Crack Spreads

Thursday, 11 November 2010 08:36 Melissa Moore
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1. What is the Crack Spread ? Is it for Crude or Beans ?
A crack spread reflects the value added to a barrel of crude oil by cracking (its molecules) into its various products, 
although the more standard ones consider only primary the products gasoline and heating oil.

A crush spread reflects the value added to a bushel of soybeans by crushing into its products, soymeal and soyoil.


2.  Do you have access to historical crack spread charts ? Do you offer this service additionally?

Yes! We have Crack spreads in our MRCI Online Special Spread Charts subscriber section:

http://www.mrci.com/web/historical-charts/special-spread-charts.html
It is #57 & #58.

3. What is the formula to calculate a crack spread?
The formula to calculate a 2-1-1 crack spread is as follows:

spread = 0.42(HO + HU)/2 - CL

where HO and HU are in cents/gallon, and where CL is in dollars/barrel

Thus, the crack spread is expressed in dollars/barrel, the value added to a barrel of oil by refining into its products (similar to the crush spread).


Here’s a link to the CME web site where you can calculate the 3:2;1 crack spread: http://www.cmegroup.com/tools-information/calc_crack.html






Last Updated on Friday, 09 January 2015 05:42