The diesel market split into two directions last week, adding to the confusion and uncertainty that buyers have been facing. Inventories of ultra low sulfur diesel (USLD), which had already been at record-breaking lows, managed to decrease even further in price. USLD had been rising faster than the price of crude oil and gasoline on the CME commodity exchange, but as of recent, it seems to be reflecting a slower upward trend. The overall increase in crude prices have been attributed to several factors regarding Russia’s invasion of Ukraine, including Ukrainian shut-off from Russian natural gas supply. While the CME is able to pinpoint the causes of price changes for commodities such as crude oil and natural gas, it is not able to easily identify the causes for the price changes for USLD. A recently published article by Freight Waves reports on the topic with insights from industry professionals.
To read the article, click here.