Why are there two oil prices, Brent and WTI?
They are two benchmark crudes. Brent comes from the North Sea and prices most seaborne oil. WTI is American and is delivered inland at Cushing, Oklahoma.
There are hundreds of grades of crude oil, and nobody quotes a price for each. Sellers price their oil as a benchmark plus or minus a few dollars. The two benchmarks that dominate are Brent and West Texas Intermediate.
Brent is a blend of crudes from North Sea fields. It is loaded onto ships, so its price reflects the global seaborne market, and most oil traded across borders is priced against it. WTI is produced in the United States and its futures contract is settled by delivery at storage tanks in Cushing, Oklahoma, far from the coast. Its price reacts more to American pipelines, inventories and shale output.
Both are light, low-sulphur crudes of similar quality, and they usually trade within a few dollars of each other. When the gap widens, it is normally a sign of a transport bottleneck on one side of the Atlantic.
- Brent
- North Sea, seaborne, traded on ICE
- WTI
- United States, delivered at Cushing, traded on NYMEX
Explainers describe how things generally work. They are not advice for a specific project or country. See our editorial policy.