OIL PRODUCTS: Weakest Diesel Spreads in Years Seen Spelling Trouble for Crude
Apr-30 17:57
Prompt diesel is trading at the widest discount to supplies for later delivery, a bearish market structure that may lead to trouble for crude prices, Bloomberg said.
- The prompt time spread for diesel is currently at the widest since Sep. 2020 at around $1.60/gal.
- Seasonal variances and higher interest rates are hampering diesel demand, which could eventually weigh on crude oil prices, according to Dennis Kissler, senior vice president at BOK Financial.
- Even amid an expected rise in air conditioning use, higher interest rates may curtail the summer boost in diesel.
- “If you see diesel in a bear market, I believe crude oil will follow,” Kissler said.
- Diesel supplies are also building in the US as refinery capacity comes back online after a heavy maintenance season and with new refinery capacity coming online globally.
- Distillate inventories, mainly diesel, are seen with a build of 0.4m bbl last week, according to a WSJ survey. Responses ranged from -2m bbl to +2.4m bbl.
Source: Bloomberg
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
MNI: POWELL SAYS PCE INFLATION CAME IN LINE WITH EXPECTATIONS
Mar-29 15:26
- MNI: POWELL SAYS PCE INFLATION CAME IN LINE WITH EXPECTATIONS
MNI: US FEB PERSONAL INCOME +0.3%; NOM PCE +0.8%
Mar-29 12:30
- MNI: US FEB PERSONAL INCOME +0.3%; NOM PCE +0.8%
- US FEB PCE PRICE INDEX +0.3%; +2.5% Y/Y
- US FEB CORE PCE PRICE INDEX +0.3%; +2.8% Y/Y
- US FEB UNROUNDED PCE PRICE INDEX +0.333%; CORE +0.261%
FRANCE AUCTION PREVIEW: On offer next week
Mar-29 10:32
E11.0-12.5bln of LT OATs on Thursday 4 April (a slightly smaller auction than in February or March):
- the 3.50% Nov-33 OAT (ISIN: FR001400L834)
- the 3.25% May-55 OAT (ISIN: FR001400OHF4)
- the 4.00% Apr-60 OAT (ISIN: FR0010870956)
- the 1.75% Jun-39 Green OAT (ISIN: FR0013234333)
Up to E7.2bln of 13/22/24/51-week BTFs on offer Tuesday 2 April:
- E3.1-3.5bln of the new 13-week Jul 3, 2024 BTF
- E0.1-0.5bln of the 22-week Sep 4, 2024 BTF
- E1.3-1.7bln of the 24-week Sep 18, 2024 BTF
- E1.1-1.5bln of the 51-week Mar 26, 2025 BTF
