Diesel Backwardation Cracks Before Thanksgiving as Policy Signals Dim and China’s Buying Turns deeply Political
The short Thanksgiving week delivered a dramatic shift in distillates. The ICE gasoil Dec/Apr backwardation—nearly +$100/mt at its 18 November peak—has collapsed to +$36.25/mt today, a structural break that resets front-end sentiment across diesel, HVO, and SAF. Asian cash markets confirm the same adjustment: Singapore 10ppm gasoil diffs slipped again to +$1.90/bbl, refining margins softened to $23/bbl, and traders are weighing diversions eastward as freight costs climb. The prompt tightness that supported the October–November rally has faded quickly, and with holiday liquidity thinning, the curve is normalizing rather than signaling scarcity.
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