Whilst we remain bullish distillate, and diesel in particular, into Q1 2025, it is becoming important to consider when to get short; perhaps in anticipation of the end of global maintenance mid Q2 2025?
27 November 2024
Time to read: minutes
Commentary summary:
- Whilst Middle Eastern jet arbs continue to point West, Middle Eastern diesel arbs, whilst improving margin wise West, still point predominantly East.
- Global diesel spreads are in backwardation until Autumn Summer 2025 apart from the very prompt HO spread.
- The market appears to be pricing in that Chinese distillate exports, in particular diesel, will not return in force in 2025.
- According to numerous reports, Europe is set for its coldest winter since 2021.
- We remain bullish into Q1 2025, however, the time to get short Feb/Mar or even Jan/Feb spreads could be not too far away!
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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