Oil generally does not have a very sunny image. But even though we might want to use less oil, we still need it for a lot of stuff. That’s why there’s still a lot of demand for the ‘black gold’, and prices are often rising steadily. This also makes oil one of the most important raw materials in the world – if not the most important one. Because oil is then also a product that cannot be mined forever, the price only becomes worth it again. Oil reserves are running out, and although oil prices will not continue to rise forever, there is no reason to panic in the medium term. Apart from times of crisis, the price is reasonably stable on this website about C-TradeAlert.DE
Main reasons to invest in oil:
Very important raw material
There is always demand for oil.
It is a product with a maximum reserve that is running out. That creates scarcity and even more demand.
The price has done reasonably well in recent years.
There are many different products to choose from.
With oil you can also opt for an ETF, or Exchange Traded Fund. This is a so-called ‘tracker’. A share that follows the price of oil, without actually investing in the product itself. The oil ETFs, like all other shares, are simply traded on the market. An ETF focused on oil can be basically anything. It can be a collection of several oil producers, but also oil companies that have put in one ETF. It can also simply be a reflection of oil products, such as the ETFs shown below on this website about el mejores forex brokers en 2021.
ETFS WTI CRUDE OIL
The West Texas Intermediate is an ETF that follows the price of Crude Oil. WTI is also known as Texas Sweet Light oil, and is an important oil ETF that you often see pass by at trade fairs. The spot and future prices of WTI Crude Oil are used as one of the benchmarks within oil prices. By the way, this is not just about oil from Texas, but about all oil that meets specifications that make it ‘light sweet’. Crude Oil is also seen as American oil.
ETFS BRENT OIL SEC
Brent oil is an ETF named after the oil field owned by Shell. This oil field is located off the English coast in the North Sea. This oil is of a certain quality and any oil that meets this quality may use the name Brent Oil and be traded on the market under the same name. Brent Oil is also known as European Oil.
Small differences, with exceptions
Because Brent Oil and Crude Oil are two huge ETFs, you will usually see very little difference between them on the market. However, because of the origin of the oil – mainly Europe/Middle East and the United States – sometimes international differences can be seen. This is mainly due to political decisions, for example import or export rules from the US.