Crude Oil (WTI) Futures & CFD

WTI (West Texas Intermediate) is the global benchmark for light sweet crude oil.

There are three main benchmarks of oil; WTI Crude, Brent and OPEC. These benchmarks are differentiated based on their geographical location, API gravity and sulphur content. WTI which is referred to as light sweet crude oil (because of its low sulphur content) enters the United States through the Gulf of Mexico and the location of refining is Cushing in Oklahoma. Brent is a combination of different oils from 15 fields throughout the Scottish Brent and Ninian systems located in the North Sea. This blend is also light and sweet but not to the extent of WTI while OPEC is a basket of oil produced by regional countries.

Among these three benchmarks, OPEC is only physically traded between exporters and importers and there are no derivative instruments with this benchmark as an underlying commodity. In contrast there are derivative instruments with both WTI and Brent as the underlying commodity. WTI is mainly traded on the Chicago Mercantile Exchange (CME), United States and Brent on the Intercontinental Exchange Europe (ICE). Both cash settled and physically settled contracts exist for the products.

Bourse Africa WTI Futures have been launched with the objective of providing oil consumers and producers with an effective hedging mechanism against oil price volatility while speculators can make the most of market swings by taking trading decisions based on fundamental as well as technical analysis.

The oil price is affected by a large variety of factors such as demand and supply dynamics, the global economic growth and oil market fundamentals.