DUBAI CRUDE Meaning and
Definition
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Dubai Crude refers to a benchmark grade of crude oil that is regularly traded in Asian markets, particularly in the Middle East. It is categorized as a medium-heavy sour crude oil, characterized by its high sulfur content and relatively low API gravity. The term "Dubai" is derived from the oil field in Dubai, United Arab Emirates, where this grade of crude oil originates.
With an API gravity around 31-32 degrees and sulfur content exceeding 2%, Dubai Crude is considered a heavier and sourer crude compared to other benchmark grades such as Brent or West Texas Intermediate (WTI). The higher sulfur content makes it more difficult to refine, requiring specialized equipment and refining processes.
Dubai Crude is widely used as a pricing benchmark for crude oil in the Asian market, particularly for oil exports from the Middle East. It serves as a reference point for pricing various regional oil blends, derivatives, and futures contracts. The Dubai Mercantile Exchange (DME) also utilizes Dubai Crude as the underlying commodity for its oil futures contracts.
As a key indicator of market sentiment and price fluctuations in Asia, Dubai Crude plays a vital role in determining the value of crude oil across the region. Its significance lies in its representation of the pricing dynamics and supply-demand balance in the Middle East and Asian oil markets.
Etymology of DUBAI CRUDE
The term "Dubai Crude" originates from the city of Dubai in the United Arab Emirates (UAE), which is a major hub for the oil industry. The crude oil produced in this region is known as Dubai Crude or Dubai Fateh. The word "Dubai" refers to the location where this type of crude oil is produced, while "crude" refers to the unrefined, raw form of petroleum. The term is widely used in the oil and gas industry to specify the specific grade of oil produced in Dubai and traded in the global market.
