Brent Crude Oil Price:  Understanding the Basics  

Brent Crude Oil Price:  Understanding the Basics  

If you are like most people, until about five years ago you never thought about the price of oil much.  We all took our oil supply and the associated prices for granted, and most of us never even thought about the oil that it takes to make the fuel for our vehicles.  The fact of the matter is that today we are all painfully aware of how oil prices as well as supply and demand can affect our lives.  This has people looking at the oil prices of different types of crude, such as Brent crude oil price.

Not sure what Brent crude is or how it impacts oil costs overall?  Brent crude is the largest of the major classifications of oil.  Brent crude is found in the North Sea and is extracted by a Brent crude oil maker known by different names such as Brent Blend, London Brent, and Brent petroleum.  The reason that Brent crude prices are so important is that it is used to price two thirds of the internationally traded crude oil supplies.

Curious as to how the Brent crude oil price is determined?  Generally, the typical price different per barrel is between +/- 3USD/bbl compared to the WTI and OPEC Basket.  The reason for the price spread is varied ranging from supply and demand and physical variations.  Additionally, the exhaustion of the North Sea oil field supplies is an explanation for increased prices in Brent Crude oil.  Watching the patterns of Brent Crude oil prices will show that times where crude oil is in the highest demand is when prices will increase

The Brent crude oil price is very complicated and changing all the time.  Like all other oil prices, the cost of a barrel rises and falls depending on supply and demand.  Supply and demand is one of the largest factors in oil prices.  Luckily, Brent crude oil is extracted and delivered to refineries all 12 months of the year.

This allows for drilling to be continuous, so usually there is not as much of a variance as you might expect. Of course, the more Brent crude we’re using the lower the supply dips, and the higher the prices will climb.  Many expect for the Brent Crude oil prices to climb in the later half of 2010 continuing into the early part of 2011, although these are early predictions.