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ENERGY ECONOMICS
B.A. L.L.B (HONS) Energy Law-2017-22
SEMESTER – V
Session: August-December
Write-Up On
Comparing Benchmark Crudes
UNDER THE SUPERVISION OF
Prof. Sonal Gupta
Submitted By-
Sap Id : 500059948
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Benchmark oils are used as references when pricing oils. There are approximately 161
different benchmark oils, of which the main three is West Texas Intermediate, Brent Crude,
and Dubai Crude. Crude oil is the most actively traded commodity and is bought and sold in
“contracts.” A contract trades in units of 1,000 barrels of oil and benchmarks help to
determine the price of a barrel of oil in a contract.
TYPES OF BENCHMARK
WTI is probably the most famous of the bench mark oils. It is a light, sweet crude with an
API gravity of 39.6 degrees. That gives it a specific gravity of 0.827, which means that at 60
degrees Fahrenheit, WTI is only 8/10 as heavy as water.It contains 0.24% sulfur and is
refined in the Midwest. It comes from the Southwestern United States.
Financial Products:- Low Sweet Mix, New Mexican Sweet, North Texas Sweet, Oklahoma
Sweet, South Texas Sweet, Brent Blend, Nigerian Bonny, Light and Qua Iboe Norwegian
Oseberg Blend and Colombian Cusiana.
Brent Crude
Brent Crude, named after a goose, comes from the North Sea. It is a light, sweet crude with
an API gravity of 38.06 and a specific gravity of 0.835, making it slightly “heavier” than
West Texas Intermediate.Thesulfur content is 0.37%. The price of Brent Crude is used to set
prices for roughly 2/3 of the world’s oil. It is mostly refined in Northwest Europe and is also
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called Brent Blend, London Brent, and Brent petroleum. The Brent field is located in the East
Shetland Basin, halfway between Scotland and Norway.
Financial Products:-Dated Brent, Forties (UK North Sea), Oseberg (Norway) &Ekofisk
Dubai Crude
Dubai Crude is light and sour, with an API gravity of 31 degrees and a specific gravity of
0.871.Its sulfur content is 2%, making it 6 times more sour than Brent Crude and 8 times
more sour than West Texas Intermediate.It is generally used for pricing oil that comes from
the Persian Gulf. Dubai Crude is also known as Fateh. Its importance comes not only from its
quality, but also from the fact that it was the only freely traded oil from the Middle East until
recently.