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European and US diesel futures traded at their highest levels since January, with Asian prices also rising. Diesel strength outpaced the recovery in crude prices during an unusual summer rally.
The article links the rise to supply tightness and heat waves, adding to inflation pressure as central banks weigh rate decisions.
Diesel strength raises the cost of hauling feed ingredients and grain, which can widen basis and delivered costs for livestock producers. Persistent energy inflation also affects the rate and currency backdrop for commodities.
bloomberg.comChunzi Xu, Alex Longley, Yongchang ChinAug 1, 2023After 105 past bullish macro events, ULSD / Diesel moved a median -0.4% over 5 sessions (45% higher; middle half -3.4% to +1.8%), and +1.2% over 20.
After 487 past bullish macro events, Crude Oil (WTI) moved a median +1.0% over 5 sessions (60% higher; middle half -2.0% to +4.0%), and +1.5% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
