Post by @nicholas_crown

The 3:2:1 crack spread is how the street measures refiner profitability. 2 barrels of gasoline plus 1 barrel of diesel, minus 3 barrels of crude. Divide by 3. That gives you the refiner's margin per barrel. The 42 in the formula converts gasoline and diesel from dollars per gallon to dollars per barrel. Front-month cracks near $70 per barrel are roughly triple the historical norm. Product prices are surging while crude lags. Refiners are capturing the widest windfall on record. Click THE LINK IN MY PROFILE to see the way we're trading this.