When it comes to oil measurements, the size of a barrel can vary depending on who you ask or where the oil originated. There are two common sizes used – 42 US gallons or 55 US gallons. Understanding the difference and when each size is used is important for accurately tracking oil production, transport and pricing.
The 42 Gallon Barrel
In the United States, a standard barrel of oil is defined as 42 US gallons. This measure was established in the 19th century and is still widely used today, especially for benchmark crude oils like West Texas Intermediate (WTI) and Brent crude. There are a few key facts about the 42 gallon barrel to keep in mind:
- The 42 gallon size was originally established for whiskey barrels in the early 1800s. It was adopted as a standard oil measure by the Pennsylvania oil fields in the 1860s.
- In the US, federal law defines a standard barrel of oil as 42 US gallons. This is codified in Title 15, Chapter 76 of the US Code.
- The 42 gallon barrel is used as the standard unit for benchmark US crude oil prices like WTI and domestic oil futures contracts on NYMEX.
- When talking about US oil production, refining or transportation, volumes are typically discussed in terms of 42 gallon barrels.
So in the United States, the most common application of the term “barrel” refers to 42 US gallons of oil. All major US oil statistics like production, inventory and refining capacity use this 42 gallon barrel definition as standard.
The 55 Gallon Barrel
While 42 gallons is standard in the US, many other countries use a bigger 55 gallon oil barrel instead. The 55 gallon barrel first became popular for shipping crude oil that was produced for export. There are a few key details on the 55 gallon barrel:
- The 55 gallon barrel was used extensively for export oil shipments from the US Gulf Coast starting in the early 20th century.
- It was adopted as a standard unit for oil cargo capacity on tankers and similar vessels.
- Today, most global crude oil grades are still quoted based on the 55 gallon barrel size instead of 42 gallons.
- Key global benchmarks like Brent crude and Dubai crude use 55 gallon barrel pricing.
- When talking global oil trade, volumes are typically discussed in terms of 55 gallon barrels.
The 55 gallon barrel came from the need to have a standard cargo measurement and just stuck over time. It allows for easy calculations on crude oil shipments and pricing no matter where the oil is produced or shipped.
Why Are There Two Different Barrel Sizes?
The use of two different barrel sizes for oil can seem odd. But it comes from the evolution of the oil industry in different regions during the 19th and 20th centuries. Here’s a quick look at why the 42 and 55 gallon sizes developed:
- The 42 gallon US barrel was pioneered by the new American oil industry and tied to whiskey barrels commonly in use.
- The 55 gallon barrel became popular for international trade and transport on ocean tankers.
- As oil became a global commodity, the 55 gallon size was retained for seaborne trade and pricing.
- The US market kept the 42 gallon barrel as the standard for domestic statistics.
So while dual standards developed, there were good practical reasons at the time. And now the entrenched standards continue to be used in their respective spheres of influence. While confusing at times, the oil industry is accustomed to shifting between the two barrel measures.
Converting Between 42 and 55 Gallon Barrels
Since the two barrel sizes are used in different contexts, it’s helpful to know how to convert between them. Here are the basic formulas to go from 42 to 55 gallons or vice versa:
- 42 US gallons = 1 barrel
- 55 US gallons = 1 barrel
- 1 barrel (42 gallons) = 0.758 barrels (55 gallons)
- 1 barrel (55 gallons) = 1.31 barrels (42 gallons)
So in summary:
- 42 US gallons = 1 42-gallon barrel
- 55 US gallons = 1 55-gallon barrel
- 1 42-gallon barrel = 0.758 55-gallon barrels
- 1 55-gallon barrel = 1.31 42-gallon barrels
These conversion factors make it easy to switch between the two units. For example, 1 million barrels of exported Brent crude would be equal to 758,000 barrels on the US domestic market. Or 1 million barrels of WTI produced in the US would equate to around 1.31 million barrels if being exported overseas.
How Much Oil is in Each Type of Barrel?
Since the two sizes are different, each barrel measure contains a different actual volume of oil. Here’s how much oil you get with the 42 and 55 gallon barrels:
- 42 gallon barrel = 158.99 liters = 34.972 gallons = 42 US gallons of oil
- 55 gallon barrel = 208.20 liters = 45.819 gallons = 55 US gallons of oil
So a 42 gallon barrel holds almost 35 gallons or 159 liters of oil. The 55 gallon barrel holds about 46 gallons or 208 liters of oil.
Recent Trends Towards the 55 Gallon Barrel
While both sizes remain in use today in different contexts, there has been a shift towards using the 55 gallon barrel more often recently. There are a couple reasons for this trend:
- Global oil markets have expanded, so more focus is on international trade volumes.
- As US oil production has surged, exports have increased significantly.
- OPEC+ quotas and strategic reserves are also based on 55 gallon barrels.
- Pricing benchmarks like WTI are now traded globally, bringing the 55 gallon barrel into US markets.
Many analysts will now cite figures in both 42 and 55 gallon terms. The EIA also publishes data in both barrel sizes. So the 55 gallon barrel is becoming more common, but the 42 gallon measure still holds in US statistics.
Examples of the Barrel Sizes in Use
To help clarify the usage in practice, here are a few examples of when you’ll see the different oil barrel sizes used:
- The EIA weekly US petroleum status report uses 42 gallon barrels for crude oil and petroleum product inventory levels.
- OPEC production quotas and capacity figures are expressed in 55 gallon barrels.
- US Strategic Petroleum Reserve capacities and drawdown volumes use 42 gallon barrels.
- US crude oil futures contracts on NYMEX are priced based on 42 gallon barrels.
- International spot crude prices like Brent and Dubai crude use 55 gallon barrel pricing.
- US crude oil production figures from the EIA are given in 42 gallon barrels.
- Crude oil cargo volumes at major seaborne trading hubs are expressed in 55 gallon barrels.
So in summary, the 42 gallon barrel is still widely applied in US petroleum measurements. But the 55 gallon barrel increasingly is used in international contexts and for traded commodities.
How Oil Barrels Impact Crude Oil Prices
The size of oil barrels also impacts how crude oil prices are commonly quoted. Since different benchmarks use different barrels, prices vary slightly:
- WTI and Nymex oil futures use 42 gallon barrels, so prices are lower compared to international grades.
- Brent crude and other seaborne grades use 55 gallon barrels, so their prices are higher for the same oil.
- The spread reflects the 7-8% difference between the two barrel sizes.
For example, if WTI is trading at $50 per barrel and Brent is at $54, this represents essentially the same price per gallon of oil. The barrel sizespread just impacts the headline price. Traders account for the different barrel convention when executing arbitrage trades between benchmarks.
Industry Groups Push for Global 55 Gallon Standard
Because of the complications around dual oil barrel sizes, there have been calls for global standardization to the 55 gallon barrel:
- Groups like OPEC, IEA, oil majors and the UN have advocated for a switch to 55 gallons worldwide.
- They argue it would simplify global oil statistics, pricing, contracts and regulation.
- But the US and petroleum groups have resisted due to the cost of converting data and statistics.
While a single global oil barrel standard would have advantages, the entrenched use in the US market has made adoption difficult. For now, analysts and traders need to understand the ambiguities and convert accordingly.
Summary: It Depends on Geographic Context
In summary, oil barrel sizes depend on where the oil is produced and traded:
- The 42 gallon barrel is standard for US petroleum measurements and pricing.
- The 55 gallon barrel is used for global seaborne trade and benchmarks.
- Knowing which size is applied is important for accurate comparisons and analysis.
While having two major sizes leads to complexity, this framework reflects the evolution of the oil market. The appropriate barrel size varies by each geographic context and situation. So whether it’s 42 or 55 gallons to a barrel depends on if you’re looking at US or international oil data.
Conclusion
The oil industry uses both 42 gallon and 55 gallon barrels depending on the geographic context. In the US, 42 gallons is standard, derived from historical whiskey barrels. But 55 gallons became prevalent on global export markets and for seaborne trade. As a result, measurements can differ, affecting prices and statistics. Knowing when each standard applies provides for proper analysis and conversion between the two. While a single global standard would be simpler, the longstanding conventions are entrenched in their respective spheres. So for the foreseeable future, the question of whether a barrel is 42 or 55 gallons comes with the classic response: “It depends.”
