What are US light and Brent crude?
There are the two benchmarks for world oil prices. One is the futures contract – an agreement for future delivery at a specified time, place and price – for US light crude. The contract is widely used as the benchmark for determining crude oil and refined product prices in the US and abroad. Brent crude oil is a North Sea crude widely used to determine crude oil prices in Europe as well as other parts of the world. Together, the light crude oil futures contract and Brent crude are used as the basis for virtually every physical crude oil transaction. Why have oil prices risen? Strong economic growth in the US – which consumes a quarter of the world’s petrol – and Asia, particularly in China, has been putting pressure on prices. World oil demand grew at its strongest pace in 30 years last year. Opec is pumping oil pretty much at full capacity. What about political factors? With oil suppliers at full stretch, any hint of political instability in the Middle East easily unsettles the market
