• Home
  • Pro
  • Partners
  • Help and support
  • English
  • 简体中文
  • 繁体中文
  • ไทย
  • Tiếng Việt
  • Español
  • Português
  • لغة عربية
Pepperstone logo
Pepperstone logo
  • Ways to trade
    • Trading accounts

      Choose from two account types depending on your strategy

    • Premium clients

      Exclusive rewards and bespoke benefits for high-vol traders

    • Pricing

      Discover our tight spreads, plus all other possble fees

    • Professional
    • Active trader program
    • Refer a friend
    • Trading hours
    • 24-hour trading
    • Maintenance
    • Risk management
  • Markets
    • Forex CFDs

      Get great rates on majors like EUR/USD, plus minors and exotics

    • Commodity CFDs

      Trade on metals, energies and softs, with spreads from 2 cents on oil

    • Cryptocurrency CFDs

      Speculate on Bitcoin, Ether and more, with a trusted broker

    • Shares CFDs
    • ETF CFDs
    • Index CFDs
    • Currency Index CFD
    • Dividends for index CFDs
    • Dividends for share CFDs
    • CFD forwards
  • Trading platforms
    • TradingView

      Trade through the world-famous supercharts with great pricing

    • MetaTrader 5

      Explore the apex in trading automation with our execution tech

    • The Pepperstone platform
    • MetaTrader 4
    • CopyTrading
    • cTrader
    • Trading tools
  • Market analysis
    • Navigating markets

      Latest news and analysis from our experts

    • The Daily Fix

      Your regular round-up of key events

    • Meet the analysts

      Our global team giving your trading the edge

  • About us
    • Who we are

      Pepperstone was born from the dream of making trading better

    • Company news
    • Company awards
    • Protecting clients online
    • Trading accounts

      Choose from two account types depending on your strategy

    • Premium clients

      Exclusive rewards and bespoke benefits for high-vol traders

    • Pricing

      Discover our tight spreads, plus all other possble fees

    • Professional
    • Active trader program
    • Refer a friend
    • Trading hours
    • 24-hour trading
    • Maintenance
    • Risk management
    • Forex CFDs

      Get great rates on majors like EUR/USD, plus minors and exotics

    • Commodity CFDs

      Trade on metals, energies and softs, with spreads from 2 cents on oil

    • Cryptocurrency CFDs

      Speculate on Bitcoin, Ether and more, with a trusted broker

    • Shares CFDs
    • ETF CFDs
    • Index CFDs
    • Currency Index CFD
    • Dividends for index CFDs
    • Dividends for share CFDs
    • CFD forwards
    • TradingView

      Trade through the world-famous supercharts with great pricing

    • MetaTrader 5

      Explore the apex in trading automation with our execution tech

    • The Pepperstone platform
    • MetaTrader 4
    • CopyTrading
    • cTrader
    • Trading tools
    • Navigating markets

      Latest news and analysis from our experts

    • The Daily Fix

      Your regular round-up of key events

    • Meet the analysts

      Our global team giving your trading the edge

    • Who we are

      Pepperstone was born from the dream of making trading better

    • Company news
    • Company awards
    • Protecting clients online
Commodities

Commodities - All About Energy Products

Jul 14, 2023
Share
As the macroeconomic landscape continues to evolve, and fears of an upcoming global recession mount, energy products are attracting increasing attention, as traders look for ways in which they can capitalise on shifts in sentiment and changes to the economic backdrop.

Brent Crude

Brent is one of the two major global oil price benchmarks, referencing a blend of prices from four major North Sea oilfields – Brent, Forties, Oseberg and Ekofisk (BFOE). As a sweet and light crude, Brent is easily refined into diesel and gasoline, while also being simple to transport via a vast network of undersea pipelines.

As with the other crude benchmark, WTI, Brent is highly influenced by global economic performance, with oil demand unsurprisingly being incredibly cyclical in nature, and economic data from sizeable oil consumers such as China often wielding significant influence over prices. Furthermore, crude can be significantly influenced by geopolitical events, particularly in major oil producing nations, as well as the actions of the OPEC+ cartel – typically, output cuts support prices, while output increases apply pressure.

OPEC+ cuts have been a significant theme YTD, with two ‘surprise’ output cuts having been announced in an attempt to put a floor under prices. While this has had the desired effect, with $67.50bbl having established itself as solid support, we are yet to see a sustained rally, besides the recent lurch higher as a function of the softening greenback. More prolonged gains, if they were to occur, are likely to require a concrete rise in demand, something that may be unlikely if the current manufacturing slowdown were to deepen.

Preview

WTI Crude

While the drivers of WTI crude, and future outlook, are almost identical to those of Brent, there are some important differences in the underlying product behind the contract.

Geography is one, with WTI referencing a light, sweet crude both traded and delivered at Cushing, Oklahoma. In contrast to Brent, there are no geographical restrictions on the fields from which WTI must be produced, so long as the crude produced meets the requirements of the contract. Despite this, in a similar way to Brent, WTI is a high quality crude which is also easy to refine into various distillate products.

Nevertheless, WTI typically trades at a discount to Brent, at least since the shale boom in the early years of the last decade, largely due to a surplus in supply of the former. This surplus, coupled with the drying up of demand due to global lockdowns, and full storage at Cushing, contributed to the May 2020 WTI closing in negative territory, for the first time on record.

Preview

Natural Gas

Despite the ongoing global focus on climate change, natural gas remains a highly used commodity and one which is integral to the economy, with a variety of uses ranging from industrial manufacturing processes, through to electricity generation.

Typically, the single biggest factor impacting Nat Gas prices is the temperature, with demand tightly correlated with falling temperatures in winter as heating usage increases, and with rising temperatures in summer due to its use in powering air conditioning systems. Of course, hedging flows will also impact price as institutional players seek to reduce the impact of the aforementioned volatility, while geopolitical events – as with most commodities – also play a significant role, particularly in the context of Russia’s ongoing war in Ukraine.

As for markets currently, despite typically being one of the most volatile tradeable commodities, prices have settled into a $2.00 - $2.50 range for much of this year, with a significant degree of geopolitical risk premium having been priced out as war in Ukraine continues, and since alternative supplies (e.g., LNG from the Middle East) were sourced, allaying concerns about a global gas shortage.

Preview

Gasoline

RBOB Gasoline (Reformulated Blendstock for Oxygenate Blending) is one of the most important distillates of crude oil, being used in millions of vehicles worldwide, though the ongoing transition away from internal combustion engines may reduce RBOB demand as time goes on.

Nevertheless, RBOB remains a key global commodity, and one which is primarily influenced by the same factors as both blends of crude mentioned above. That said, there are some idiosyncratic influences on the contract, namely weather in the Gulf of Mexico – an area home to many US oil refineries which produce gasoline – in addition to seasonality, with ‘driving season’, the period between Memorial Day and Labor Day, often providing support to prices.

Preview

The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research we will not seek to take any advantage before providing it to our clients.

Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.

Other sites

  • The Trade Off
  • Partners
  • Group
  • Careers

Ways to trade

  • Pricing
  • Trading accounts
  • Pro
  • Active Trader program
  • Refer a friend
  • Trading hours

Platforms

  • Trading Platforms
  • Trading tools

Markets & Symbols

  • Forex
  • Shares
  • ETFs
  • Indices
  • Commodities
  • Currency indices
  • Cryptocurrencies
  • CFD Forwards

Analysis

  • Navigating Markets
  • The Daily Fix
  • Meet the analysts

Learn to Trade

  • Trading guides
  • Videos
  • Webinars
Pepperstone logo
support@pepperstone.com
1786 628 1209
#1 Pineapple House,
Old Fort Bay, Nassau,
New Providence, The Bahamas
  • Legal documents
  • Privacy policy
  • Website terms and conditions
  • Cookie policy
  • Sitemap

© 2025 Pepperstone Markets Limited | Company registration number 177174 B | SIA-F217

Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

81.1% of retail investor accounts lose money when trading CFDs with this provider.

You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

You don't own or have rights in the underlying assets. Past performance is no indication of future performance and tax laws are subject to change. The information on this website is general in nature and doesn't take into account your or your client's personal objectives, financial circumstances, or needs. Please read our RDN and other legal documents and ensure you fully understand the risks before you make any trading decisions. We encourage you to seek independent advice.

Pepperstone Markets Limited is located at

#1 Pineapple House, Old Fort Bay, Nassau, New Providence, The Bahamas

and is licensed and regulated by The Securities Commission of The Bahamas,( SIA-F217).

The information on this site and the products and services offered are not intended for distribution to any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.