Up, Up, and Away Crude Oil Futures Lead The Pack This Morning

Up, up, and away. Crude oil futures lead the pack this morning, posting 1.75% gains putting the prompt month contract just below the $92 level. Gasoline and diesel futures “lag” behind, boosting their prices by 2.75 and 4.75 cents, respectively.
The cold snap in refining country seems to be the cited reason why the buyers showed up this morning. The fact that the only news surrounding refinery operations was a small unit shutdown in Memphis and a planned return of run rates in Baytown makes it seem like this morning’s market move might have more to do with momentum than fundamentals.
The difference between the prompt and second month NYMEX diesel contracts reached levels not seen since 2015, and only seen five times in the contract’s 24-year history. Weather-induced demand surge along the eastern seaboard and shrinking supplies is the one-two combo driving a staggering 12.5 cent backwardation into March.
Gasoline prices seem to be along for the ride these past couple weeks, lagging behind both crude oil and diesel futures gains. There are scant reasons to be found explaining any sort of independent market action for the RBOB futures contract, but one would think the immediate outlook for the benchmark should be bearish given the wintry conditions hitting the Northeast again this week.
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