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

As we approach the summer season, the dynamics of gasoline and gasoil futures are becoming increasingly important. Despite geopolitical tensions in the Middle East, gasoline futures in the US are hovering near the  2.82 on April 16th. The lack of significant damage from recent military strikes and Tehran's downplaying of the situation have eased concerns of escalated warfare in the region, leading to expectations that oil trade will continue unimpeded. However, the situation remains fluid, with the potential for further conflict in the Middle East posing a risk to crude oil supplies. This, coupled with rising gasoline demand as we move into the summer months, could put upward pressure on prices. Data from the EIA shows that gasoline demand is edging higher, while stocks fell in the week ending April 12th. Despite this, supply remains ample as crude oil stocks rose significantly. The graph above shows the historical futures prices for RBOB Gasoline and NY Harbor ULSD for the past on...

Gasoline and gas oil markets are in the midst of rapid change as inventories dwindle and geopolitical tensions escalate. In the week leading up to March 29, gasoline inventories dipped by 4.3 million barrels, despite robust production averaging 10 million barrels per day (bpd). However, a subtle dip of 0.5% in motor gasoline product supplied over the past four weeks compared to the same period last year hints at a nuanced demand-supply equilibrium. Geopolitical unrest further complicates the situation. Recent strikes on Russian territories by Ukrainian forces, coupled with Houthi militant attacks in the Red Sea, have disrupted crude deliveries, necessitating diversions around the Cape of Good Hope. British intelligence estimates suggest that these assaults have disrupted up to 10% of Russia's refining capacity, intensifying concerns over supply stability. In response to these dynamics, RBOB Gasoline prices surged by 10% to $2.7720 per gallon, while NY Harbor ULSD climbed by 7.6% to...