Coronavirus Lockdown Is Even More Bad News for Diesel
- Fuel’s premium over crude has collapsed in Europe, Asia, U.S.
- Jet fuel market has weakened too as people take fewer flights
Health professionals check the temperature of a driver at a screening checkpoint on the outskirts of Shanghai on Jan. 28.
Photographer: Qilai Shen/BloombergThis article is for subscribers only.
Add a severe global pathogen to the list of bad news for diesel.
Two metrics for the industrial fuel that traders watch closely -- its premium against crude, and a gauge of supply and demand -- have collapsed this year. For the most part, the rout has been about weaker-than-expected buying from the shipping industry and a mild winter. The novel coronavirus in China, though, has exacerbated the slide because it’s meant a clampdown on travel that’s negative for fuel demand, and a weakening of investor sentiment across assets.