By: Alex Hodes, Energy Analyst - KC Energy
Key Takeaways:
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On this episode of Focus on Fuels, StoneX Energy Desk Director of Market Strategy Alex Hodes and Energy Risk Manager Trevor McClanahan unpack the hidden forces behind recent market moves—and what they could mean for summer prices.
After a quiet stretch, refined products are back in focus. Despite soft expectations entering 2025, refinery outages across the Atlantic Basin have created a supply crunch. As McClanahan points out, “the diesel market is starved.” That’s reflected in time spreads and crack spreads, with elevated refining margins even as inventories remain tight.
Meanwhile, China’s April crude throughput hit its lowest point in over a year. But as U.S.–China tariff talks progress and some levies have been delayed, Hodes suggests we may be finding an interim bottom: “It’s not bullish, but maybe less bearish.” A bounce in Asia’s imports could be next.
Further into the discussion, the conversation shifts to OPEC, where new quota announcements aren’t necessarily what they seem. “It’s about saving face,” says Hodes. Members like Kazakhstan were overproducing. Rather than enforcing cuts, OPEC raised the quota ceiling to restore unity—without changing real output.
On the U.S. side, shale activity is flattening. “We’re seeing layoffs,” says McClanahan, referencing anecdotal reports from the Permian Basin. Official data supports that trend, showing current production falling short of EIA forecasts.
The big picture? Despite few bullish catalysts, refined product strength and flat U.S. production could lift crude back above its recent $55 floor. “Crack spreads may narrow,” Hodes notes, “but that might be more about crude rising than diesel falling.”
For fuel buyers, traders, and risk managers, that means staying alert to refinery restarts, China’s demand curve, and shifting OPEC headlines. As always, StoneX will be watching—and helping clients prepare.
Explore the broader implications of tariffs, freight shifts, and trade retaliation on global energy flows in our latest white paper, “Tariffs, Tankers, and Tumbling Prices: The 2025 Oil Market Shake-Up.”
Key insights include:
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---Written by: Andrew Catsimanes, Copywriter
---Experts: Alex Hodes, Director of Energy Market Strategy and Trevor McClanahan, Energy Risk Manager
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