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OIL PRODUCTS: Mid-Day Oil Procucts Summary: Cracks Set for Weekly Decline

OIL PRODUCTS

Diesel and gasoline crack spreads are holding steady today amid a declining trend in place since early July driven by weak demand.  The impact of soft margins on refinery runs is of key focus amid healthy supply and demand growth uncertainty.

  • China’s diesel consumption may fall 5.6% y/y in H2 2024 to 107.2m tons, after a 4.2% drop in H1 2024, according to OilChem cited by Bloomberg. Lower demand in H2 to be driven by weaker logistics and infrastructure spending while inventories are still “seasonally high.”
  • Calcasieu Refining Company has halted operations at the 135.5kb/d Lake Charles refinery, Louisiana, after a chemical overflow caused heavy flaring, according to Reuters citing a local media report on July 18.
  • Sinochem has shut in two of its three east China oil refineries for an indefinite maintenance period, according to Reuters sources amid poor margins due to high crude oil costs and weak fuel demand.
  • Indian Oil Corp. plans to expand capacities at three refineries in 2025-26 amid rising demand in India, according to Chairman Shrikant Madhav Vaidya in the annual report.
    • US gasoline crack unchanged at 23.05$/bbl
    • US ULSD crack up 0.1$/bbl at 21.78$/bbl

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