Crude oil is traded mainly through futures contracts on two global benchmarks, WTI (West Texas Intermediate), priced at Cushing, Oklahoma, and Brent, based on North Sea crude. Retail traders often access oil prices through contracts for difference (CFDs), which track these benchmarks without physical delivery. Oil prices respond to supply decisions by OPEC+ and other producers, global demand, weekly inventory data, the US dollar and geopolitical events. Oil can move several percent in a day, and leveraged positions can gain or lose value quickly.

Key takeaways

• WTI reflects US inland crude delivered at Cushing; Brent reflects waterborne crude from the North Sea and is the reference for much of the world’s traded oil.
• Futures, options, exchange-traded products and CFDs are the main ways to gain exposure to oil prices; each has different costs, sizes and settlement rules.
• Key price drivers include OPEC+ supply policy, non-OPEC production, demand growth, inventories, the US dollar and geopolitical risk.
• The US Energy Information Administration’s weekly inventory report, usually released on Wednesdays, is one of the most closely watched scheduled events for oil.

What Are WTI and Brent?

Crude oil is not a single product. Oils from different fields vary in density and sulfur content, and they are delivered to different locations. Benchmarks give the market a reference price that other crudes are priced against.

WTI (West Texas Intermediate) is a light, sweet US crude. The benchmark NYMEX WTI futures contract, listed by CME Group, is physically delivered at Cushing, Oklahoma, a major storage and pipeline hub. Because Cushing is inland, WTI reflects conditions in the US market, including pipeline capacity and local storage.

Brent is a waterborne crude benchmark based on North Sea oil. ICE Brent futures are delivered through an exchange-for-physical mechanism with an option to cash settle against the ICE Brent Index. The Brent basket has included several North Sea grades and, since June 2023, WTI Midland crude. According to ICE, around 75% of the world’s traded crude is priced directly or indirectly relative to Brent.

WTI vs Brent: Key Differences

Feature	WTI	Brent
Origin	US inland crude	North Sea waterborne crude (plus WTI Midland)
Main futures exchange	NYMEX (CME Group)	ICE Futures Europe
Delivery	Physical, at Cushing, Oklahoma	Exchange for physical, with cash-settlement option
Quality	Light and sweet (low sulfur)	Light and sweet, slightly heavier on average
Main reference for	US crude pricing	International crude pricing
Standard futures size	1,000 barrels	1,000 barrels

The WTI–Brent spread, the price difference between the two, changes with transport costs, US export flows, storage levels and regional supply disruptions. Brent has usually traded at a premium to WTI in recent years, but the size of that gap varies.

Middle East Benchmarks and the UAE

Crude from the Gulf is priced against its own references. Murban, a light crude produced by ADNOC in Abu Dhabi, has had its own futures contract on ICE Futures Abu Dhabi since 2021. Dubai and Oman prices are widely used for Middle Eastern crude sold to Asia. The UAE is a member of OPEC, so OPEC+ production decisions are closely followed in the region.

For most retail trading platforms, however, the oil instruments available track WTI or Brent. CMS Prime’s commodities trading page lists oil among its energy products.

How Crude Oil Is Traded

There are several ways to gain exposure to oil prices:

• Futures contracts. Standardised exchange contracts for a set quantity, typically 1,000 barrels, with monthly expiries. Traders who do not want delivery close or roll positions before expiry.
• Options on futures. Contracts that give the right, but not the obligation, to buy or sell a futures contract at a set price.
• Exchange-traded products. Funds and notes that track oil prices, often using futures, so their returns can differ from spot prices over time.
• Contracts for difference (CFDs). Agreements with a broker to exchange the difference in price between opening and closing a position. There is no physical delivery, and contract sizes are set by the broker.

Many retail traders use CFDs because position sizes can be smaller than a full futures contract and trading takes place on the same platform as forex. CFDs are leveraged products, and their pricing depends on the broker’s contract terms.

How an Oil CFD Works: An Example

Suppose a broker offers an oil CFD with a contract size of 100 barrels per lot, quoted in US dollars per barrel.

• A trader buys 1 lot at $75.00.
• If the price rises to $76.50, the position shows a gain of $1.50 × 100 = $150.
• If the price falls to $73.00, it shows a loss of $2.00 × 100 = $200.

With a contract size of 1,000 barrels, the same moves would equal $1,500 and $2,000. Contract size, tick value, margin, trading hours and any expiry or rollover rules differ by broker and are listed in each symbol’s specification on MetaTrader 4 and MetaTrader 5.

Oil CFDs based on futures contracts may roll from one contract month to the next. Brokers usually apply a price adjustment when this happens, which can appear as a balance entry or a change in the position’s price.

What Moves Oil Prices?

The US Energy Information Administration (EIA) groups the drivers of crude prices into supply, demand, inventories and financial markets.

Supply: OPEC+ and other producers

OPEC countries produce about 35% of the world’s crude oil, and their exports account for around 50% of internationally traded oil, according to the EIA. OPEC and its partners, known as OPEC+, meet regularly to set production targets. Announcements of cuts or increases can move prices sharply.

Spare capacity, the volume OPEC producers could bring online within 30 days and sustain for 90, is also watched closely. Low spare capacity tends to leave prices more sensitive to disruptions.

Non-OPEC supply matters too, particularly US shale output, which can respond to prices within months.

Demand: economic growth and seasons

Oil demand follows economic activity. Data on manufacturing, transport and industrial output, especially from the United States and China, influences expectations. Seasonal patterns, such as the US summer driving season and winter heating demand, also affect refined products and, through them, crude. CMS Prime’s article on economic indicators that move commodities looks at which releases matter.

Inventories: the weekly EIA report

The EIA’s Weekly Petroleum Status Report shows US crude and product stocks. Summary data is usually released on Wednesdays at 10:30 a.m. Eastern Time, which is 18:30 Gulf Standard Time when New York is on daylight saving time and 19:30 GST in winter. A larger-than-expected build in inventories is often read as a sign of weaker demand or stronger supply, and a draw as the reverse. Release times appear on the CMS Prime economic calendar.

The US dollar

Oil is priced in US dollars. A stronger dollar makes oil more expensive in other currencies, which can weigh on demand, while a weaker dollar can have the opposite effect. The relationship is not constant. CMS Prime’s article on the gold, oil and forex correlation explains how these markets interact.

Geopolitics and disruptions

Conflicts, sanctions, shipping disruptions and outages at major facilities can remove supply quickly or raise concern that they might. Hurricanes in the US Gulf of Mexico can affect production and refining. These events are often unscheduled, which makes them hard to plan around.

Inflation and interest rates

Oil feeds directly into inflation through fuel and transport costs, and central bank decisions affect economic growth and the dollar. CMS Prime covers these links in how central bank decisions influence forex and commodities.

Key Risks of Trading Oil

• High volatility. Oil can move several percent in a single session, especially around OPEC+ decisions, inventory data and geopolitical news.
• Leverage. Losses on leveraged positions can exceed expectations quickly. CMS Prime’s risk disclosure sets out these risks.
• Gaps. Weekend events can cause prices to open far from Friday’s close.
• Contract rollover. Futures-based CFDs can have price adjustments when contracts roll.
• Extreme events. In April 2020, the expiring May WTI futures contract settled below zero, at about −$37.63 per barrel, as storage at Cushing ran short. Such events are rare, but they show how far prices can move.

CMS Prime’s article on commodity trading mistakes covers common pitfalls, such as oversized positions around scheduled data.

Frequently Asked Questions

What is the difference between WTI and Brent? WTI is a US crude benchmark delivered at Cushing, Oklahoma, and traded mainly on NYMEX. Brent is a waterborne benchmark based on North Sea crude and traded mainly on ICE. Brent is the reference for most internationally traded oil, while WTI reflects US market conditions.

Why is Brent usually priced higher than WTI? Brent is waterborne and easier to ship to international buyers, while WTI is priced inland at Cushing and depends on pipeline and export capacity. Transport costs and regional supply conditions create the spread, which changes over time.

What moves crude oil prices the most? The main drivers are supply decisions by OPEC+ and other producers, global demand, inventory levels, the US dollar and geopolitical events. Scheduled releases such as the weekly EIA inventory report and OPEC+ meetings often cause sharp moves.

When is the EIA oil inventory report released in UAE time? The EIA’s Weekly Petroleum Status Report is usually released on Wednesdays at 10:30 a.m. Eastern Time, which is 18:30 GST during US daylight saving time and 19:30 GST in winter. Holiday weeks can shift the schedule.

What is an oil CFD? An oil CFD is a contract with a broker to exchange the difference in the oil price between opening and closing a position. It tracks WTI or Brent prices without physical delivery. Contract size, margin and rollover terms are set by the broker.

How much is a $1 move in oil worth? It depends on the contract size. On a 1,000-barrel futures contract, a $1 move is worth $1,000. On a CFD with 100 barrels per lot, it is worth $100 per lot. The symbol specification on MT4 or MT5 shows the contract size.

Conclusion

Learning how to trade crude oil starts with the two main benchmarks: WTI, priced at Cushing and reflecting US conditions, and Brent, the reference for most international crude. Exposure comes through futures, options, exchange-traded products or CFDs, each with its own contract size, costs and settlement rules. Prices respond to OPEC+ supply policy, non-OPEC production, demand, weekly inventories, the US dollar and geopolitical events, and they can move sharply in a short time. CMS Prime’s commodities page, economic calendar and MT4 and MT5 platforms provide the instrument details and event times needed to follow oil markets.

Risk warning: Trading in financial instruments such as Forex, CFDs, and derivatives involves a high level of risk and may not be suitable for all investors. Past performance is not indicative of future results.

Sources

• ICE — What are the differences between ICE Brent and NYMEX WTI futures?
• U.S. Energy Information Administration — What drives crude oil prices
• U.S. Energy Information Administration — What drives crude oil prices: Supply OPEC
• U.S. Energy Information Administration — Weekly Petroleum Status Report release schedule