Brent–WTI spread
The price difference between Brent and WTI crude, a gauge of US export economics and of the regional supply balance.
The spread is Brent minus WTI. It is usually positive, reflecting transport costs and quality differences, but it can narrow or invert when US inventories are high or export capacity is constrained. A wide spread can make exporting US crude profitable if shipping and fees are low enough.
Traders care because the spread drives export arbitrage and affects refiner margins. A sharp move can signal a change in shipping costs, in export capacity or in regional stock levels. Track the spread alongside freight rates and US export volumes.
Worked example (illustrative numbers, not real data): Brent at 82 and WTI at 79 gives a 3 dollar spread. If the spread widens to 6 dollars and US export costs are 1.5 dollars per barrel, the arbitrage margin is 4.5 dollars per barrel before risk and financing.