MARKETWIRE ALERTS
Barani Krishnan
DTN Refined Fuels Market Reporter
MARKETWIRE ALERTS
MarketWire Afternoon News Aug 26th:
Updated at 5:00 PM ET
HEADLINES:
- Midwest Diesel Basis Up Broadly Amid Mixed Inventory Data
- Enbridge to Buy Salt Creek Crude Gathering Business
- EIA: PADD 5, Gasoline Stocks Hit Nearly 3-Month Low
- EIA: PADD 1 Diesel Stocks Hit 4-Year Low, Gasoline DN Too
- Analysis: U.S. Road Fuel Stocks Plummet to 18-Year Low
- EIA: PADD 3 Distillate Stocks Fall to 3-Month Low
- EIA: PADD 2 Crude to Product Inventories Up Across Board
- OPAL Boosts RNG/CNG Capacity at Goshen, CA, Station
- EIA: Ethanol Production Rises, Demand Stays Flat
- EIA: SPR Stocks Near 44-Year Low; Fuel Stocks Fall
- EIA: Propane/Propylene Stocks Rise, Up 17.8% on Year
NEWS
Midwest Diesel Basis Up Broadly Amid Mixed Inventory Data
Midwest spot diesel cash differentials edged higher Wednesday (8/26),
drawing support from a rally in NYMEX ULSD futures after federal data revealed
a sharp draw in overall U.S. distillate inventories.
Chicago ULSD traded at a 12cts discount to October NYMEX ULSD, narrowing
3.5cts on the day. Pipeline-connected diesel also firmed, with Buckeye Complex
and Wolverine Pipeline ULSD traded at a 12cts discount to October futures,
narrowing 2cts.
In contrast, Group 3 ULSD traded at a 14.5cts discount to October ULSD,
widening 1.5cts on the day.
Jet fuel differentials also traded mixed across the regional hubs, with
Chicago jet fuel widening 10cts on the day to trade at a 55cts discount to
October futures, while Group 3 jet fuel held flat at a 20cts discount.
The price action unfolded against an inventory report from the U.S. Energy
Information Administration showing a 2.2 million bbl drop nationwide in
distillate stocks to 103.4 million bbl for the week ended August 21. The same
report showed PADD 2 distillate fuel oil inventories rising by 200,000 bbl
during the reference week to reach 28.6 million bbl, placing regional stocks
500,000 bbl above year-ago levels.
An ongoing operational impasse on the 1,830-mile Explorer Pipeline following
an August 17 fire at its Glenpool tank farm in Tulsa, Oklahoma is complicating
basis pricing for Midwest fuel products.
Without clear guidance on when northward fuel transfers from PADD 3 into
PADD 2 will fully resume on the pipeline, physical spot traders were relying on
futures markets for direction, market participants said.
Front-month NYMEX ULSD futures settled up $0.0162 at $4.2600 gallon on
Wednesday.
Enbridge to Buy Salt Creek Crude Gathering Business
Enbridge announced Wednesday (8/26) that it will acquire Salt Creek
Midstream's crude oil gathering business, including 100% of the Orla and Wink
North systems and a 50% interest in the Delaware Crossing system for $600
million.
The business includes approximately 500 miles of crude oil gathering
infrastructure in the Delaware Basin, one of the most prolific and competitive
crude oil producing regions in North America, according to a company statement.
The transaction is expected to close later in 2026.
The system serves to more than 20 producers and is supported by nearly
320,000 net dedicated acres under long-term commercial agreements.
With an average remaining contract life of approximately 10 years, the
assets provide stable, long-term cash flows and a durable foundation for future
growth, Enbridge said.
The Orla, Wink North and DCX gathering systems have a combined 420,000 bpd
of throughput capacity and 350,000 bbl of storage capacity and can deliver into
multiple long-haul Permian crude egress pipelines including Enbridge's
majority-owned Gray Oak Pipeline.
The acquisition will provide a direct strategic connection between crude oil
production in the Permian Basin to export at Enbridge Ingleside Energy Center,
North America's largest crude export terminal.
"These assets will strengthen our value chain in the Permian Basin and
Enbridge can now offer customers full wellhead to water integration via Gray
Oak, Cactus II and the Enbridge Ingleside Energy Center," Colin Gruending,
Executive Vice President and President of Enbridge Liquids Pipelines said.
EIA: PADD 5, Gasoline Stocks Hit Nearly 3-Month Low
West Coast gasoline inventories fell to their lowest level in nearly three,
months, while jet fuel stockpiles climbed after a seven-consecutive-week draw
and distillates stocks dropped during the week ended August 21, the U.S. Energy
Information Administration (EIA) reported Wednesday (8/26).
Motor gasoline stocks in the PADD 5 region dropped by 100,000 bbl to 26.4
million bbl during the referenced week, the EIA's Weekly Petroleum Status
Report showed. That was the lowest level since June 5 when it was 27.35 million
bbl. Year-over-year, the same product inventory was below the 30.2 million bbl
reported during the same week last year.
PADD 5 gasoline imports rose to 91,000 bpd compared to zero barrels reported
the prior week, but they were below 125,000 bpd recorded a year earlier.
Regional distillate fuel stockpiles fell by 400,000 bbl to 10.6 million bbl
from the prior week and were below levels from the same week of a year earlier.
Distillate imports in the same region rose by 14,000 bpd to 26,000 bpd on the
week, above the 9,000 bpd imported a year earlier.
Jet fuel stocks in PADD 5 rose by 500,000 bbl to 11.1 million bbl, following
a 7-week consecutive decline and they were below the previous year's level of
11.4 million bbl. Jet fuel imports in PADD 5 plummeted to 14,000 bpd from
75,000 bpd on a weekly basis and from the 72,000 bpd imported during the same
week last year.
Crude oil inventories in PADD 5 rose by 900,000 bbl to 44.4 million bbl
during the week profiled, above the 45 million bbl reported for the same week
of the prior year. Crude imports dipped to 826,000 bpd from 1.44 million bpd
last week; they were also below the 1.43 million bpd recorded a year earlier.
PADD 5 refiner crude inputs increased by 50,000 bpd on the week to 2.041
million bpd, down 190,000 bpd compared with the 2.231 million bpd reported a
year ago.
Regional refinery utilization rose to 93.7% from 92.2% the previous week,
EIA data showed.
EIA: PADD 1 Diesel Stocks Hit 4-Year Low, Gasoline DN Too
U.S. East Coast distillate stocks hit a four-year low last week, while motor
gasoline, distillate and jet fuel inventories declined too, the Energy
Information Administration (EIA) reported Wednesday (8/26).
Crude oil stocks, meanwhile, rose, along with refinery utilization during
the week ended August 21, the EIA said its EIA's Weekly Petroleum Status Report.
Distillate inventories on the East Coast dropped by 1.2 million bbl to 21.0
million bbl during the profiled week, standing 7.9 million bbl below the 28.9
million bbl reported during the same week last year. EIA historical data showed
the stock level for the week ended August 21 to be the lowest for PADD 1
distillates since the week to May 27, 2022, when inventories then stood at
20.97 million bbl.
Motor gasoline stocks in PADD 1 fell by 100,000 bbl to 52.3 million bbl
during the reference week, even as they remained 2.7 million bbl below the 55.0
million bbl recorded during the same week last year. Gasoline imports into the
region increased to 433,000 bpd from 242,000 bpd the previous week but remained
below the 550,000 bpd reported during the comparable week of 2025.
Jet fuel inventories decreased by 300,000 bbl to 11.0 million bbl during the
reference week but were 900,000 bbl above the 10.1 million bbl reported during
the comparable week in 2025. East Coast jet fuel imports averaged 13,000 bpd,
flat with the previous week and matching the 13,000 bpd imported during the
comparable week of 2025.
Crude oil inventories on the East Coast built by 600,000 bbl to 8.4 million
bbl during the week profiled and were 400,000 bbl above the 8.0 million bbl
reported during the same week last year. Crude imports into the region averaged
653,000 bpd, up from 472,000 bpd the previous week and above the 583,000 bpd
reported during the comparable week of 2025.
Refinery utilization on the East Coast increased to 86.7% of operable
capacity from 84.8% the previous week, while crude oil inputs increased by
13,000 bpd to 797,000 bpd, EIA data showed.
Analysis: U.S. Road Fuel Stocks Plummet to 18-Year Low
Combined inventories of total motor gasoline and distillate fuel oil fell to
their lowest level during the week of August 21, since September 2008, U.S.
Energy Information Administration data released Wednesday (8/26) showed.
Steep backwardation on the front-end of ULSD and RBOB futures forward
curves, indicative of near-term supply tightness, continued to disincentivize
storage, with high international demand for U.S. refined fuels diverting
barrels onto the export market instead.
Nationwide gasoline inventories fell by 2.5 million bbl to a nine-month low
206.8 million bbl in the week ending August 21, down 7% year-on-year and 6%
below the five-year seasonal average.
Gasoline stocks have since mid-May followed typical seasonal patterns, first
increasing along with refiner activity until the pickup in summer driving
demand overtook the rise in domestic gasoline production.
However, this followed months of inventories plummeting at a much faster
pace than usual amid the sudden refined product supply shock caused by the
closure of the Strait of Hormuz and the subsequent trough in global refining
activity. U.S. gasoline inventories, hovering some 4.3% above the five-year
seasonal average in early February, by mid-May found themselves 5.6% below it.
Over these 15 weeks, the draw rate averaged 452,000 bpd, nearly twice as fast
as the five-year average 229,000 bpd.
Diesel inventories, in contrast, have over the past months registered
counter-seasonal declines amid a persistently elevated export pace. Distillate
fuel oil stocks last week fell 2.2 million bbl to 103.4 million bbl, down 9.5%
year-on-year, and trailing the five-year seasonal average by 14.4%. Over the
past four weeks, they shrank by 7.24 million bbl, or at a rate of 259,000 bpd.
This coincided with exports running 400,000 bpd above year-ago levels at
more than 1.8 million bpd.
his rapid depletion in road fuel inventories came despite refiners
processing the most crude oil since 2019 and high retail prices chipping away
at domestic demand growth.
Four-week average net inputs of crude oil were up nearly 200,000 bpd
year-on-year, while refined product exports registered a 1.18 million bpd
year-on-year increase.
EIA: PADD 3 Distillate Stocks Fall to 3-Month Low
U.S. Gulf Coast (PADD 3) distillate fuel inventories fell to a more than
three-month low during the week ended August 21, while jet fuel stocks dropped
to a three-month low and gasoline inventories declined, according to the U.S.
Energy Information Administration's Weekly Petroleum Status Report released
Wednesday (8/26).
Distillate fuel oil inventories, the feedstock for diesel, fell by 1 million
bbl to 39.6 million bbl during the profiled week, the lowest level since the
week ended May 8, when stocks stood at 39 million bbl. Inventories were 3.1
million bbl below the 42.7 million bbl reported during the same week last year.
As a net exporter of distillate fuel, PADD 3 reported no distillate imports
during the reporting week.
Jet fuel inventories fell by 600,000 bbl to 14.8 million bbl during the
reference week, the lowest level since the week ended May 15, when stocks stood
at 14.3 million bbl. Inventories remained 900,000 bbl above the 13.9 million
bbl reported during the same week last year. The Gulf Coast reported no jet
fuel imports during the reporting week.
Motor gasoline inventories in the PADD 3 region fell by 2.3 million bbl to
77.2 million bbl during the reference week, reversing the previous week's 2.2
million bbl build. Inventories remained 6.7 million bbl below the 83.9 million
bbl reported during the same week last year. Gasoline imports into the Gulf
Coast averaged 7,000 bpd, down from 72,000 bpd the previous week and below the
55,000 bpd reported during the comparable week of 2025.
Crude oil inventories in PADD 3 fell by 2.2 million bbl to 251.4 million bbl
during the reference week following two consecutive weekly builds. Inventories
were 11.6 million bbl above the 239.8 million bbl reported during the same week
last year. Crude oil imports into the Gulf Coast averaged 1.736 million bpd, up
from 1.583 million bpd the previous week and above the 1.147 million bpd
reported during the comparable week of 2025.
Refinery utilization on the Gulf Coast fell to 97% of operable capacity from
97.9% the previous week, while crude oil inputs into refineries averaged 9.520
million bpd, down from 9.619 million bpd the week before, EIA data showed.
EIA: PADD 2 Crude to Product Inventories Up Across Board
Midwest oil inventories rose across the board last week, with crude stocks
leading the build and gasoline and distillate balances increasing evenly, the
Energy Information Administration (EIA) reported Wednesday.
Crude oil stocks grew by 800,000 bbl to 101.2 million bbl, the EIA's Weekly
Petroleum Status Report for the week ended August 21 showed. That inventory
level was still 2.5 million bbl lower than last year's level of 103.7 million
bbl, the EIA data showed.
Crude imports into the PADD 2 region decreased by 86,000 bpd on the week to
average 2,579,000 bpd. This inbound crude oil volume was 168,000 bpd lower than
the 2,747,000 bpd reported by the agency during the corresponding week last
year.
Distillate fuel oil inventories rose by 200,000 bbl -- similar to gasoline
-- to reach 28.6 million bbl for the week. The build placed regional distillate
inventories 500,000 bbl higher than the 28.1 million bbl logged during the
corresponding week last year.
Distillate imports into the Midwest averaged 4,000 bpd, down 12,000 bpd on
the week but up by 1,000 bpd from the year-ago volume of 3,000 bpd.
Jet fuel stocks rose by 100,000 bbl from the prior week to 8.1 million bbl,
standing 600,000 bbl above the previous year's level of 7.5 million bbl. Weekly
jet fuel imports into the region remained flat at zero bpd, matching both
week-ago and year-ago levels.
Refiner use of crude in the Midwest stood at 4.356 million bpd last week,
versus 4.329 million the week prior and 4.133 million a year ago. The regional
utilization rate rose to 101.8% versus the prior week's 101.2% and surpassed
the year-ago level of 97.5%.
OPAL Boosts RNG/CNG Capacity at Goshen, CA, Station
OPAL Fuels announced Wednesday (8/26) that it has expanded its fueling
station in Goshen, California, which is expected to deliver nearly 14 million
gasoline gallon equivalents of Renewable Natural Gas (RNG)/Compressed Natural
Gas (CNG) over the next decade.
The upgrade adds 1.7 million gasoline gallon equivalents of new capacity and
enables Premier Ag Transportation Inc. to join the station's growing customer
base, alongside Western Milling and ten other commercial and regional fleet
operators, according to a company statement.
The Goshen station is projected to displace approximately 1.3 million
gallons of diesel annually, reducing emissions from heavy-duty trucks on local
roads.
OPAL Fuels acquired the station in 2025 and completed extensive improvements
through 2026, transforming an underutilized asset into a public-access fueling
hub serving heavy-duty fleets across California's Central Valley.
"RNG is a compelling example of the circular economy in action, transforming
waste into a valuable low-carbon fuel for the trucks that help move goods,"
said Adam Comora, Co-Chief Executive Officer of OPAL Fuels.
EIA: Ethanol Production Rises, Demand Stays Flat
The Energy Information Administration reported on Wednesday (8/26) that
overall ethanol production in the United States averaged 1.112 million bpd in
the week ending August 21, up 23,000 bpd week-on-week and 42,000 bpd, or 3.9%
higher than in the same week last year. Four-week average output at 1.106
million bpd was 27,000 bpd above the same four weeks last year.
Midwest ethanol production averaged 1.062 million bpd, up 31,000 bpd
week-on-week and 45,000 bpd, or 4.4% higher than in the same week last year.
Four-week average output at 1.05 million bpd was 28,000 bpd above the same four
weeks last year.
Ethanol blending activity in the U.S. averaged 923,000 bpd, down 3,000 bpd
week-on-week and 9,000 bpd, or 1% lower than in the same week last year.
Four-week average blending demand at 925,000 bpd was 2,000 bpd below the same
four weeks last year.
Blender inputs at the East Coast were down 11,000 bpd on the week while
inputs in the Midwest were unchanged from last week, up 6,000 bpd on the Gulf
Coast and up 3,000 bpd on the West Coast.
Domestic ethanol inventories ended the week at 25.206 million bbl, up 85,000
bbl week-on-week and 2.657 million bbl, or 11.8% higher than in the same week
last year.
East Coast PADD 1 inventories ended the week at 7.252 million bbl, down
142,000 bbl week-on-week and 418,000 bbl, or 6.1% higher than in the same week
last year.
Midwest PADD 2 inventories ended the week at 10.045 million bbl, up 299,000
bbl week-on-week and 1.051 million bbl, or 11.7% higher than in the same week
last year.
Gulf Coast PADD 3 inventories ended the week at 5.116 million bbl, down
160,000 bbl week-on-week and 1.098 million bbl, or 27.3% higher than in the
same week last year.
West Coast PADD 5 inventories ended the week at 2.464 million bbl, up 96,000
bbl week-on-week and 92,000 bbl, or 3.9% higher than in the same week last year.
EIA: SPR Stocks Near 44-Year Low; Fuel Stocks Fall
U.S. Strategic Petroleum Reserve stocks declined further during the week
ended August 21, remaining at their lowest level in nearly 44 years, while
commercial crude oil inventories were virtually unchanged, according to Energy
Information Administration data released Wednesday (8/26). Gasoline, distillate
fuel and jet fuel inventories declined.
Strategic Petroleum Reserve inventories fell by 3.7 million bbl to 289.7
million bbl during the reference week, extending their decline after falling to
their lowest level since December 1982 the previous week. The current inventory
represents about 40.6% of the reserve's total 714 million bbl storage capacity.
SPR inventories were 114.5 million bbl, or 28.3%, below the same week last
year, EIA data showed.
Commercial crude oil inventories increased by 100,000 bbl to 428.9 million
bbl during the profiled week, essentially unchanged from the previous week, and
were 10.6 million bbl, or 2.5%, above the same week last year. Crude oil
imports averaged 6.158 million bpd, down by 435,000 bpd from the previous week.
Over the last four weeks, crude imports averaged 6.572 million bpd, up 2.6%
from the same period last year. Crude oil exports averaged 3.792 million bpd
last week, down from 4.066 million bpd the previous week and below the 3.810
million bpd reported during the comparable week last year.
Total motor gasoline inventories fell by 2.5 million bbl to 206.8 million
bbl during the week profiled and were 15.5 million bbl, or 7%, below the same
week last year. Gasoline imports averaged 565,000 bpd compared with 366,000 bpd
the previous week and 767,000 bpd during the comparable week last year.
Gasoline exports averaged 890,000 bpd versus 852,000 bpd the previous week and
714,000 bpd during the comparable week last year.
Distillate fuel inventories fell by 2.2 million bbl to 103.4 million bbl
during the reference week and were 10.9 million bbl, or 9.5%, below the same
week last year. Distillate imports averaged 176,000 bpd compared with 109,000
bpd the previous week and 141,000 bpd during the comparable week last year.
Distillate exports averaged 1.790 million bpd versus 1.601 million bpd the
previous week and 1.473 million bpd during the comparable week last year.
Jet fuel inventories fell by 500,000 bbl to 45.7 million bbl last week but
remained 2.1 million bbl, or 4.8%, above the same week last year. Jet fuel
imports averaged 28,000 bpd compared with 89,000 bpd the previous week and
85,000 bpd during the comparable week last year. Jet fuel exports averaged
359,000 bpd versus 372,000 bpd the previous week and 111,000 bpd during the
comparable week last year.
Refinery utilization increased to 97.4% of operable capacity last week from
97.2% the previous week. Crude oil inputs into refineries averaged 17.393
million bpd, essentially unchanged from 17.395 million bpd the previous week,
EIA data showed.
EIA: Propane/Propylene Stocks Rise, Up 17.8% on Year
The Energy Information Administration reported on Wednesday (8/26) total
domestic propane/propylene stocks of 109.483 million bbl in the week ending
August 21, up 2.47 million bbl week-on-week and 16.511 million bbl, or 17.8%
higher than in the same week last year.
Data show propane/propylene exports last week averaged 2.018 million bpd,
down 23,000 bpd week-on-week and 286,000 bpd, or 16.5%, higher than in the same
week last year.
Implied demand for propane/propylene in the United States averaged 631,000
bpd, down 53,000 bpd week-on-week and 323,000 bpd, or 33.9% lower than in the
same week last year.
EIA reports domestic propane/propylene production averaged 2.921 million bpd,
up 10,000 bpd week-on-week and 86,000 bpd, or 3% higher than in the same week
last year.
East Coast PADD 1 inventories ended the week at 8.141 million bbl, down
148,000 bbl week-on-week and 242,000 bbl, or 3.1% higher than in the same week
last year.
Midwest PADD 2 inventories ended the week at 26.644 million bbl, up 490,000
bbl week-on-week and 1.97 million bbl, or 8% higher than in the same week last
year.
Gulf Coast PADD 3 inventories ended the week at 69.608 million bbl, up 1.789
million bbl week-on-week and 14.13 million bbl, or 25.5% higher than in the
same week last year.
Combined inventories in the Rockies and the West Coast, PADD 4 and 5, ended
the week at 5.09 million bbl, up 338,000 bbl week-on-week and 169,000 bbl, or
3.4% higher than in the same week last year.
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