Gasoline Holds Near 3-½ Year Peak

US gasoline futures held above $2.90 per gallon, remaining near their highest level since July 2022, as investors braced for further upheaval in the Middle East. President Donald Trump threatened Iran with additional attacks after Iran’s new Supreme Leader Mojtaba Khamenei warned that the Strait of Hormuz would remain closed and could open other fronts if US and Israeli strikes continue. Meanwhile, the US is trying to ease supply concerns by issuing a 30-day license allowing countries to buy Russian oil and petroleum products stranded at sea. Treasury Secretary Scott Bessent also called for an international coalition to escort tankers through the Strait of Hormuz “as soon as militarily possible.” This follows coordinated IEA efforts to release unprecedented reserves, which have done little to slow the energy rally. For the week, gasoline is on track for a second consecutive gain.

US gasoline futures surged over 5% to trade above $2.93 per gallon, the highest since July 2022 as markets reacted to the worsening maritime crisis in the Persian Gulf. Mojtaba Khamenei, the new Iranian supreme leader, declared that the Strait of Hormuz should stay closed to pressure international rivals. While the International Energy Agency launched its largest-ever coordinated release of 400 million barrels from emergency reserves, the gesture has failed to calm traders who fear the 20% loss of global trade cannot be offset by stockpiles alone. Fresh projectile strikes on oil tankers in Iraqi waters and near Jebel Ali have further discouraged commercial traffic and reinforced bets that a near-term resolution is unlikely. Gulf producers have already slashed output as storage capacity reaches its limit while U.S. officials maintain they are not yet prepared to escort tankers through the conflict zone.

US gasoline futures continued their rally, rising more than 3% to around $2.9 per gallon, approaching the four-year high reached earlier this week, as markets remained focused on developments in the Iran war. Iran has told regional mediators it will only consider a ceasefire if the US guarantees that neither Washington nor Israel will strike it again, a condition the US is unlikely to accept, dimming prospects for a near-term resolution. The conflict has caused major disruptions to global oil supplies, with the Strait of Hormuz largely inaccessible. Gulf producers have already cut output by roughly 6%, with further reductions possible. This has overshadowed global efforts to ease surging crude and fuel prices, with the International Energy Agency launching a coordinated release of 400 million barrels from emergency reserves, the largest drawdown on record, including 172 million barrels from the US and 80 million barrels from Japan.