Here's the chart via BarChart:
As you can tell, the refiners have been profitable and getting more so as feedstock costs dropped faster than product price.
Van Eck Global Launches Market Vectors® Oil Refiners ETF (CRAK)The ETF began trading on the 19th at $19.65. and closed today at $17.75 -0.83 so there's probably some upside just on a bounce but I'd be very careful should oil prices start to show some life (which we expect).
Van Eck Global has launched the Market Vectors Oil Refiners ETF (NYSE Arca: CRAK), the first U.S.-listed ETF to offer pure-play exposure to global oil refiners.
CRAK seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Market Vectors Global Oil Refiners Index (ticker: MVCRAKTR). To be included in the index, companies must generate at least 50% of their revenues from crude oil refining and meet certain size and liquidity requirements.“The profitability of refiners is generally influenced by the spread between the cost of crude oil and the prices at which refined products can be sold, commonly known as crack spreads”
“The profitability of refiners is generally influenced by the spread between the cost of crude oil and the prices at which refined products can be sold, commonly known as crack spreads,” said Brandon Rakszawski, product manager at Van Eck Global. “Oil refiners have tended to react differently to the price of oil compared to other energy sector companies. Historically, the return profile is differentiated from other segments of the sector, a trend that has persisted year-to-date.”
Van Eck notes that an investment in CRAK incurs risks associated with refining companies, such as changes in commodity prices, exchange rates and the price of oil and gas, government regulations, the imposition of import controls, and natural disasters, all of which may adversely affect the Fund...MORE
Here's Scotia Howard Weil's most recent Weekly Refining Indicators Report.
