June ICE GO should expire strongly, after which we have a bearish view on global middle distillate, but admittedly the continuingly low US diesel stocks picture gives us pause for thought

Commentary summary:

• AG/WCI diesel arbs point increasingly West whilst AG/WCI jet exports remain open into Europe and the US.

• USGC TA diesel arbs closed but point to NWE.

• Global jet spreads and cracks decline whilst ICE GO remain elevated, Singapore diesel spreads rebound slightly, and HO spreads remain largely unchanged.

• US diesel stocks are 16M bbls below their 2024 levels at the same period.

• Global jet outlook remains weak whilst diesel should have some strength until June ICE GO expiry. Beyond that, and whilst it is a tough call, the picture turns more bearish.

Singapore’s middle distillate markets have delivered a mixed performance over the past week, confounding our expectations expressed in last week’s commentary, of a uniform decline amid a broader narrative of increasing regional supply.

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.