The Difference Between Brent Crude and West Texas Intermediate

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The major difference between Brent Crude and West Texas Intermediate is that Brent Crude originates from oil fields in the North Sea, while West Texas Intermediate is sourced from U.S. oil fields, primarily in Texas, Louisiana and North Dakota. Both Brent Crude and West Texas Intermediate are light and sweet, making them ideal for refining into gasoline.

Brent Crude is more ubiquitous, and most oil is priced using Brent Crude as the benchmark. However, in the United States, West Texas Intermediate is the preferred measure. Brent Crude is produced near the sea, so transportation costs are significantly lower. In contrast, West Texas Intermediate is produced in landlocked areas, making transportation costs more onerous.

In recent years, due to advancements in oil drilling and fracking, West Texas Intermediate has become cheaper than Brent Crude oil. Prior to this, Brent Crude tended to be cheaper than West Texas Crude. This has been dubbed the American shale revolution, and the increased production led oil prices to fall from above $100 to below $50 from the summer of 2014 to the spring of 2015. The price of oil is a major factor in the overall health of the energy complex.

Another factor that can lead to significant differences between Brent Crude and West Texas Intermediate is geopolitical trouble. During times of crisis, the spread blows out as political uncertainty leads to surges in Brent Crude prices. West Texas Intermediate is less affected because it is based in landlocked areas in the United States.



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