Widening Crack Spread's?
From a Naybob of Transport… "It remains very ugly, and thus far at least on our segment of the business we don’t see any recovery in the works.
July is traditionally either the slowest month of the year for us or the second slowest month and its proving to be true.
Most of our European manufactures are on their annual 4 week holiday plant shutdown. I think the industry has indeed hit bottom and just hovering there, but then again, I’m not so sure.
Not getting any positive signals from my customers either. All are hopeful that we starting seeing a recovery in the 4th qtr, but again who knows."
The Nattering One muses… U.S. refineries ran at 87.8% in the week ended July 10, and inventories of distillates were the highest in 24 years.
What shortage?
The profit from turning three barrels of crude into two of gasoline and one of distillate reached $23.95 on May 17, 2007, a record going back to at least 2000.
When crude reached a record $147.27 a barrel on July 11, 2008, the crack spread had fallen to $11.762.
Within five years, about 25% of capacity in North America and 30% of Europe’s will be idled, the IEA says.
The idled capacity and shuttered refineries will result in lost jobs, higher costs and a loss of refining capacity in this country.
It will make it too costly for marginal refiners to operate in the U.S. and compete with new refineries being built in Asia.
Is it time to buy crack spread call futures contracts?
Side bar, The United States Natural Gas Fund will suffer from record high natural gas inventories and seasonal prices hitting the ETF harder than the fuel abundance.
Again, what shortage?
July is traditionally either the slowest month of the year for us or the second slowest month and its proving to be true.
Most of our European manufactures are on their annual 4 week holiday plant shutdown. I think the industry has indeed hit bottom and just hovering there, but then again, I’m not so sure.
Not getting any positive signals from my customers either. All are hopeful that we starting seeing a recovery in the 4th qtr, but again who knows."
The Nattering One muses… U.S. refineries ran at 87.8% in the week ended July 10, and inventories of distillates were the highest in 24 years.
What shortage?
The profit from turning three barrels of crude into two of gasoline and one of distillate reached $23.95 on May 17, 2007, a record going back to at least 2000.
When crude reached a record $147.27 a barrel on July 11, 2008, the crack spread had fallen to $11.762.
Within five years, about 25% of capacity in North America and 30% of Europe’s will be idled, the IEA says.
The idled capacity and shuttered refineries will result in lost jobs, higher costs and a loss of refining capacity in this country.
It will make it too costly for marginal refiners to operate in the U.S. and compete with new refineries being built in Asia.
Is it time to buy crack spread call futures contracts?
Side bar, The United States Natural Gas Fund will suffer from record high natural gas inventories and seasonal prices hitting the ETF harder than the fuel abundance.
Again, what shortage?
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