The fragrance of oud is derived from the tropical agar tree, which is thought to originate in Assam in India. When the tree is infected by a mould known as Phialophora parasitica it reacts by producing a dense, dark and fragrant resin to protect itself. It is the resin-embedded heartwood of the tree that is the source of oud.
The trees are grown throughout south-east Asia, India and Bangladesh and agarwood is said to be the most expensive timber in the world - indeed, one of the most expensive of all natural raw ingredients. The fragrance is described as warm, woody with a slight hint of damp rot, while some varieties are smoky and sweet.