Global mogas/diesel spreads have been weakening since late September, falling down to levels last seen in August.
Whilst the outlook for gasoline markets is still largely favourable vs middle distillates, stagnating mogas stocks in the US amid a few weeks of sudden, strong draws on distillate inventories have weighed on Atlantic Basin gasoline assessments in recent weeks.
A shift in production away from gasoline, however short-lived, is likely to help keep the market comparably tight, however, and we would not see distillate inventories – assuming draws continue at the current rate – realigning fully with year-ago levels until late December/early 2021.
6 Nov 2020 Featured in: Top of the Barrel - Issue 11
Research Highlights - Week 45
Even a brief shift away from gasoline production in the US could see middle distillate inventories returning to 2019 levels at best in late December (see Top of the Barrel – Issue 11)