Oil Products Summary: Diesel Cracks Soften

Diesel cracks are edging lower after the strength seen in July while gasoline cracks have found some support after the recent pull back. Cracks have been supported by tight supplies, recent refinery disruptions and low global inventories although refinery outages have eased from the high levels seen in June.

• US gasoline crack down -0.7$/bbl at 35.61$/bbl
• US ULSD crack down -0.7$/bbl at 44.13$/bbl
• Refinery outages and run cuts, increasing managed money net long positions and the loss of medium-sour crude from the market are contributing to the recent diesel crack spreads strength according to FGE.
• Near term Gasoil backwardation has softened from the high time spreads seen at the start of August suggesting an easing of the near-term tight supplies as crack spreads have drifted lower and refinery outages have reduced.
• The prompt spread has fallen from a peak of 21.75$/mt on 1 Aug back to the lowest since 26 July at 8.0$/mt.
• The Dec23-Dec24 spread has pulled back from 86.75$/mt on 2 Aug to 67$/mt but remains high compared to around 23$/mt from the start of July amid ongoing tight supplies and low global inventories.
• Gasoil AUG 23 down -0.1% at 888.25$/mt
• Gasoil AUG 23-SEP 23 unchanged at 10.5$/mt
• Gasoil DEC 23-DEC 24 down -0.5$/mt at 73.75$/mt
• EU Gasoil-Brent up 0.7$/bbl at 31.4$/bbl
• Rising middle distillate margins are an incentive for refineries to boost utilisation rates, according to Macquarie.
• India's fuel consumption, a proxy for oil demand, rose by 1.9% year-on-year in July to around 18.09 million tonnes.
• ARA diesel and gasoil arrivals have slowed in August and imports may remain lower beyond this month amid the start of seasonal maintenances in other regions.
• TotalEnergies’ Port Arthur 238kb/d refinery in Texas will begin a multiunit turnaround on 21 Aug.
• Chinese Refiners are waiting for a new batch of product export quotas in August before ramping up exports further.
• Chinese state refiners plan to raise run rates to a record 81.25% in August, a month-on-month rise of 1.26%.
• Germany’s gasoline and naphtha sales beat pre-pandemic levels in May for the first time since February.