BCGE says diesel crack spread nears USD 100 as refined fuel supply tightens
USO•BCGE said the ARA diesel crack spread rose to nearly USD 100 in September from under USD 20 early in the year, as refined-fuel supply tightened. It sees scope for easing in coming months but expects prices to remain elevated without broad geopolitical de-escalation.
1. Diesel costs surge
BCGE flagged a sharp diesel price rise linked to constrained refined-product supply tied to Middle East disruptions and reduced Russian exports. US diesel reached nearly USD 6.50 per gallon by late September, up from about USD 3.50 in January, while gasoline remained above USD 4.
2. Supply and inflation risks
The ARA diesel crack spread climbed to nearly USD 100 in September from under USD 20 early in the year, implying extreme refining margins. BCGE said prolonged high diesel and jet fuel costs risk wider inflation pressure and raise the odds of less-accommodative central bank policy in the US and Europe.
