CommoditiesMarket noteMonday 2 November 2026, 07:52
A crack spread is what refiners earn between crude oil and fuel. The 3-2-1 version hit a record $81.86 a barrel in September 2026; by 27 October it had halved.
A crack spread is the gap between the price of crude oil and the price of the fuels a refinery “cracks” out of it, in dollars a barrel. It is the market’s rough measure of what refiners earn before their costs. The most quoted version, the 3-2-1, assumes three barrels of crude make two of petrol and one of diesel. Worked out from New York Harbor spot prices against US crude, it stood at $41.18 a barrel on 27 October 2026, about half the record of $81.86 set on 25 September 2026.
Both figures are our calculation from the daily prices the US Energy Information Administration publishes for West Texas Intermediate crude, New York Harbor petrol and New York Harbor diesel. The diesel series starts in June 2006, so the record covers twenty years of daily data.
Crude is priced by the barrel and fuels by the gallon, and a barrel holds 42 gallons. So the fuel prices are first turned into barrels. Take 25 September 2026, the day of the record, from the EIA’s spot price tables:
The same sum works for one fuel at a time. The diesel crack spread is a barrel of diesel less a barrel of crude; the petrol crack spread, also called the gasoline crack, is the same for petrol. Traders also quote crack spreads from futures prices and for other places, such as the US Gulf Coast or Chicago, and other ratios, such as 5-3-2. The levels differ, but they move together. We use the EIA’s spot prices because anyone can check them and they go back two decades.
The 3-2-1 averaged $53.78 a barrel in October 2026 to the 27th, down from $68.22 in September, the highest monthly average in our series. July, August and September 2026 are the three highest months on record. Before this year, the top month was May 2022, at $62.68, when Russia’s invasion of Ukraine had upended the fuel trade.
The fall in October came from petrol, not diesel. The petrol crack dropped to $15.03 a barrel on 27 October, from $63.56 on 28 August. Petrol margins tend to ease after the summer driving season: from 2010 to 2025 the petrol crack averaged $22.74 in May and $19.45 in October. This year the drop was far larger than usual.
Diesel went the other way. The diesel crack spread reached $124.55 a barrel on 8 October 2026, the highest in the series and above the $118.74 of 11 May 2022. It was still $93.48 on 27 October. Its October average, $107.82, was second only to September’s $110.82.
At the pump this shows up as the gap between the two fuels. As we explained on 23 October, diesel costs about $2 a gallon more than petrol in the US, close to the widest on record, and the extra is almost all refining and distribution, not crude.
For most of the 2010s the 3-2-1 sat close to $20 a barrel: its average from 2010 to 2019 was $19.83. It fell to $11.27 in 2020, when lockdowns emptied roads and skies, and jumped to $43.27 in 2022. In 2026 to 27 October it has averaged $50.86, the highest of any year.
The war in the Middle East cut supply from the world’s biggest exporting region. In March the International Energy Agency said exports of crude and refined products through the Strait of Hormuz were below 10% of their level before the conflict, as it announced the largest stock release in its history. The 3-2-1 averaged $28.78 in February 2026 and $46.65 in March, the first full month of the war.
Refineries elsewhere cannot fill the gap quickly. In September we looked at the refiners in Africa and Asia that now make what the Gulf cannot sell. Diesel is the tightest of the fuels, which is why the International Energy Agency asked its members in October to release diesel stocks faster.
For refiners, a wide crack spread usually means fat profits. Shell said in its third-quarter update note of 7 October that its indicative refining margin was $42 a barrel in the third quarter of 2026, up from $24 in the second. Shell’s measure uses its own mix of crudes and products, so it is lower than the New York 3-2-1, but it moved the same way.
A crack spread is not a profit figure, though. It leaves out what a refinery spends on energy, staff, upkeep and transport, and refineries make more than petrol and diesel: jet fuel, heating oil, asphalt and chemicals. It measures the market, not one plant.
For drivers, the crack spread is the part of the pump price that is neither crude nor tax. The EIA splits the price of each gallon every month in its Gasoline and Diesel Fuel Update. In May 2026, refining made up 22% of the price of regular petrol and 25% of the price of diesel. When crack spreads are wide, that share grows, and pump prices can stay high even when crude oil falls.
The crack spread moves with the war, the seasons and refinery outages. Three things will set it this winter:
The EIA publishes its spot prices every weekday, a few days after the trading day.
This is analysis and opinion, not investment advice.
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