Diesel cracks shifted into overdrive the last two weeks, leaving double-digit territory in the rearview mirror. As we discussed in our Crude Billboard for the week ended September 18, the diesel crack skyrocketed to a record high of $113.48/bbl on Wednesday, September 16 before easing to $108.10/bbl on Friday (far right of green line in chart below). Diesel cracks have now settled above $100/bbl every day since September 9, turning what was recently a brief spike into a sustained stretch of extraordinary refining economics.
The benchmark 3-2-1 crack (blue line) rose 10% to $74.46/bbl, helped by a rebound in gasoline cracks (orange line). Diesel remained the defining feature of the barrel: its crack finished the week more than $50/bbl above gasoline’s and at more than three times its year-ago level. Fall maintenance would normally pull refinery runs lower in the coming weeks. However, with diesel margins this strong, refiners have a compelling reason to keep units running where they can, limiting the seasonal decline. The question is how long those runs can rise to meet diesel demand before they begin to cool the crack.
