3-2-1 crack: 86 days over $10, 35 days over $12 (May 19)
86 consecutive days for crack spread over $10, 35 consecutive days over $12 so far. I believe that $20 for the crack spread in May and $25-30 in June and July 2010 are coming while gasoline imports will be going down due to the strong US dollar. Goldman Sachs, JP Morgan, Vanguard, Ameriprise and other big financial houses recently bought/are buying WNR stock and other refiners.
WNR was recently upgraded by RBC Capital and we can expect more upgrades in 2010. WNR should be making over $1.5 mil per day with the crack spread over $15.00 so 2-nd and 3-rd quarters 2010 look very promising to the shareholders.
I think you will. Wholesale RBOB Gasoline was $2.42 a gallon, 2 weeks ago and is now down to around $2 a gallon. You will see retail price adjustment pretty soon. You should start to see a slow downward move, which I believe has already commenced and the prices at the pump are adjusting downwards.
Right, so why will imports be down as a result of the strong dollar?
A. Does it not follow logic that cost of imports will be cheaper for an importing country if their currency strengthens against the exporting country currency, assuming that the goods are priced in the exporting country currency? This will normally be an incentive to import more at lower prices.
B. With regards to crude and gasoline, the price of crude as well as Gasoline imports are denominated in $$ anyway. Strengthening of $ vs other currencies should not impact the US at all in terms of reduced/increased imports, unless there is a price differential between import price and local production price. It will positively impact the exporting countries in that they will get more of their weakened currency as a result of the strong dollar.
...it's a combination of several factors...the main two factors are that crude for example in Europe is more expensive than WTI in the US...take into consideration much stronger dollar and increased shipping rates and you get the answer why gasoline imports from Europe must go down...there are more other factors to consider as well...