Oil rally and Saudi price spikes could hurt refiners, stifling market recovery

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Oil price rally and Saudi price increases could hurt refiners, stifling market recovery

Data from refineries across several regions shows weak margins, or "crack spreads" — the difference between the price of crude that refiners buy versus the price that the market is paying for the refined products.

A view of the Marathon Petroleum Corp's Los Angeles Refinery in Carson, California, April 25, 2020 after the price for crude plunged into negative territory for the first time in history on April 20.Oil prices pared gains on Monday, despite the weekend announcement by OPEC and its allies, known as OPEC+, that historic production cuts of 9.6 million barrels per day across the group would continue through July as the coronavirus pandemic continues to weigh on demand.

Very poor refining margins and the recent sharp decline in U.S. crude bases now comfort us in our sequentially bearish outlook."One word of caution is if we look at the rally we've seen in crude oil prices, it's been amazing, but the big uncertainty is if you look at refinery margins, they are very weak across the board across all regions," Warren Patterson, head of commodities strategy at ING.

 

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The whole thing is a corrupt racket.

saudis take price low , they want $100 . what is the news?

It's because price fixing doesn't work, falsely raising oil prices on weak demand by cutting production then refining it to fuel on weak demand only cuts profit margins. I guess we could pass on the prices fixing to gas prices at the pump, which will also add to inflation.

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Saudi Arabia's Q1 oil-export revenue drops $11 billion as prices tank - Business InsiderBusiness Insider is a fast-growing business site with deep financial, media, tech, and other industry verticals. Launched in 2007, the site is now the largest business news site on the web. Always be thankful for the bad things in life. They open your eyes to see the good things you weren't paying attention to before. They’re not happy with China now This is the lowest, Saudi must find none oil income sources
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