China was the news today as the tremors caused by the report that lending in China may slow down and thus slow down economic activity in the world's second largest energy user. More telling about where the economy is headed is the report on crack spreads. Crack spreads have fallen to $6.58 down 30% from this year's high and are not forecasted to go above $10. This is definitely the story on demand. It is not just national demand but international demand as the spot prices are most affected by the cost of the final 10% bought every day, If the international economy is hurting demand, prices will fall.
Crude and product both fell substantially today. Gasoline wasn't able to bring crude up for the summer. Will distillate demand for the winter be able to bring the price of crude up?
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