In the Pipeline: Insights on Gas Oil and Gasoline Prices Amidst Shifting Demand and Supply.

As depicted in the graph below, gasoline and gas oil futures prices have been on the rise since December 2023, with increases of 12% and 11% respectively. This can be attributed to geopolitical tensions, including the bombing of Russian petroleum refineries by Ukraine, the US's targeting of an Iraq militant commander, and attacks by Iran-affiliated groups in the Red Sea. These tensions have disrupted petroleum supply lines, driving prices up. Historical futures prices for gas oil and gasoline,Year-to-Date. Furthermore, the futures prices for March contracts for gasoline and gas oil, closely linked to crude oil prices, have been bolstered by a decrease in crude oil inventory levels. Data from the US Energy Information Administration shows a 3.44% drop in crude oil stock levels compared to last year. Additionally, in November 2023 OPEC+ agreed to voluntarily decrease oil production by 2.2 million barrels per day, further tightening supply amid rising demand. Despite optimistic econom...