Oil Products End of Day Summary: Cracks Weaken

Both diesel and gasoline cracks softened, reversing some moderate gains earlier in the day. Cracks remained trading lower despite the fall in WTI. The gasoline complex continues to remain weak as demand continues to hover below the four-week average.

• RBOB NOV 23 down -2.5% at 2.27$/gal
• US gasoline crack down -0.2$/bbl at 10.81$/bbl
• US ULSD crack down -0.6$/bbl at 40.24$/bbl
• Gasoil NOV 23 down -3.9% at 884.5$/mt
• Gasoline inventories are expected to fall by 0.3m bbl on the week when the EIA released the data Oct. 25, based on a WSJ survey. Distillate stocks are expected to fall by 1.1m bbl, with a range of responses between a 2.9m bbl fall to a 1.1m bbl rise.
• US gasoline imports from Europe in the week through October 19 matched the previous period’s four-week low according to Bloomberg vessel tracking.
• Weaker than normal demand following the summer driving season and building gasoline stocks had been weighing on gasoline prices since mid-August. Supplies remain steady as refining utilisation is boosted by healthy refining margins driven by robust diesel cracks although is currently limited by refinery maintenance.
• EIA data implied demand has seen a slight recovery in recent weeks although US gasoline demand fell 1.8% last week to 8.7mb/d and 0.2% below the four-week average according to GasBuddy.
• Marathon Petroleum’s 593kbpd Galveston Bay refinery in Texas is expected to undergo maintenance at least until mid-November, people familiar with the plant operations said, cited by Reuters.
• Oman’s new 230kbpd Duqm refinery is ramping up production with the refinery utilization close to 60% as of October according to Petro Logistics.
• Independent refineries in China’s Shandong region imported 2.39m mt of crude oil in the week to Oct. 22, according to OilChem.