Energy

XBR/USD: Brent Crude Oil

A CFD on Brent crude, the benchmark used to price most of the world’s internationally traded oil.

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What happens next

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Demo: choose your virtual funds and open the terminal. Live: upload your identity documents; an account is opened once they are approved. Live trading is not yet connected.

Market DNA

Below, XBR/USD is taken apart: its class, its contract, its hours and what is connected to it. Structure, not a signal.

Market DNA

What XBR/USD is made of.

Its class, its contract, the hours it lives in and the institutions, releases and ideas connected to it.

This is structure. It is not a score and it is not a signal: it tells you what the instrument is, not what it will do.

Asset class: Energy
Contract: CFD, quoted in US dollars per barrel
Platform symbol: XBRUSD
Typical sessions: Nearly 24 hours a day on weekdays, with a daily maintenance break.See the sessions on the World Market Clock
Economic events: Gross Domestic Product
Concepts: Inflation

Trading conditions

As published by GIO4X.

Spread from: 0.03 USDminimum, widens with market conditions
Leverage: 1:100depends on instrument and jurisdiction
Minimum lot: 0.1
Contract: CFD, quoted in US dollars per barrel
Platform symbol: XBRUSD

IndicativeSource: GIO4XIndicative trading conditions published by GIO4X. Not a live quote; actual spreads and requirements vary with market conditions and account type.

All trading conditions

On the 777 Raptor demo

Demo symbol UKOIL. How the demo terminal is set up, not GIO4X’s specification for live trading, which is not yet published.

Contract size, 1.00 lot: 1,000 units of the underlying; Sizes from 0.01 to 100 lots, in steps of 0.01.
A move of 1.00 in the price, on 1.00 lot: 1,000 USD; 1.00 × the contract size. A pip is a convention of currency pairs; this instrument has none.
Margin per 1.00 lot at 1:100: not available: reading the simulated price; contract size × price ÷ leverage
Margin per 1.00 lot at 1:500: not available: reading the simulated price; 1:500 is the “up to” figure the account types publish: a ceiling, not what an instrument or a client is given

Contract data read from the demo terminal. Demo prices are simulated by GIO4X’s own engine; they are not market prices. Swap rates are not published.

Third-party chart

XBR/USD on a daily chart

The chart is supplied by TradingView and stays unloaded until you ask for it. Loading it connects your browser to TradingView’s servers.

Third partyChart by TradingViewThird-party data for Brent Crude Oil, not supplied or verified by GIO4X and not a GIO4X price. Symbol TVC:UKOIL, UTC.

Before you trade it

Work the numbers. Know the words.

Tools

All tools

Glossary

Full glossary

In depth

What is particular to Brent Crude Oil.

Brent is the price of crude oil loaded onto ships in the North Sea, and by extension the reference for most oil traded between countries. Because it is seaborne it can go wherever the price is best, which makes it a measure of the world market where WTI is a measure of an inland American one. Its futures settle in cash, not in barrels.

General education about the underlying market. It states no current price or rate, makes no forecast and is not advice. What GIO4X offers on this instrument is in the trading conditions on this page, not here.

What moves it

Decisions by the producer group: The Organization of the Petroleum Exporting Countries and the producers allied with it agree production targets for their members. An agreed cut removes supply the market had expected and an increase adds it, and the price responds to the difference between what was expected and what was announced. Members do not always produce what they agreed, so compliance is followed as closely as the targets.
Shipping routes and conflict: Much of the world’s traded crude passes through a few narrow sea lanes, the Strait of Hormuz above all. A threat to tankers there, or sanctions that take a producer’s exports off the market, raises the price of oil that can still be delivered. The move often fades if supply is not in fact interrupted.
World demand: Demand follows economic activity: freight, flying, driving and petrochemicals. Growth figures and factory surveys from the largest importing countries, China and India among them, change expectations of demand. Demand falls far less often than supply changes, but when it does, as in the spring of 2020, the effect is large.
The United States dollar: Oil is priced in dollars. When the dollar rises, oil becomes dearer for buyers who earn other currencies, which tends to weigh on demand and on the dollar price. The link is a tendency and has run the other way when both rose together on a supply shock.
Refining margins: Crude is worth what refiners can earn by turning it into petrol, diesel and jet fuel. When the margin between product prices and crude is wide, refiners buy more crude; when it is thin, or when refineries shut for maintenance, they buy less.

Mechanics

How it is quoted and built.

A benchmark made of several crudes: Output from the original Brent field has dwindled, so the benchmark has been widened over the years. The physical price, known as Dated Brent and assessed by a price-reporting agency, now draws on several North Sea grades and, since 2023, on a grade of American crude delivered to Rotterdam. The name has outlived the field.
Three linked prices: There is the price of physical cargoes loading in the coming weeks, a forward market in cargoes for later months, and the futures contract. The futures price most people see is tied to the physical market through the other two. In a tight market the physical price can stand well above the futures.
Cash settlement: The Brent futures contract, traded on a London exchange, is settled in cash against an index of the physical forward market, with physical delivery possible only by a separate arrangement between the parties. Nobody is obliged to receive oil at expiry. This is the main structural difference from WTI.
Quoted in dollars per barrel: The price is for one barrel, in United States dollars, and each futures contract covers a thousand barrels. Brent is a light, low-sulphur crude; heavier and more sulphurous crudes sell at a discount to it, and that discount varies.

Not the same thing

The market itself, and a contract on its price.

Physical oil: A barrel of crude has to be stored, insured and shipped, and is of use only to a refinery. Almost nobody outside the oil industry owns it. Every financial exposure to oil is therefore to a contract, and the contract’s terms matter as much as the price of oil.
A futures contract: A future fixes a price for a named month. There is a different price for each month, and the contract nearest expiry is the one usually quoted. Holding an oil exposure over time means selling each contract before it expires and buying a later one.
A CFD: A CFD on Brent exchanges the change in a price that a provider derives from the futures. Some are based on a named futures month and expire with it; others are quoted as a continuous price with an adjustment or a financing charge that reflects the curve. Either way the holder’s result includes the shape of the curve, and the provider is the counterparty.

Over time

Events in the life of the contract.

Expiry: Each monthly Brent contract stops trading well before the month it is named for, earlier than the WTI contract for the same month. A “front month” price in the news therefore refers to oil for delivery some way ahead. Volume moves to the next contract in the weeks before expiry.
Contango and backwardation: When later months are priced above nearer ones the curve is in contango, which usually reflects ample supply and the cost of storing oil. When nearer months are priced above later ones it is in backwardation, which usually reflects a shortage of oil available now. The curve can change from one to the other within weeks.
What rolling does: A position rolled in contango sells the cheaper expiring contract and buys a dearer one, and if the spot price then stays where it was, the new contract loses value as it approaches expiry. In backwardation the opposite holds. The headline price can be unchanged over a period in which a rolled position has gained or lost a meaningful amount.
Changes to the benchmark: The grades that make up the benchmark are changed from time to time by the price-reporting agency and the exchange, after consultation, as North Sea output declines. Such changes are announced far ahead and alter what the price represents without any break in the quoted series.

These describe how such events work in general. How GIO4X treats them on its own contract (adjustments, rollover dates, suspensions) is a trading condition and is not yet published.

Timetable and sources

What is scheduled, and where the facts come from.

Worth knowing the timetable of

Ministerial meetings of the Organization of the Petroleum Exporting Countries and its allied producers
The International Energy Agency’s monthly Oil Market Report
OPEC’s Monthly Oil Market Report
The Energy Information Administration’s Weekly Petroleum Status Report
The monthly expiry of the front Brent futures contract
Spring and autumn refinery maintenance seasons

Named, never dated: dates move. The Economic Events page explains the main releases.

Primary sources

ICE Futures Europe: Brent Crude Futures contract specification
S&P Global Commodity Insights (Platts): methodology and specifications guide for crude oil, including Dated Brent
International Energy Agency: Oil Market Report
Organization of the Petroleum Exporting Countries: Monthly Oil Market Report
U.S. Energy Information Administration: Short-Term Energy Outlook

Named by publisher and series, so each can be found from the publisher itself. GIO4X has no connection with them.

What would a trade in it cost?

The cost of a trade is the spread, any commission, and financing for each night it is held. The Cost Lab works the three out for a day trade, an overnight position and a longer hold, from figures you enter. A complete total also needs the swap rates, which are not yet published; the Lab shows which input is missing instead of a total that only looks complete.

Work it out in the Cost Lab

The risk, in ordinary type.

Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose.

XBR/USD is traded on margin. Educational information, not investment advice or a recommendation to trade.

Risk disclosure

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