OPEC Basket

Overview

The OPEC Basket (also called the OPEC Reference Basket or ORB) is a weighted average of crude oil prices reported by member countries of the Organization of the Petroleum Exporting Countries (OPEC). It serves as a reference benchmark for tracking OPEC members’ collective oil revenue and for setting organizational price targets, but it is not a physical grade of crude that can be bought or sold.

How it’s calculated

The ORB is calculated by taking a weighted average of specific crude blends produced by OPEC members. Weights reflect the relative importance or production volumes of each participating crude. Because it aggregates many different qualities, the ORB smooths individual price movements and provides a single indicator of OPEC-member pricing.

Typical components

The basket historically includes a range of crude types from OPEC members, for example:
* Saharan Blend (Algeria)
* Girassol (Angola)
* Djeno (Congo)
* Zafiro (Equatorial Guinea)
* Rabi Light (Gabon)
* Iran Heavy
* Basra Light (Iraq)
* Kuwait Export
* Es Sider (Libya)
* Bonny Light (Nigeria)
* Arab Light (Saudi Arabia)
* Murban (UAE)
* Merey (Venezuela)

(Composition and weights can change with membership and reporting.)

Why the ORB often trades lower than other benchmarks

Many OPEC crudes include heavier or higher-sulfur grades that are more costly to refine than lighter, sweeter crudes. Because of this mix, the OPEC Basket typically trades below light sweet benchmarks such as Brent and West Texas Intermediate (WTI), which are higher quality and command premium prices.

Uses and significance

• Benchmark for OPEC policy: The ORB is the primary price metric OPEC uses when discussing targets, quotas, and production strategy.
• Market indicator: Traders, analysts, and governments monitor the ORB as a gauge of price trends among major oil exporters.
• Macro relevance: Oil prices influence transportation, manufacturing, agriculture and many other sectors; the ORB therefore carries significance for global inflation and economic activity.

Comparison with other benchmarks

• Brent (North Sea) and WTI (U.S.) are among the most widely traded international benchmarks. They tend to be lighter and sweeter and generally trade above the ORB.
• The ORB reflects a broader, lower-quality mix and is most useful for assessing OPEC members’ combined position rather than refinery sourcing decisions.

Limitations and criticism

• Not purchasable: The ORB is an index, not a distinct cargo—refineries and traders buy specific crude grades, not the basket.
• Less useful for refiners: Because refiners evaluate individual crude specifications (API gravity, sulfur content, contaminants), the average basket provides limited operational guidance.
• Averaging effects: A weighted average can mask large price moves in individual member crudes.

Example

As an illustration of its behavior over time, the ORB has shown meaningful year-over-year swings—reflecting both global demand shifts and OPEC production decisions.

Key takeaways

• The OPEC Basket is a weighted average of member-country crude prices and serves as OPEC’s reference benchmark.
• It generally trades below lighter international benchmarks because it includes heavier, higher-sulfur crudes.
• Its main role is policy and market signaling for OPEC; it is not a physical crude grade for purchase and has limited use for refinery procurement decisions.