Topic
The difference between crude oil costs and refined product prices, a key measure of refiner profitability also known as the crack spread.
Shell forecast a refining margin of $42 a barrel for July to September, almost double the $24 of the prior quarter and above 2022's high of about $28. The gain came from fuel prices outrunning crude, so diesel buyers now carry refinery risk on top of oil risk.
Reality
Record diesel crack spreads on top of expensive crude have taken the US pump price to an all-time high. Senator Chuck Grassley wants President Trump to ban the exports, which are also at a record.
Perspective Coverage
3 publishersReality
Diesel is above $200 a barrel in the US and Europe, and cryptobriefing.com reports the crack spread past $100 for the first time on record after six months of Strait of Hormuz disruption. The extra US fuel bill since late February is put at $100.9 billion.
Reality
The trade ministry summoned SK Energy, GS Caltex, S-Oil and HD Hyundai Oilbank on the 14th, with spot Dubai crude up 53% in five weeks and the freight differential rate, once 100% and now 25%, back under review.
Reality
U.S. diesel futures hit their highest since 2022 and the crack spread topped $106 a barrel. Against $90.33 crude, that puts 54 cents of every wholesale dollar in the refining step. That margin is priced in months. A plant is priced in years.
Reality
Korean refiners have run hard past the index this month, but the margin holding them up comes from Saudi Arabia repricing Asian crude by $11.50 a barrel and from product plants that have not come back yet.
Reality