Oil Daily: 07.22.10
Firm Middle Distillates Bolster atlantic basin refining margins
Summary: Most years, refiners operating in the Atlantic Basin generally breathe easier during the spring and summer as a seasonal increase in demand for gasoline from US consumers boosts margins on both sides of the Atlantic. This year has also seen margins widen during March and April and then retain their strength, but the driver of this trend is somewhat distinct. Part of the surge is due to a counter-seasonal tightening in the “middle distillate” market for diesel and heating oil. According to a recent report by Boston-based consultancy Energy Security Analysis Inc. (ESAI), the improvement in middle distillate fundamentals has been precipitated by greater demand from the US, Latin America and even Europe.