A crack spread is a spread created in commodity markets by purchasing oil and offsetting the position by selling gasoline and heating oil.

An oil refinery is a facility that takes crude oil and distills it into various useful petroleum products such as gasoline, kerosene, or jet fuel.

Hengyuan Refining Co Bhd, a Bursa-listed refinery had seen its share price plunging today after delivering a loss-making quarter result. The company may also deliver an unsatisfactory result for Q4 2022 as the crack spread had been trading at a negative territory throughout October.

Investors could avoid substantial losses if they track the prices of the crack spread.