Market brain · live regime
Single point of view · auto-classified
Extreme crack stress · airlines exposed
With USGC 3-2-1 crack at $42.18, the market is in an
EXTREME REFINERY MARGIN REGIME: refiners are highly
advantaged, while unhedged airlines face accelerating fuel cost pressure and
margin compression.
Dominant regime: Extreme crack stress
Primary risk: Airline EBIT compression
Primary beneficiary: Refiners vs. crude
Decision horizon: Next 3–6 months
USGC 3-2-1 crack
$42.18
Above $40 stress threshold
Jet fuel stress
HIGH
Cost pressure vs. 90d band
Airline EBIT impact
–2.4% margin
Unhedged fuel exposure
Airline view · fuel economics
Fuel costs are materially above budget; hedge coverage is below policy in a stress regime.
Priority is protecting EBIT and cash flow: increase jet fuel hedge coverage and extend tenor while cracks remain elevated.
Hedge need
INCREASE
Coverage below target
Time focus
Next 2–4 quarters
Forward curve extension
Market & crack overview
Brent / WTI / USGC crack · context for the regime
Layer · Data
Brent
$85.09
ICE · front month
WTI
$82.14
NYMEX · front month
USGC 3-2-1 crack
$42.18
95th percentile vs. 5y band
Intraday P&L
Cumulative · energy book
Crack risk & decision support
Live regime classification · impact · recommended action
Layer · Signal & decision
Crack spread risk monitor
EXTREME STRESS REGIME
USGC crack > $40: refinery margins very strong, airlines under significant fuel cost pressure.
Regime: Extreme
Momentum: Bullish refiners
Band: 95th percentile
Decision support panel
Recommended action
Increase jet fuel hedge coverage
Confidence
High · driven by crack > $40 regime
Expression
Long crack spreads · long refiners vs. crude · extend tenor
This is decision support, not an execution instruction. Desk can override based on
risk appetite, balance sheet, and policy constraints.
Scenario: Increase hedge
Alternative: Maintain
Alternative: Reduce (high risk)