U.S. Crude Oil Pricing
U.S. Crude Oil Pricing: June’s average West Texas Intermediate (WTI) crude oil price per barrel increased 12% month on month (m/m) – its largest jump since February. The WTI is up 90% year on year (y/y), coming in at $72.98 / barrel in June 2021 vs. $38.31 / barrel in June 2020.
By comparison, Brent crude rose 9% m/m to $74.78 / barrel in June 2021, and experienced growth of +86% y/y ($40.27 / barrel in June 2020). The WTI and Brent crude oil benchmarks are undergoing similar patterns this month.
Figure 1 charts the monthly average spot prices of WTI and Brent crude oil from 2000 to present. Until the U.S. shale revolution of the 2010’s, the WTI oil benchmark was higher than that of Brent’s. But increased production and supply following the implementation of fracking has driven the price / barrel of the WTI lower than Brent.
At Gerdau, we routinely monitor the price of oil issued by the Energy Information Administration since it has a direct impact on the cost of shipping and freight. These costs, in addition to the data we follow on oil and gas rotary rig counts, have been shown to impact long product sales.