Diesel Markets Pull Back After Surge Late Yesterday

Diesel cracks are easing back along with the wider oil complex following gains late yesterday which were driven by a power outage halting operations at the 435kbpd Whiting refinery.

• BP is planning to restart units at the refinery today with power expected to be restored to the plant by 11:00pm ET Friday, the City of Whiting said in a statement, citing BP officials according to Argus.
• A large and complex refinery such as Whiting could resume operations within a week but restart times can vary widely following power outages, said John Auers at Refined Fuels Analytics.
• Concern for tighter supplies, especially in Europe, due to Red Sea tanker diversions and upcoming refinery maintenance has supported distillates markets this week but with upside limited by demand concern. Cracks however saw a net fall yesterday driven by headlines prompting optimism for a Gaza ceasefire.
• The US front month crack spread is down from a high of 41.6$/bbl yesterday and around 40.45$/bbl late in the day to 39.1$/bbl.
• Data this week showed US distillate stocks 5.2% below the five year average, European ARA Gasoil stocks 13.4% below and Singapore Middle Distillates inventories 35% below average.
  • Gasoil FEB 24 down -3.3% at 826.5$/mt
  • ULSD MAR 24 down -0.9% at 2.69$/gal
  • Gasoil FEB 24-MAR 24 down -0.25$/mt at 17.25$/mt
  • Gasoil JUN 24-DEC 24 down -5$/mt at 28.25$/mt
  • EU Gasoil-Brent down -0.6$/bbl at 27.2$/bbl
  • US ULSD crack down -1.3$/bbl at 39.09$/bbl