UBP sees refining margins staying high amid global capacity shortfall
USO•A global refining capacity shortfall exceeding 10% is expected to keep margins high. European refining margins reached $50 per barrel this summer, while diesel margins hit $100 per barrel.
1. Margins and fuel costs
A global refining capacity shortfall exceeding 10% is expected to keep refining margins high. European margins reached a record $50 per barrel this summer, and diesel margins hit $100 per barrel. Total diesel costs reached a record $200 per barrel, while Brent traded around $100 per barrel.
2. Delivery and inventory costs
Consumer fuel costs average around $140-$180 per barrel when refining margins are added to Brent crude prices. Logistics add more than $30 per barrel to delivery costs, and rebuilding depleted oil inventories will create additional demand.
