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2018 has been a turbulent year thus far for the share price of HRC. However, is the same turbulence seen in the operations of HRC? In this article, lets attempt to estimate the profitability of HRC in the 1st Quarter of 2018.

In estimating sales, cost of goods sold and gross profit of HRC for Q1 2018, the 3:2:1 Crack Spread approach is highly popular and favoured. This widely used crack spread ratio is based upon the premise that 3 barrels of crude oil produce 1 barrel of gasoil (diesel) and 2 barrels of gasoline (petrol).

a. Sales Price
The daily historical data of the followings were obtained from CME Group's website for the quarter from 1 January 2018 to 31 March 2018:
- Singapore Gasoil (Platts)
- Singapore Mogas 95 Unleaded (Platts)