California CARB ULSD prices hit multi-year lows

Outright California CARB diesel prices are at nearly 31-month lows following a narrowing in Los Angeles differentials and the underlying Nymex ultra-low sulphur diesel (ULSD) contract last week.

Front-month outright prices in Los Angeles closed at $2.20/USG on 2 August, the lowest level since December 2021, after a 4pc downturn in the Nymex ULSD contract and a 2¢/USG weekly dip in differentials as August volume was heard traded lower.

Overall ULSD liquidity remained muted in San Francisco, but Friday's Nymex loss pressured outright cash prices to $2.14/USG, also the lowest level since December 2021.

California refiners had nearly doubled CARB diesel production in the week ended 26 July and averaged 193,000 b/d, according to latest data from the California Energy Commission (CEC) released on 1 August. The uptick fueled a 1.6pc increase in the state's total diesel inventory, to 2.9mn bl, despite a concurrent 38pc drop in output of other diesel fuels — a category including high-sulphr, non-California EPA and renewable diesel.

By Jasmine Davis