Worst yet to come for diesel…Reuters

Reuters points reminds us that refiners while accommodating strong gasoline demand are also putting out more diesel than is needed:

“Oil refineries are shifting into high gear to produce as much gasoline as possible for the world’s fuel-hungry drivers – kicking the problem of a worsening diesel glut further down the road.”

Here is a dismal outlook by an analyst:

“”The worst is definitely yet to come. The diesel crack can still move lower … to negative, even,” said JBC analyst Michael Dei-Michei, referring to the gap between the price of diesel and the cost of the crude needed to produce it – a measure of profitability. “That’s not out of the question.””

(A small caveat: beware of oil analysts who speak in certainties)…

Here is the diesel crack using June futures(from barchart.com):

And, here is an ETF, symbol CRAK, which is made up of refineries around the world:

Here is the Reuters link:  http://www.reuters.com/article/us-diesel-glut-idUSKCN0X514K