Crack Spread 101 (Part 3: Crack spread volatility)  Continued
from Part 2  Several commodity products depend on prices, which
means crack spreads are extremely volatile  As we’ve seen, crack
spreads can be extremely volatile. In the U.S. Energy
Information Administration’s (EIA) own words, “Because the 3:2:1
crack spread is a product of the interplay of three commodity
prices, each subject to different but interconnected supply and
demand balances, the range of values can vary widely. Product
supply shortages resulting from serious disruptions such as
hurricanes or other refinery or pipeline outages can cause large
spikes of short duration.”  As you can see in the graph above,
the Gulf Coast 3-2-1 crack has ranged from below $0.00 per
barrel at points to over $40.00 per barrel in just the past five
years. This variation makes a huge difference for refiners’
profits. The table below shows various measures of crack spread
levels, showing the standard deviations, averages, minimums, and
maximums of three benchma