BY CONTINUING TO USE THIS SITE, YOU ARE AGREEING TO OUR USE OF COOKIES. REVIEW OUR COOKIE NOTICE
X

Platts Jet Fuel

A closer look at Platts jet fuel coverage


European ultra low sulfur diesel/jet fuel crack spread widens as fundamentals diverge

London (Platts)--25Sep2017/826 am EDT/1226 GMT


Diesel continues to outshine jet as the strongest middle distillate crack as the fundamentals in Europe for both products diverge to some degree, with the latter market coming out of its peak summer demand period at the same as the former is in the grip of a very steep backwardation.

The diesel spot FOB barge crack versus dated Brent was $14.76/b Friday while the jet equivalent was $0.68/b lower at $14.08/b.

The difference between the two cracks has averaged over $1.00/b since diesel overtook jet on September 6.

The diesel market is braced for an anticipated tight couple of months ahead with some turnarounds and less inflows from the US encouraging bullish sentiment.

While differentials have been relatively low for 10 ppm, the market strength currently is best shown in the steep backwardation through the ICE low sulfur gasoil futures contract with October versus December having stabilized around $15.00/mt over the last week. It had been trading around $5.00/mt at the end of August.

Over the past month, jet fuel differentials have halved on a high arrival program in September with similar expectations for October set against a backdrop of falling demand as the summer holidays come to an end. As a result, jet fuel barge cracks have fallen behind their diesel counterparts.

"People are maxing diesel and you're only needing the jet for blending," one trader said. "The thing to keep in mind is yields. If you count for density, jet is about $9/mt under diesel. With that kind of backdrop [high imports and low demand], it is hard to see it [jet] growing $10/mt [on a density-adjusted basis]."

--George Shaw, george.shaw@spglobal.com
--Caroline Knight, caroline.knight@spglobal.com
--Edited by Jeremy Lovell, jeremy.lovell@spglobal.com

Platts Email


Jet FOB Rotterdam Barg
JJet/Kero FOB Singapore Cargo
Jet 54 FOB USG Pipeline



Back

Platts and IATA

The Jetfuel Price Monitor is a joint Platts - IATA initiative
The index and price data shows the global average price paid at the refinery for aviation jet fuel at the reported date.

Platts
Platts
Copyright © 2018 S&P Global Platts, a division of S&P Global. All rights reserved.