The many shades of crude oil – graphical relationships

WTI and Brent

Scatter plot – Brent and WTI

  • Form: Linear
  • Strength: Very clear fit of data to a non-horizontal straight line. High concentration of points around the line of best fit indicates strong relationship.
  • Direction: Positive incline from left to right
  • Outliers: No significant deviations.

Brent and Fuel Oil

Scatter plot – Brent and Fuel Oil

  • Form: Linear
  • Strength: Clear fit of data to a non-horizontal straight line. High concentration of points around the line of best fit indicates strong relationship.
  • Direction: Positive incline from left to right
  • Outliers: No significant deviations.

 

Brent and Natural Gas

Scatter plot – Brent and Natural Gas

  • Form: Linear
  • Strength: A relatively clear fit of data to a non-horizontal straight line. Concentration of points around the line of best fit indicates a high correlation however there areas in the plot showing that the data points are more widely spread out as compared to the commodities discussed earlier.
  • Direction: Positive incline from left to right
  • Outliers: No significant deviations.

 

Brent and Corn Oil

Scatter plot – Brent and Corn Oil

  • Form: Linear
  • Strength: The non-horizontal line of best fit indicates that a linear relationship exists between the two commodities. There is a greater dispersion of points at higher prices.
  • Direction: A positive incline.
  • Outliers: No significant deviations.

 

Brent and Soybean Oil

Scatter plot – Brent and Soybean Oil

  • Form: Linear
  • Strength: The non-horizontal line of best fit indicates that a linear relationship exists between the two commodities. The concentration of data points around the line of best fit suggests a high correlation.
  • Direction: A positive incline.
  • Outliers: No significant deviations.

 

Brent and Palm Oil

Scatter plot – Brent and Palm Oil

  • Form: Linear
  • Strength: The non-horizontal line of best fit indicates that a linear relationship exists between the two commodities. The concentration of data points around the line of best fit suggests a high correlation
  • Direction: A positive incline.
  • Outliers: No significant deviations.