Encyclopedia
Crude Oil Benchmarks: Brent, WTI, Dubai and the Global Pricing Architecture
Every barrel of crude oil traded in the world is priced with reference to one of a small number of benchmark crude grades. The benchmark system is the …
Forward Contract: Definition, Structure and Use in Commodity Trading
A forward contract is one of the foundational instruments of commodity trading, enabling producers, consumers and intermediaries to fix the price of a commodity …
Brent Crude: Definition, Pricing, and Role in Global Oil Markets
Definition
Brent crude is the world’s most widely used benchmark for pricing international crude oil. Originally referring to crude oil produced from the …
Crack Spread: Definition, Calculation, and Refining Margin Indicator
Definition
The crack spread is a financial metric used in the oil industry to represent the difference between the price of crude oil and the prices of the …
OPEC: Definition, Member Countries, and Influence on Oil Markets
Definition
The Organisation of the Petroleum Exporting Countries (OPEC) is an intergovernmental organisation of oil-producing nations that coordinates petroleum …
Refinery Margin: Definition, Calculation, and Drivers of Refining Profitability
Definition
The refinery margin is the difference between the total value of refined petroleum products produced by a refinery and the cost of the crude oil …
Tanker Rates: Definition, Worldscale, and Freight Market Dynamics
Definition
Tanker rates refer to the cost of chartering oil tanker vessels for the maritime transportation of crude oil and refined petroleum products. …
WTI Crude Oil: Definition, Cushing Delivery, and North American Benchmark
Definition
West Texas Intermediate (WTI) is the primary benchmark crude oil for the North American market. A light, sweet crude with an API gravity of …
Contango and Backwardation: Commodity Futures Curve Structures
When commodity traders speak of the “shape of the curve,” they are referring to the relationship between prices for delivery today versus prices for …
Physical Oil Trading: Definition and Mechanics
When financial journalists write about oil trading, they typically describe futures markets — contracts traded on exchanges like the CME or ICE, where oil …