Oil Products Summary at US Close: Diesel Cracks Recover

Diesel cracks recovered from a low earlier in the day with a boost to demand. Meanwhile, inventories remain low despite the small build this week, while supply is squeezed by Russia’s export ban.

• US ULSD crack up 2.7$/bbl at 45.83$/bbl
• US gasoline crack down -1$/bbl at 12.38$/bbl
• US average pump prices for gasoline are down 1.5 cents/gal on the day, as prices soften during the week, according to GasBuddy.
• Russian Energy Minister Nikolai Shulginov said earlier Thursday that the fuel export ban will not be lifted soon and will remain in place until the domestic market stabilizes.
• Gasoline cracks have fallen with further weakness in demand driving an unexpected stock build in EIA data yesterday.
• ARA Insights Global Data - Inventory type, latest level, weekly change (all in thousand metric tons) as follows: Gasoline: 1,328, +2, Naphtha: 170, -13, Gasoil: 1,991, +79, Fuel Oil: 1,041, -37, Jet Fuel: 758, +45.
• The Chinese government will not issue new quotas for clean oil product exports or additional crude imports this year according to three Platts sources.
• Chinese refining combined crude throughput is likely to hit a record high in September.
• Global road-diesel and jet fuel demand has been lifted by strong Chinese trucking activity and a pick-up in international travel ahead of the Golden Week holiday according to JPMorgan.
• Europe is pulling in higher diesel volumes in September mainly due to increased shipments from India and Saudi Arabia. Arrivals in the European Union and the UK are likely to reach 1.1mbpd – 14% higher than August.
• Russia’s gasoline production in August rose by 1.6% compared to the same month in 2022 reaching 3.829m mt, according to Rosstat.
• Exxon’s 564kb/d Baytown refinery is starting a turnaround on the biggest of three crude units this week as part of maintenance on several units over the next several weeks.
• Aramco will start talks to buy a 10% stake in a Chinese refining and petchem company according to joint statements out this week in a move that will tie up more long-term Saudi crude volumes to the region.