Crude oil is a liquid in the Earth, and it is made of hydrocarbons, organic compounds, and tiny amounts of metal. There are many types of crude produced around the world, and the quality of each is reflected in the value. One of its quality characteristics is the sulfur content, which can be defined as sweet or sour, and density ranges from heavy to light. If crudes are light and sweet, they are more expensive as opposed to energy products such as diesel and gasoline. There is a high demand for these grades since they can be processed with refineries requiring less energy.
Many types of crude oil differ in their consistency and density, depending on how and where it is extracted. There are over 160 types of crude oil traded on the market, but Brent Crude and WTI serve the most as the oil benchmarks in the global markets.
The Organization of the Petroleum Exporting Countries (OPEC) is a cartel of 14 major oil-producing nations seeking to manage the supply of the commodity to control its prices. When there is a meeting for whether to boost or cut production, it can impact current and future prices directly, and oil watchers globally closely follow the announcements. Another important factor affecting the prices is the major crude reports from the US inventory number as higher inventories will mean less demand from the international markets and will pressure the prices lower. Political factors or wars in oil-producing nations are a major issue in the oil markets, and natural disasters such as hurricanes that affect major oil infrastructures.
Oil prices extended losses on the 10th of February 2022 and were heading for a weekly fall as the prospect of increased Iranian oil exports eclipsed fears of potential supply disruption resulting from the Russia-Ukraine crisis.
