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Crack Spread

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Last Updated on: 11th February 2021, 03:30 pm

The crack spread refers to the difference between the price of crude oil and the prices of refined products. The typical spread ratio is to buy 3 crude oil contracts and sell 2 gasoline contracts plus 1 heating oil contract (3:2:1).

This price difference represents the yield of “cracking” 1 unit of crude oil.

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