Are diesel stocks building enough before Q1 and Spring-time global maintenance?
Commentary summary:
- Whilst USGC TA arbs are workable in the very prompt, Middle Eastern diesel arbs point East still.
- Middle distillate cracks globally exhibit strong gains, with the ICE GO spread following.
- Doubts remain about the speed at which Russian diesel exports will recover!
- Will we build enough distillate stocks before we reach USGC maintenance in Q1 2025?
As highlighted in last week’s commentary, “Reduced PADD1 crude runs, a closed USGC TA arb and Middle Eastern arbs still pointing East lead us to remain bullish ICE GO despite refinery returns”, global distillate cracks have extended their upward trajectory this week, continuing the gains seen since the expiration of November ICE Gasoil futures in mid-October, with diesel outperforming jet in recent strength.
James Noel-Beswick is Commodity Owner for Sparta. Before joining Sparta, James worked as an analyst for likes of BP and Shell and leads our continued development of the distillate product vertical.
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