• Skip to main content
  • Skip to primary sidebar
  • Skip to footer
  • Corporate News
  • Generation
  • Oil & Gas
  • Regulation
  • Renewable
    • Climate
    • Solar
    • Wind
  • Storage
  • Tech
  • T & D
Energy News Desk Logo

Energy News Desk

Energy News and Data

Gasoline and diesel refining margins that diverged in March have moved closer together

August 6, 2020 by EIA Gov

August 6, 2020

selected Gulf Coast crude oil and petroleum product prices

Source: U.S. Energy Information Administration, Bloomberg


U.S. gasoline and diesel crack spreads diverged sharply in March and April as a result of the mitigation efforts aimed at slowing the spread of the 2019 novel coronavirus disease (COVID-19), but they have moved closer since May. Crack spreads are the difference between the price of crude oil and the wholesale price of a refined petroleum product, and they are used by industry to estimate refining margins.

As COVID-19 mitigation efforts and travel restrictions were put in place, gasoline demand (as measured by product supplied) fell from 9.7 million barrels per day (b/d) in the week ending March 20 to a record low of 5.1 million b/d in the week ending April 3. This record low demand caused gasoline prices to fall lower than oil prices, making gasoline crack spreads go negative. At the time, the gasoline crack spread fell to a low of -8 cents per gallon, the lowest since January 2019. In contrast to gasoline demand, distillate demand in the United States in March and April did not decrease as sharply. The consistent demand for diesel contributed to an increase of diesel refining margins because the price of crude oil dropped faster than the price of diesel, allowing refiners to potentially refine low cost crude oil into a higher cost diesel.

U.S. weekly product supplied of selected petroleum products


In April, U.S. refiners curtailed runs and shifted yields to increase distillate production and decrease gasoline production in response to the changing demands of each product. Inputs of crude oil to refineries fell steeply beginning in late March, reaching a low of 12.8 million b/d the week ending April 17, the lowest level since 2008. Since its low points in late April and early May, U.S. gasoline demand has been generally increasing, and distillate demand has varied. The increased gasoline demand led gasoline crack spreads to rise higher than distillate crack spreads in late April and supported higher refinery runs overall. Gross inputs into refineries have been generally increasing since the week ending May 8, and refiners have shifted back to producing more gasoline to meet the increasing gasoline demand.

Principal contributor: Matthew French

Original source: EIA.gov

Filed Under: Breaking

Primary Sidebar

Join The Daily Charge

This week's top 5 stories in your inbox. No spam ever.

Trending

  • Capital Dynamics Sells Majority Stake of Beacon Solar Portfolio
  • Kongsberg Supplying Monitoring Equipment to World’s Largest Floating Wind Project
  • LineVision, OSIsoft Partner to Improve Grid Resiliency
  • Cognite, WindSim Partner on Wind Farm Simulation Technology
  • The University of Maine Collaborates on Floating Offshore Wind Project
  • Avangrid Renewables Submits COP for First Phase of Kitty Hawk Project
  • Texas Oil Boomtowns Devastated by Coronavirus: Photos
  • Emerson Agrees to Purchase OSI Inc.
  • The Hampton Roads Alliance Unveils Offshore Wind Initiative
  • ECO, Orsted and Eversource Execute Agreement for SOV

Footer

Trending

  • Capital Dynamics Sells Majority Stake of Beacon Solar Portfolio
  • Kongsberg Supplying Monitoring Equipment to World’s Largest Floating Wind Project
  • LineVision, OSIsoft Partner to Improve Grid Resiliency
  • Cognite, WindSim Partner on Wind Farm Simulation Technology
  • The University of Maine Collaborates on Floating Offshore Wind Project

Recent

  • Quick Tips To A Sustainable Future
  • Stem Provides Smart Energy Storage Solutions to Today’s Power
  • EIA's AEO2021 shows U.S. energy-related CO2 emissions rising after the mid-2030s
  • Homeowners associations still a barrier for some would-be solar customers
  • Commentary: With open standards, U.S. can build EV charging infrastructure faster

Search

Contact Us

Write For Us

  • Email
  • Facebook
  • Twitter

Copyright © 2023 · EnergyNewsDesk.com