Market Analysis7 min read
Oil Trading: WTI vs Brent and What Moves Crude Prices
Oil CFDs (WTI and Brent) are the most traded commodity after gold. Learn what drives oil prices and how to trade them. WTI drivers, OPEC days and inventories.
WTI vs Brent
- WTI (West Texas Intermediate): US benchmark, lighter/sweeter crude, traded on NYMEX
- Brent: International benchmark, North Sea production, traded on ICE
- WTI typically trades $2-5 below Brent due to transportation and quality differences
- Both are available as CFDs on most brokers
What Moves Oil?
- OPEC decisions: Production cuts or increases move oil significantly
- US shale production: US is now the world's largest oil producer
- Global demand: Economic growth = more oil demand
- Inventory data: EIA weekly crude oil inventory report (Wednesdays)
- Geopolitics: Middle East tensions disrupt supply expectations
Trading Oil CFDs
Oil is more volatile than forex — daily moves of 2-5% are common. Use wider stops and smaller position sizes. Key trading times: OPEC meetings (monthly), EIA inventory report (Wednesdays 16:30 SAST), and major geopolitical events. Oil tends to trend strongly — trend following works well.
Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70-80% of retail investor accounts lose money when trading CFDs. Backtesting does not guarantee future results. Always consider whether you can afford the potential loss of your capital.