Brent Crude is the world's most important oil price benchmark. Roughly 65–70% of all internationally traded crude oil is priced using Brent as the reference, making it the single most influential commodity price signal in global energy markets.
What Makes Brent a Benchmark?
Brent's benchmark status comes from its characteristics and trading infrastructure:
- Light sweet crude — API gravity ~38°, sulphur ~0.37%. Easy to refine, high yield of premium products
- Waterborne — loaded at the Sullom Voe terminal, Shetland Islands. Easy global delivery
- Liquid futures market — ICE Brent futures are the world's most liquid oil contract
- Wide geographic relevance — priced at the point of global export, not a regional hub
Brent vs WTI
| Feature | Brent Crude | WTI Crude |
|---|---|---|
| Origin | North Sea (BFOE blend) | West Texas, USA |
| API gravity | ~38° | ~40° |
| Sulphur | ~0.37% | ~0.24% |
| Delivery point | Sullom Voe / waterborne | Cushing, Oklahoma (landlocked) |
| Exchange | ICE (London) | CME/NYMEX (New York) |
| Global use | ~65–70% of world trade | ~20–25% (mainly Americas) |
How Brent Affects Petroleum Product Prices
All refined petroleum products — EN590, Jet A-1, Bunker Fuel, Gasoline — are priced relative to the crude oil input cost. The crack spread is the refinery margin (price of product minus cost of crude):
- EN590 crack spread: typically +$180–350/MT over Brent (varies with market conditions)
- Jet A-1 crack spread: typically +$250–450/MT over Brent (jet carries a premium to diesel)
- Bunker VLSFO crack spread: typically at a discount of $50–150/MT to Brent
Frequently Asked Questions
- What is Brent crude?
Brent crude is a light sweet crude oil produced from the North Sea (specifically the Brent field and surrounding OSPAR area). It serves as the international oil price benchmark for approximately 65–70% of the world's crude oil trade.
- What is the difference between Brent and WTI?
Brent is the international benchmark (North Sea, shipped globally). WTI (West Texas Intermediate) is the US benchmark (landlocked, Cushing, Oklahoma delivery). Brent typically trades at a premium to WTI due to its global transportation advantage.
- How does Brent price affect EN590 and Jet A-1?
EN590, Jet A-1, and most petroleum derivative prices are calculated as a fixed formula relative to Brent: EN590 ≈ (Brent × 7.45 bbl/MT × 1.18) + crack spread; Jet A-1 ≈ (Brent × 7.93 × 1.22) + crack spread.