The terms used most often across crude and refined product desks.
Benchmarks and differentials
Brent, WTI and Dubai are the principal crude benchmarks. Physical grades trade at a differential to a benchmark reflecting quality and location.
Refined products price against regional assessments such as Northwest Europe barges, Mediterranean cargoes, Singapore quotes and US Gulf pipeline values.
Market structure
Contango — forward prices above prompt, which rewards storage.
Backwardation — prompt above forward, which rewards prompt supply and discourages inventory.
Crack spread — the margin between crude cost and product value, the core refining economics indicator.
Trade flows
Arbitrage — moving a cargo between regions when the price difference exceeds freight and financing costs.
Ton-mile demand — cargo volume multiplied by distance, the key driver of tanker freight.
Floating storage — cargo held on vessels, usually economic only in deep contango.
Execution
Laycan — the agreed loading window. Laytime and demurrage govern time allowed in port and compensation for delay.
Worldscale — the freight rate index used for tanker voyage charters.
Pricing period — the days over which the contract price is averaged, often around the bill of lading date.