The shale revolution in the United States has had a profound impact on global oil pricing, with U.S. crude now dominating the Dated Brent benchmark, the world’s most traded commodity pricing index.
In the past year, since price reporting service S&P Global’s Platts added U.S. WTI Midland crude from the Texas shale fields to the Dated Brent benchmark, the American grade has set the price more than half the time. This reflects the growing importance of U.S. oil exports in global markets.
Previously, the Dated Brent benchmark had only included North Sea crude, but the supply from this region has declined over time. Meanwhile, U.S. crude exports to Europe have surged as refiners sought alternatives to Russian imports, which the European Union banned in response to Moscow’s invasion of Ukraine.
Platts uses the cheapest among WTI Midland and five grades of North Sea oil to set the Dated Brent benchmark, which is viewed as a bellwether for the health of the global oil market. The inclusion of WTI Midland reflects the shale revolution that has transformed the U.S. from a top importer to a major exporter after Washington ended a 40-year ban on foreign oil shipments.
The dominance of U.S. crude in the Dated Brent pricing underscores the profound impact of the shale boom, which has made the U.S. the world’s top oil producer. This shift in the global oil landscape has significant implications for the dynamics of the international energy market.