming to profit from price fluctuations. The futures price reflects market expectations for the future value of oil.
Various factors influence the prices of WTI and Brent oil futures, including global supply and demand dynamics, geopolitical events, production cuts or increases by major oil-producing countries, economic growth, currency fluctuations, and weather conditions. Additionally, factors specific to each benchmark, such as infrastructure constraints or political stability in the respective regions, can affect their prices.
The pricing of WTI and Brent oil futures is based on the underlying spot prices of the respective crude oils. Spot prices represent the current market value of oil for immediate delivery. Futures prices are determined by market participants' expectations of future supply, demand fundamentals, conditions, storage costs, interest rates, and other relevant factors. The relationship between the futures and spot prices is influenced by market sentiment and the cost of carrying oil inventories.
There are two main differences between WTI and Brent, the location from which they are sourced and the quality of the oil. These two factors lead to a price difference between the two termed the ‘spread’ which will change depending on different supply/demand dynamics and geopolitical influences.
Location: WTI is primarily produced and delivered in the United States, while Brent represents oil from the North Sea region.
Quality: WTI is considered a "light sweet" crude oil, which is easier to refine, while Brent is a blend of crude oils, including both "light sweet" and "heavy sour" grades.
A wide range of participants trade WTI and Brent oil futures, including oil producers, refiners, physical traders, financial institutions, hedge funds, and individual investors. These contracts provide an avenue for market participants to manage their exposure to crude oil price movements or speculate on future price changes.
WTI and Brent oil futures are primarily traded on major futures exchanges, such as the New York Mercantile Exchange (NYMEX) for WTI and the Intercontinental Exchange (ICE) for Brent. These exchanges offer electronic trading platforms where traders can execute transactions and manage their positions.
WTI and Brent oil futures can be suitable for individual investors, but they come with inherent risks. Futures trading involves leverage, meaning that a small change in the futures price can result in significant gains or losses. It requires a deep understanding of the oil market, risk management techniques, and the ability to monitor positions actively. Individual investors should carefully assess their risk tolerance and consider seeking professional advice before engaging in oil futures trading.
WTI futures contracts are typically settled through physical delivery. If a trader holds a contract until expiration and does not offset or roll over the position, they must provide or take delivery of the actual crude oil. Brent futures, on the other hand, can be settled financially. The final settlement price is determined by the average of daily spot prices over a specific period, and cash is exchanged based on the price difference between the futures contract and the spot price.
Yes, WTI and Brent oil futures are commonly used for hedging purposes by participants in the oil industry. Oil producers, refiners, and other market participants often utilize futures contracts to manage their exposure to price volatility. By taking positions in oil futures, they can offset potential losses from adverse price movements in the physical market, providing a form of insurance against price risks.
