Platts assesses Gulf Coast ULSD above $5/gal for first time
Platts, part of S&P Global Energy, assessed US Gulf Coast ultra low sulfur diesel at $5.0125/gallon on Sept. 10, its highest value since the assessment began in May 2006, eclipsing the previous high of $4.816/gal set the day before. The 19.65-cent/gal increase was driven by a rally in the underlying NYMEX October ULSD futures contract, ...
Platts reported that the Gulf Coast ultra low sulfur diesel (ULSD) reached a record high price of $5.0125 per gallon on September 10, surpassing its previous peak of $4.816 per gallon. This price increase of 19.65 cents per gallon was primarily driven by a rally in the underlying NYMEX October ULSD futures contract, which broke the $5 per gallon barrier and climbed to $5.0575 per gallon.
The surge in prices was attributed to escalating tensions between the US and Iran, as well as concerns over tightening physical supply, which kept a risk premium firmly in the market.
Interestingly, the hurricane risk factor, which typically plays a significant role in ULSD prices, was largely absent from the discussion, as per market participants. The US Gulf Coast experienced a mild hurricane season thus far, with only five named storms and no hurricanes, according to the US National Hurricane Center. This lack of hurricane activity has prevented refineries from building up a stockpile of diesel that could absorb any potential supply shock from a hurricane, leaving the market vulnerable.
Despite the record-high diesel prices, the tight supply situation persisted, even with US refineries operating at high levels. Diesel remains the refined product with the highest crack spread, meaning refiners are strongly motivated to maximize its production. US domestic diesel production reached a record high of 5.11 million barrels per day during the week ending September 4, surpassing the previous record set in July.
Additionally, diesel refinery product yield increased by 1.1 percentage points week on week to 30.4%, highlighting the industry's shift towards diesel production.
Platts recorded the highest prompt pipeline ULSD West Texas Intermediate (WTI) front-month crack price at $102.187 per barrel on September 10, marking a new record since the company began publishing assessments in 2009. Despite the record-high prices for Gulf Coast ULSD, export arbitrage opportunities to Northwest Europe remained viable, with a $3 per barrel incentive on September 9, according to the latest Refined Products ArbFlow Report.
US average exports in 2026 are already projected to be 10% higher than in 2025, according to data from the Energy Information Administration (EIA). Refinery utilization in 2026 has averaged 93.5% of capacity, up from 90.7% in 2025, with some refiners, such as PBF Energy Inc., even postponing maintenance to capitalize on the strong margins.
The data shows that the 30-day load pace for gasoil and diesel has reached a record high of 53.3 million barrels, with September alone seeing 17.8 million barrels loaded, setting the stage for potentially surpassing August's record exports if export incentives continue to persist.
Written by urgent.news from Hellenic Shipping News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
