Distillate Cracks are Elevated but Could be Capped

Distillate fuel inventories are approximately 8% below their 5-year average due to strong domestic demand for diesel and heating oil, as well as solid export demand.  Refiners are in the process of making the switch over to peak distillate production, and high gasoline inventories will incent refiners to produce more diesel and heating oil.

The heat crack, which is the margin between NY Harbor…