Gasoline Prices Hit 9-Week Low

US gasoline prices dropped below $3 per gallon, reaching a nine-week low, weighed by hopes that the US and Iran are nearing a peace agreement that could end the war. Iran’s semi-official Mehr News Agency reported that a 14-point draft agreement between the US and Iran includes provisions for the lifting of oil sanctions, although the proposal still requires approval from Iranian authorities. Separately, US President Donald Trump said a peace deal with Iran could be signed as soon as the weekend. The developments eased tensions following a recent military escalation and revived hopes that the Strait of Hormuz, which handles around one-fifth of global LNG flows, could gradually reopen. Meanwhile, EIA data showed gasoline inventories rose by nearly 0.2 million barrels in the first week of June, defying expectations of a 0.5 million barrel draw.

US gasoline prices fell to $3.0 per gallon, remaining volatile throughout the week as markets weighed shifting developments in the Middle East. President Donald Trump said a peace deal with Iran could be signed as soon as the weekend and called off planned airstrikes after talks with Tehran. The comments came despite earlier threats targeting Iran’s oil infrastructure, while hostilities between the US and Iran had escalated earlier in the week. The absence of firm agreements kept energy markets choppy, while raising concerns over extended supply disruptions. The Strait of Hormuz has remained largely constrained since March, handling roughly one-fifth of global oil flows. Meanwhile, EIA data showed gasoline inventories increased by nearly 0.2 million barrels in the first week of June, defying expectations of a 0.5 million barrel draw. Still, the modest build followed several weeks of steep declines, suggesting stocks had been drawing down quickly ahead of the summer driving season.

US gasoline prices extended gains above $3.10 per gallon, driven by concerns that the Iran war could continue and keep disrupting energy supplies as hostilities intensify. The US conducted strikes on multiple targets in Iran, with reports indicating that President Donald Trump warned of additional attacks unless an interim peace deal is reached. Iran was also reported to have carried out missile and drone strikes against US vessels operating in the Strait of Hormuz. These developments have heightened worries over prolonged military escalation and raised doubts about a durable peace agreement. Meanwhile, EIA data showed gasoline inventories rose by almost 0.2 million barrels in the first week of June, defying expectations for a 0.5 million barrel draw. However, this modest weekly build came after several weeks of sharp declines, indicating that inventories have been falling rapidly ahead of the summer driving season.