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WTI goes global
Overview
WTI Midland is now the world’s largest freely traded grade of crude oil by output and volume. In December 2015, the US lifted a 40-year ban that had restricted exports of US crude overseas. Since the ban was lifted, export volumes have soared and US crude now makes its way to markets all over the world.
The meteoric rise of US crude on the global stage has made Permian basin crude WTI Midland the world’s most important grade and has put the US Gulf coast at the epicentre of global crude trade. Houston is the point of greatest optionality for crude oil. From Houston, crude can be refined in the world’s largest refining centre, moved domestically within the world’s largest oil demand hub, and exported to all corners of the globe. Price dictates these options, making the price at Houston the source of all key comparisons.
Light sweet WTI Midland is now firmly at the centre of price discovery for crude oil. It is a key component of Dated Brent and the global swing barrel, and European and Asian buyers are beginning to purchase crude on a WTI Houston basis. This crude has truly emerged as the heartbeat of the global crude system.
A global waterborne crude, underpinned by a liquid pipeline market
In most major markets, crude oil is generally transported by water. But the WTI Houston and Midland markets are different, with oil travelling first by pipeline in small, rateable transactions. The high volume of daily transactions means that there are many points of price discovery throughout the day. Our expert team of crude oil market reporters endeavour to capture it all.
Cargo markets by nature consist of a few, large single trades. But at the US Gulf coast, cargoes are priced at a differential to the pipeline market, so they benefit from the underlying price dynamics of the highly liquid and transparent US pipeline market.
For this reason, understanding the WTI supply chain and the drivers of its price formation is imperative for anyone buying, selling or trading crude oil across the globe.
WTI and Argus, a deeply rooted relationship
For two decades, Argus WTI assessments at Midland and Houston have been the standard physical benchmarks for US crude, as well as the settlement indexes for a robust derivatives market. These prices are assessed as differentials to the Argus WTI formula basis, based on the Nymex light sweet crude futures contract — one of the world’s most actively traded oil futures. They are the clear choice for trading companies seeking to manage WTI positions in the physical and paper markets.
Argus WTI Houston and Argus WTI Midland collectively form the basis of the world’s third-largest crude oil derivatives market, after Nymex light sweet and Ice Brent. The contracts are actively traded over the counter and cleared by oil brokers through exchanges such as CME and Ice.
Our rich, deep and trusted coverage of the US crude oil market is unrivalled. You need Argus to make confident business decisions.
Latest crude oil news
Browse the latest market moving news on the global crude oil industry.
China’s CNOOC gets record gas results from Bohai well
China’s CNOOC gets record gas results from Bohai well
Singapore, 17 July (Argus) — Chinese state-controlled oil firm CNOOC has achieved what it described as record gas production results from a test well at its Longkou 7-1 (LK7-1) oil and gas field in the eastern region of China's Bohai Sea. The LK7-1-1 exploration well could produce almost 1mn m³/d of natural gas and about 210m³/d (1,320 b/d) of crude oil, the company said on 15 July. The former set a record for natural gas tested productivity in the Bohai Sea, according to CNOOC. China produced 123.6bn m³ of natural gas in January-June, up by 6pc from a year earlier, according to the National Bureau of Statistics of China (NBS). The country produced 4.15mn b/d of crude in 2023, NBS data showed. The potential output adds to CNOOC's reserves and production in the Bohai Sea, which stood at 1.97mn b/d of oil equivalent (boe/d) and 599,847 boe/d as of the end of 2023, according to CNOOC. The region represents 29pc of the company's total reserves and approximately 32pc of its production. CNOOC, along with other state-controlled firms like PetroChina and Sinopec, dominates China's domestic oil and gas production. CNOOC has also separately started production at an oilfield offshore China. The Wushi 23-5 oilfield development project — located in the Beibu Gulf of the South China Sea — is expected to produce light crude, and achieve peak production of 18,100 boe/d in 2026. "The project will realise full-process recovery and utilisation of the associated gas through integrated natural gas treatment," the company said on 1 July. CNOOC in November 2023 started production at its Bozhong 19-6 condensate gas field in the Bohai bay. The gas field is currently producing an estimated 37,500 boe/d, exceeding an initial expectation of peak production of about 37,000 boe/d, the company said on 11 July. CNOOC in March 2023 discovered the Bozhong 26-6 field with over 100mn t of oil equivalent reserves, also in the Bohai Sea. By Joey Chan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Tanker owner denies Houthi attack in Med
Tanker owner denies Houthi attack in Med
London, 16 July (Argus) — The owner of a tanker reported attacked today in the Mediterranean Sea has said there was no such incident. Petronav Ship Management said its tanker, Olvia , was not targeted as claimed by Yemen's Houthi militants. An attack in the Mediterranean would be a big step outside the Houthi's region of operations, which is limited to the area in and around the Bab el-Mandeb strait at the southern end of the Red Sea. The Houthis claimed two other attacks today in the Red Sea, on crude tanker Chios Lion and oil product tanker Bentley I . By Ben Winkley and Bob Wigin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
New Libyan firm starts exporting crude
New Libyan firm starts exporting crude
London, 16 July (Argus) — A little known Libyan upstream company has begun exporting crude with its first shipment heading to China, according to sources, official documents and ship-tracking data seen by Argus . Arkenu Oil Company, which describes itself as a private oil and gas development and production firm, exported 1mn bl of Sarir/Mesla blend crude from Libya's Marsa El Hariga oil terminal on 10 July on Suezmax-class tanker Zeus . Shipping agent and port reports list Chinese trading firm Unipec as the vessel's charterer. The tanker's bill of lading lists Libyan state-owned NOC as the sender of the consignment on behalf of Arkenu. Libyan crude sales have historically been the reserve of NOC and a handful of international oil companies that hold equity stakes in production assets in the country, including Italy's Eni, TotalEnergies and Austria's OMV. Turkey-based commodities trader BGN, which does not have any upstream production in Libya, also regularly appears on loading programmes as a seller of the country's crude. A document dated 10 July showed NOC had allocated to Arkenu an unspecified share of production from its subsidiary Agoco's Sarir and Mesla fields, in return for carrying out upstream development work on the fields. The arrangement implies Agoco is paying for Arkenu's services in the form of crude. Arkenu's 1mn bl cargo is worth around $84mn at current market rates, Argus estimates. Arkenu, set up in early 2023 in the eastern city of Benghazi, says it owns modern drilling rigs and has a team of experts "who have held high positions in major oil production and development companies". It is unclear what work Arkenu has carried out for Agoco. Sarir and Mesla accounted for most of Agoco's 279,000 b/d of output in 2023. Libya is politically divided between an internationally recognised administration in the west, which has historically controlled oil revenues, and a rival administration in the east, which is home to around three-quarters of the country's oil production capacity. Agoco is based in the east, and NOC in the west. Libya produces just over 1.2mn b/d of crude. Its oil export revenues were $30.7bn in 2023, according to Opec. Arkenu, NOC and Unipec have been contacted for comment. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Trump taps Vance as running mate for 2024
Trump taps Vance as running mate for 2024
Washington, 15 July (Argus) — Former president Donald Trump has selected US senator JD Vance (R-Ohio) as his vice presidential pick for his 2024 campaign, elevating a former venture capitalist and close ally to become his running mate in the election. Vance, 39, is best known for his bestselling memoir Hillbilly Elegy that documented his upbringing in Middletown, Ohio, and his Appalachian roots. In the run-up to the presidential elections in 2016, Vance said he was "a never Trump guy" and called Trump "reprehensible." But he has since become one of Trump's top supporters and adopted many of his policies on the economy and immigration. Vance voted against providing more military aid to Ukraine and pushed Europe to spend more on defense. Trump said he chose his running mate after "lengthy deliberation and thought," citing Vance's service in the military, his law degree and his business career, which included launching venture capital firm Narya in 2020. Vance will do "everything he can to help me MAKE AMERICA GREAT AGAIN," Trump said today in a social media post. Like Trump, Vance has pushed to increase domestic oil and gas production and criticized government support for electric vehicles. President Joe Biden's energy policies have been "at war" with workers in states that are struggling because of the importance of low-cost energy to manufacturing, Vance said last month in an interview with Fox News. Trump made the announcement about Vance on the first day of the Republican National Convention in Milwaukee, Wisconsin, and just two days after surviving an assassination attempt during a campaign event in Pennsylvania. Earlier today, federal district court judge Aileen Cannon threw out a felony indictment that alleged Trump had mishandled classified government documents after leaving office. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Why Argus WTI?
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Unrivalled methodology
Argus reports the US Gulf coast pipeline market the way it trades, rather than forcing it into a one-size-fits-all methodology. We publish volume-weighted average indexes for each assessed grade and location using reported deals done, and publish the underlying deals themselves. This provides our subscribers with accuracy and convenience, as well as a transparent audit trail.
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An all-in-one view of your data
Hourly snapshots of the WTI Midland and WTI Houston markets can be viewed on the Argus Crude Market Ticker, also accessible on CME Direct. And for the first time, Argus WTI Midland and Houston futures can be traded directly on-screen through CME Direct, including by entities that do not retain a cash market broker.
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Innovation and responsiveness
Argus has reported waterborne cargo prices for WTI Midland for several years on both fob US Gulf coast and delivered-Europe and Asia bases. As the market has developed, so has our approach. In November 2022, we augmented our rolling price for fob Midland WTI by reporting three intramonth periods, to better reflect market structure and the way cargoes are traded.
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An expert reporting team
The Argus WTI Houston and Midland assessments are underpinned by the expertise of our Americas editorial team. We demystifying these complex markets through independent and transparent pricing, built on the strength of our relationships with the market. We have been surveying these pipeline markets for decades, meaning we understand the vital connections and nuances that exist.
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Our commentary on the rise of WTI
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