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US Cracks Decline as Weak Demand Offsets Tight Supply

OIL PRODUCTS

Diesel and gasoline crack spreads continue to ease back but remain well below levels seen earlier in the year.

  • Weak near term demand is limiting refined product upside despite tight supply concerns. EIA data yesterday showed the four week gasoline implied demand falling again down to the bottom of the five year range and nearly 7% below the average. Diesel four week implied data remained largely unchanged last week although is also over 4% below the five year average.
  • High US refinery outages following winter disruption in December, the upcoming planned maintenance season and unplanned outages are all provide wider support to refined product markets.
  • The US gasoline crack has fallen from a high of around 33$/bbl early yesterday to 28.4$/bbl while the diesel crack is down from 63.6$/bbl on 24 Jan to 56.2$/bbl.
  • US 321 crack down -0.2$/bbl at 37.65$/bbl
  • US gasoline crack down -0.6$/bbl at 28.37$/bbl
  • US ULSD crack down -0.3$/bbl at 56.17$/bbl


Source: MNI / EIA

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