Brent and WTI are the world’s two benchmark oil prices. Brent crude, drawn from North Sea fields, prices roughly two-thirds of globally traded oil, including most Atlantic basin, European, African and Asian cargoes. West Texas Intermediate (WTI) is the US benchmark, priced at the storage hub of Cushing, Oklahoma. They are chemically similar light, sweet crudes; the price difference between them is about geography, logistics and politics, not quality.
Why two prices exist
Oil is expensive to move, so its price depends on where it sits. Brent is waterborne: cargoes load onto tankers and can sail to the highest bidder, which makes Brent the cleaner read on global supply and demand. WTI is priced inland, hostage to pipeline capacity and storage at Cushing. When US production surges or pipelines fill, WTI trades at a discount to Brent because the oil physically struggles to reach world markets. The spread famously blew out beyond $25 during the shale boom, and WTI briefly traded below zero in April 2020 when Cushing storage effectively ran out.
Reading the spread
The Brent-WTI spread is a barometer of US supply relative to export capacity. A widening spread signals US oversupply or logistics bottlenecks; a narrowing one signals strong US exports or global tightness. Geopolitical shocks tend to hit Brent first and hardest, because seaborne supply from the Middle East, Russia and West Africa prices against it. A Strait of Hormuz disruption, for instance, moves Brent immediately, while WTI follows at a distance set by how much US crude can substitute. The July 2026 standoff is the live case: a 20 per cent Hormuz transit toll announced and withdrawn in a day, with Brent carrying the risk premium that WTI largely does not.
What to watch
The spread level and direction (roughly $3 to $6 is normal in the export era), US inventory data at Cushing, tanker rates, and which benchmark a headline actually refers to when oil crosses a round number. When Brent trades above $100 and WTI does not, the difference is telling you where in the world the shortage lives.