NEW YORK (Reuters) - Cash prices for Chicago ultra-low sulfur diesel tumbled to a four-year seasonal low on Friday, as Midwest refiners struggle to find buyers amid weaker seasonal demand, while they run full-tilt to capture strong margins for the product, traders said.
Midwest refiners are running at the highest rates for this time of year since 2014 to chase a distillate refining margin that is the strongest in five years.
(For a graphic on refinery run rates, see: tmsnrt.rs/2GAweR7)
(For a graphic on distillate refining margins, see: tmsnrt.rs/2GyuIPb)
However, refiners seeking to sell the product are contending with typically weaker seasonal demand this time of year, traders said. This has sent prices in the region plummeting from a one-year high reached in mid-November, when distillate stockpiles fell due to a lengthy refinery maintenance season and strong product buying.
(For a graphic on Midwest distillate inventories, see: tmsnrt.rs/2GzXxe6)
Chicago diesel cash differentials on Friday sank to 22.00 cents per gallon below the heating oil futures contract on the New York Mercantile Exchange, its weakest seasonally since 2014. Differentials are at their outright lowest since April 2015.
(For a graphic on Chicago diesel cash differentials, see: tmsnrt.rs/2Ra2EFZ)
Facing similarly weak winter demand amid high refinery run rates, Chicago CBOB gasoline cash prices also fell to their weakest for this time of year since 2014.
(For a graphic on Chicago gasoline cash differentials, see: tmsnrt.rs/2Rfy1Pq)
Reporting by Stephanie Kelly; editing by Jonathan Oatis