Refining margins for diesel rise as traders anticipate persistent tightness despite a temporary Iran war truce.
The US diesel futures crack spread climbed to $62.84 a barrel on Thursday, its highest level in three weeks, reflecting ongoing supply tightness in the market. The spread measures the difference between ultra-low sulfur diesel futures and West Texas Intermediate crude prices, signaling strong refining profitability.
Diesel markets have faced pressure from disruptions in the Strait of Hormuz and reduced Russian fuel exports due to refinery damage from drone attacks. While broader oil markets have softened recently, product-specific tightness remains a key concern for traders.
Analysts noted that diesel is particularly sensitive to Middle East tensions, and traders are cautious about potential flare-ups despite the temporary truce. The resilience in diesel margins contrasts with broader crude market trends, where recent declines have been more pronounced.