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Q43 (IAS/2020) Economy › External Sector & Trade › Global trade patterns Official Key

The term 'West Texas Intermediate', sometimes found in news, refers to a grade of

Result
Your answer: —  Âˇ  Correct: A
Explanation

The correct answer is Option 1: Crude oil.

West Texas Intermediate (WTI) is a specific grade of crude oil and one of the main global benchmarks for oil pricing, alongside Brent Crude and Dubai Crude. It is extracted primarily from oil fields in the United States, specifically in Texas, Louisiana, and North Dakota.

WTI is characterized as "sweet" and "light":

  • Sweet: It contains low sulfur content (less than 0.5%), making it easier and cheaper to refine.
  • Light: It has a low density (high API gravity), which yields a high quantity of high-value products like gasoline and diesel during refining.

Options 2, 3, and 4 are incorrect because WTI is exclusively associated with the petroleum industry. While bullion refers to precious metals and rare earth elements/uranium are minerals, none use WTI as a classification or pricing standard.

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Don’t just practise – reverse-engineer the question. This panel shows where this PYQ came from (books / web), how the examiner broke it into hidden statements, and which nearby micro-concepts you were supposed to learn from it. Treat it like an autopsy of the question: what might have triggered it, which exact lines in the book matter, and what linked ideas you should carry forward to future questions.
Q. The term 'West Texas Intermediate', sometimes found in news, refers to a grade of [A] Crude oil [B] Bullion [C] Rare earth elements […
At a glance
Origin: Mostly Current Affairs Fairness: Low / Borderline fairness Books / CA: 0/10 ¡ 10/10
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This is a classic 'Market Literacy' question derived from the Business page of newspapers. While not in static geography books, 'WTI' and 'Brent' are the two most cited terms in global energy news. The question was triggered by the historic April 2020 event where WTI crude prices turned negative due to storage constraints.

How this question is built

This question can be broken into the following sub-statements. Tap a statement sentence to jump into its detailed analysis.

Statement 1
Does "West Texas Intermediate" refer to a grade of crude oil?
Origin: Web / Current Affairs Fairness: CA heavy Web-answerable

Web source
Presence: 5/5
"West Texas Intermediate (WTI) is a grade or mix of crude oil; the term is also used to refer to the spot price, the futures"
Why this source?
  • Directly identifies West Texas Intermediate (WTI) as a grade or mix of crude oil.
  • Explicit wording confirms the term refers to a crude oil grade (and related market prices).
Web source
Presence: 5/5
"WTI is a grade of crude oil also known as “Texas light sweet.”"
Why this source?
  • States WTI is a grade of crude oil and gives its common name 'Texas light sweet'.
  • Provides specific properties (API gravity, sulfur content) that characterize it as a particular crude grade.

Geography of India ,Majid Husain, (McGrawHill 9th ed.) > Chapter 8: Energy Resources > Oil Refineries of India > p. 15
Strength: 4/5
“The oil refineries are the processing factories of crude-oil. The impurities from the crude oil are removed to obtain petroleum, diesel, kerosene, bitumen, and aviation fuel. Petroleum industry contributes over 15% of the GDP (2015–16). The main refineries of India, their year of commission and production capacity are given in (Fig. 8.5) (Table 8.6).”
Why relevant

Explains that crude oil is processed by refineries into different products, implying there are distinct crude supplies that feed specific refineries.

How to extend

A student could infer that named regional crudes (e.g., 'West Texas') might denote particular supplies/grades used by refineries and then check whether 'West Texas Intermediate' is such a supply name.

Geography of India ,Majid Husain, (McGrawHill 9th ed.) > Chapter 8: Energy Resources > 2. The Gujarat Coast > p. 13
Strength: 4/5
“production from this region was started in 1961. Crude oil from this region is supplied mainly to the Koyali refinery.”
Why relevant

Mentions crude oil from a specific region (the Gujarat coast) being supplied mainly to a named refinery, showing region-linked crude sources.

How to extend

Use the pattern of region-linked crude names to hypothesize that 'West Texas Intermediate' could be a region-linked crude designation and verify by consulting a map or market sources.

Geography of India ,Majid Husain, (McGrawHill 9th ed.) > Chapter 8: Energy Resources > Table 8.5 > p. 12
Strength: 3/5
“• State State: Western Offshore; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 239.20; Contribution to oil Contribution to oil (Percent) (Percent): 39.60; Natural Gas Natural Gas Reserves Reserves: 302.35; Contribution to Oil Contribution to Oil (Percent) (Percent): 23.44 • State State: Assam; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 159.96; Contribution to oil Contribution to oil (Percent) (Percent): 26.48; Natural Gas Natural Gas Reserves Reserves: 158.57; Contribution to Oil Contribution to Oil (Percent) (Percent): 12.29 • State State: Gujarat; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 118.61; Contribution to oil Contribution to oil (Percent) (Percent): 19.63; Natural Gas Natural Gas Reserves Reserves: 62.28; Contribution to Oil Contribution to Oil (Percent) (Percent): 4.83 • State State: Eastern Offshore; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 40.67; Contribution to oil Contribution to oil (Percent) (Percent): 6.73; Natural Gas Natural Gas Reserves Reserves: 507.76; Contribution to Oil Contribution to Oil (Percent) (Percent): 39.37 • State State: Rajasthan; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 24.55; Contribution to oil Contribution to oil (Percent) (Percent): 4.06; Natural Gas Natural Gas Reserves Reserves: 34.86; Contribution to Oil Contribution to Oil (Percent) (Percent): 2.70 • State State: Tamil Nadu; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 9.00; Contribution to oil Contribution to oil (Percent) (Percent): 1.49; Natural Gas Natural Gas Reserves Reserves: 31.98; Contribution to Oil Contribution to Oil (Percent) (Percent): 2.48 • State State: Andhra Pradesh; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 8.15; Contribution to oil Contribution to oil (Percent) (Percent): 1.35; Natural Gas Natural Gas Reserves Reserves: 48.31; Contribution to Oil Contribution to Oil (Percent) (Percent): 3.75 • State State: Arunachal Pradesh; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 1.52; Contribution to oil Contribution to oil (Percent) (Percent): 0.25; Natural Gas Natural Gas Reserves Reserves: 0.93; Contribution to Oil Contribution to Oil (Percent) (Percent): 0.07 • State State: Tripura; Crude Oil Crude Oil Reserves Reserves ( in Million Tones): 0.07; Contribution to oil Contribution to oil (Percent) (Percent): 0.01; Natural Gas Natural Gas Reserves Reserves: 36.10; Contribution to Oil Contribution to Oil (Percent) (Percent): 2.80 Source: Energy Statistics; Ministry of Statistics and Programme Implementation, 2017 The crude oil production in India has been shown in (Fig.”
Why relevant

Lists crude oil reserves by named states/regions, reinforcing that crude is often discussed and classified by geographic source.

How to extend

Apply the geographic-naming pattern to suspect 'West Texas Intermediate' is a Texas-origin crude classification to be checked against external market nomenclature.

Certificate Physical and Human Geography , GC Leong (Oxford University press 3rd ed.) > Chapter 27: Fuel and Power > Sample Objective Ouestions > p. 277
Strength: 3/5
“Lawrence-Great Lakes region• D in the Alberta province• The most convenient and economical way of bulk transportation of oil in most places is by 1. • A pipelines• B tankers• C oil trucks• D tank wagons• The greatest quantity of crude oil is transported between t2. • A Nigeria and Mediterranean Europe• B the Middle East and Westerri Europe• C the Persian Gulf and the U.S.A. • B geothermal power • C solar energy • D power harnessed from the rising tides 16.”
Why relevant

Discusses major oil-producing regions (e.g., Alberta) and bulk transport methods, indicating an international market with regionally sourced crude streams.

How to extend

From the existence of regionally traded crudes and transport routes, a student can reason that 'West Texas Intermediate' may be a traded regional crude benchmark to confirm via market charts.

Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 15: Infrastructure > Crude Oil > p. 446
Strength: 3/5
“• Crude oil production has seen a continuous decline since 2014-15. This decline has been found both in onshore and offshore production.• Reasons for such decline include: natural decline in ageing and mature fields with no major \alphadiscoveries.• India is the world's third largest crude oil importer having storage capacity of 5.3 million \bullettonnes.• At the current rate of production, existing reserves will last for only around two a. decades”
Why relevant

Notes India as a major crude oil importer, implying reliance on international crude grades and benchmarks in trade.

How to extend

Knowing global trade uses benchmark grades, a student could test if 'West Texas Intermediate' functions as one such benchmark/grade in international oil pricing.

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Statement analysis

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Statement analysis

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