Definitions for "Crack Spread"
The spread between crude oil and it's products: heating oil and unleaded gasoline plays a major role in the trading process.
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Is the purchase of crude oil against the sale of the refined products. In futures trading, it is the simultaneous purchase of crude oil futures versus the sale of heating oil and gasoline futures. The spread differentials reflect the potential refining margins or profitability. The spread computes the cost of the raw commodity input, crude oil, and its refined products, gasoline and heating oil. Compare to Reverse Crack Spread.