West Texas Intermediate (WTI)
Definition - What does West Texas Intermediate (WTI) mean?
West Texas Intermediate, most commonly abbreviated as WTI, is crude oil that is produced from various states as well as offshore regions of Texas and Mexico. It is one the grades of crude oil which are traded in the New York Mercantile Exchange (NYMEX). It is also used as a benchmark or marker crude oil for pricing other varieties of crude oil imported from other countries into the boundaries of the United States.
Petropedia explains West Texas Intermediate (WTI)
West Texas Intermediate is considered to be the finest crude oil in terms of its light and sweet nature. Here, the word “Light” means that if WTI crude oil is processed in a refinery, it will yield large amounts of highly valuable refined petroleum products that will yield maximum profits or higher gross refinery margins than any other crude oil. The word “Sweet” refers to the very low amount of sulfur content. It is one of the strongest crude oil on the global crude trading index New York Mercantile Exchange (NYMEX) and based on its price, other crude oil from rest of the world are priced. It acts as a marker crude or benchmark crude for pricing other crude oil varieties. The API gravity for this crude oil is 40 degrees and above, and sulfur content is up to 0.24%. A point to be noted is that WTI price is used as a trading benchmark for other grades of oil produced and traded in the US only. For crude oil trading and pricing of crude oil produced from other countries in rest of the world, various crude oils such as Brent crude and Dubai Fateh are considered as benchmark crudes.