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As the stock market surges to new all-time highs, one indicator we watch closely hit a 52-week low today, which is a good thing. The chart below shows the spread between Brent and WTI crude oil prices over the last year. After widening out to the low 20s in the last several months, the spread has now collapsed all the way down to $10.62, which is a 52-week low.

Why do we care about the spread between Brent and WTI crude oil? The answer is that gasoline prices have a much closer correlation to prices of Brent crude oil, so when the premium of Brent crude narrows relative to WTI, it acts as downward pressure on the price of gasoline.

(click to enlarge)

Source: Brent-WTI Spread Drops To A 52-Week Low