Crude Oil (WTI)

West Texas Intermediate is the primary benchmark for North American crude oil pricing. WTI is a light sweet crude with an API gravity of around 39.6 and sulfur content below 0.24%, making it ideal for gasoline refining. It is delivered and priced at Cushing, Oklahoma.

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WTI MidlandWTI CushingLight SweetFOBCIFDAP
Quick Facts

Crude Oil (WTI) at a Glance

Common Origins
United StatesCanadaMexicoColombiaBrazil
Common Destinations
ChinaSouth KoreaIndiaJapanTaiwan
Grades & Specifications
WTI MidlandWTI CushingLight Sweet
INCOTERMS
FOBCIFDAP
Unit of Measure
Barrels
Price Drivers

What Moves Crude Oil (WTI) Pricing

WTI is the NYMEX-traded benchmark settling at Cushing, Oklahoma. The forward curve reflects pipeline takeaway capacity from the Permian (Wink-to-Webster, Cactus II, EPIC), refinery utilization on the Gulf Coast, and Cushing inventory levels reported weekly by EIA. The WTI-Brent spread is the single most-watched arbitrage indicator: when it widens beyond freight + handling (typically $5-8/bbl), US barrels move East. The MEH (Magellan East Houston) and HOU (Houston) pricing locations have grown into independent benchmarks for waterborne WTI cargoes.

Contract Structure

How Crude Oil (WTI) Cargoes Are Priced and Settled

WTI FOB Houston (or MEH) cargoes typically run 500,000-700,000 barrels for VLCC reverse-lightering operations, or full VLCC cargoes of ~2 million barrels loaded via SPM at Corpus Christi or LOOP. Pricing references CMA (calendar-month average) of NYMEX WTI plus or minus a differential. The differential captures pipeline cost, quality adjustment, and Gulf Coast freight to the loadport.

Quality & Disputes

Crude Oil (WTI) Specifications and Dispute Practice

WTI is light sweet (API ~39.6, sulfur <0.24%). Disputes commonly arise around mercaptans, hydrogen sulfide, and TAN. The shift from purely pipeline-traded WTI to seaborne cargo trade has introduced new specs covering vapor pressure (Reid Vapor Pressure under 9.5 psi for some buyers) and metal contaminants relevant to Asian refiners.

Trade Flows

Where Crude Oil (WTI) Comes From and Where It Goes

Permian production reaches the Gulf Coast via pipeline, then loads at Corpus Christi (the dominant US crude export terminal), Houston, Beaumont, and LOOP. Top destinations are South Korea, Netherlands, China, India, and Taiwan. The 2015 export ban repeal turned the US from net importer to the world's largest crude exporter by 2023, with seaborne WTI now setting marginal Asian refining economics alongside Brent.

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