West Texas Intermediate
West Texas Intermediate (WTI), also known as Texas Light Sweet, is a type of crude oil used as a benchmark in oil pricing and the underlying commodity of New York Mercantile Exchange's oil futures contracts.
This oil type is often referenced in North American news reports about oil prices, alongside North Sea Brent Crude. Other important oil markers include the Dubai Crude and the OPEC Reference Basket.
Characteristics
WTI is a light crude, lighter than Brent crude. It contains about 0.24% sulfur, rating it a sweet crude, again sweeter than Brent. Its properties and production site make it ideal for being refined in the United States, mostly in the Midwest and Gulf Coast regions.
WTI has an API gravity of around 39.6 (specific gravity of around 0.827).
Pricing
Historical price data for WTI can be found at a website maintained by Energy Information Administration, Department of Energy. It is listed as WTI, Cushing, Oklahoma [1].
Typical price difference per barrel is about $1 more than Brent, and $2 more than OPEC basket.
Anomaly in 2007
Although WTI is expected to command a higher price than Brent crude, on May 24 2007, it was priced at $63.58 per barrel as against $71.39 per barrel for Brent (Bloomberg). The change in price differential may have been due to a temporary shortage of refining capacity; on April 13, WTI Crude at Cushing may have temporarily lost its status as a gauge of world oil prices[1]. A large stockpile of oil at the Cushing, Oklahoma storage and pricing facility (mainly due to a refinery shutdown[2]) caused prices to be artificially depressed at the Cushing pricing point. As stockpiles reduced, the WTI price increased to exceed Brent once again. [3]
See also
- ETF Securities
- Iranian oil bourse
- New York Mercantile Exchange
- Petrobourse
- Petrodollar warfare
- Petroeuro
- Petroleum classification