U.S. Rack ULSD Drops 22.3cts; Gasoline Falls 8.28cts


   
Miguel E. Andujar
DTN Refined Fuels Market Reporter

   DAVENPORT, FL (DTN) -- Wholesale rack prices for ultra-low sulfur diesel 
(ULSD) and gasoline moved lower Wednesday (4/15), reversing Tuesday's advance, 
as both physical and futures markets softened on renewed signs of diplomatic 
progress in the Iran conflict.

   Nationwide ULSD rack prices averaged $3.8415 gallon, down 22.28cts from 
Tuesday's $4.0643 gallon, according to DTN data. Conventional unleaded gasoline 
rack prices averaged $3.2325 gallon, down 8.28cts from $3.3153 gallon.

   Futures prices were mixed to slightly higher Wednesday morning after holding 
onto much of the sharp decline seen in the prior session. Front-month May NYMEX 
ULSD futures rose 5.62cts to $3.6805 gallon, while May RBOB gasoline futures 
slipped 1.70cts to $3.0239 gallon. WTI crude for May delivery edged up $0.24 to 
$91.50 bbl.

   Futures had come under pressure earlier as markets reacted to reports that 
U.S. and Iranian officials were moving forward with another round of 
negotiations aimed at a more lasting resolution to the conflict. That shift in 
tone has eased some of the immediate supply concerns that had supported prices 
earlier in the week, even as uncertainty remains around the outcome of those 
talks.

   Rack prices followed lower across all regions, reflecting a more direct 
adjustment in physical markets as sentiment shifted.

   ULSD racks declined across all regions Wednesday, with the largest drops in 
the Midwest and East Coast. Midwest ULSD fell 24.97cts to $3.6638 gallon, while 
East Coast prices declined 20.56cts to $3.8182 gallon. Gulf Coast values 
dropped 19.80cts to $3.7856 gallon, while Rocky Mountain prices fell 10.63cts 
to $4.1824 gallon. West Coast ULSD was reported at $4.6311 gallon, maintaining 
the strongest regional premium.

   Relative to the national ULSD rack average of $3.8415 gallon, PADD 5 held 
the widest premium at 78.96cts above the U.S. benchmark, followed by PADD 4 at 
34.09cts above. PADD 1 traded near parity with the national average, while PADD 
2 remained the deepest discount at 17.77cts below the benchmark, followed by 
PADD 3 at 5.59cts below.

   On conventional unleaded gasoline racks, all regions moved lower Wednesday. 
Midwest gasoline recorded the largest decline, falling 9.53cts to $2.7146 
gallon, while East Coast prices dropped 7.70cts to $2.9035 gallon. Gulf Coast 
values declined 7.36cts to $2.8982 gallon, while West Coast gasoline fell 
6.83cts to $3.8769 gallon, maintaining the only premium position. Rocky 
Mountain prices posted the smallest move, down 5.37cts to $3.1909 gallon.

   Compared with the national gasoline average of $3.2325 gallon, PADD 5 
remained the only region trading at a premium, at 64.44cts above the benchmark. 
All other regions held discounts, led by PADD 2 at 51.79cts below the national 
average, followed by PADD 3 at 33.43cts and PADD 1 at 32.90cts. PADD 4 traded 
just slightly below the national benchmark.

   Premium gasoline rack prices also declined across all regions, broadly in 
line with conventional gasoline. Midwest prices posted the largest drop, while 
West Coast premiums remained elevated at $4.2697 gallon.

   The move lower in both rack prices and futures points to a market reacting 
to the potential for easing supply disruptions as negotiations progress, even 
if a final outcome remains uncertain. At the same time, markets are closely 
watching today's U.S. Energy Information Administration weekly inventory report 
for signs on demand trends, particularly whether distillate and gasoline 
exports continue to move higher, which has been a key source of support for 
refined product pricing in recent weeks.

   Even with the recent pullback, underlying structure continues to signal a 
relatively tight prompt market, with ULSD backwardation holding above 17cts and 
RBOB above 7cts, suggesting near-term supply remains firm despite the softer 
price action.




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