Gasoline Holds Near Four-Month High

US gasoline futures held above $3.50 a gallon, its highest level since May 21st, as uncertainty surrounding the Strait of Hormuz remained elevated. The Iranian President Pezeshkian stated his opposition to restrictions on Iran’s civilian nuclear program and US military presence in the Middle East. Meanwhile, as winter approaches and heating demand rises, refiners are shifting output toward higher-priced diesel, tightening gasoline markets, while EIA data showed US gasoline inventories unexpectedly declined by 1.7 million barrels in the week ending September 18th. Persistent Ukrainian attacks on Russian refining infrastructure have also contributed to elevated prices, with Russia is set to extend its diesel export ban beyond September. However, fears over prolonged disruptions to the East-West pipeline eased following reports that Saudi Arabia had begun testing the pipeline, while the Iranian president stated that he remained open to diplomatic talks with the US.

US gasoline futures held above $3.45 a gallon, near its highest level since May 21st, following President Trump's remarks at the UN on the conflict with Iran. The President stated that a deal with Iran could be reached after the US midterm elections. Earlier in the session, Iran had proposed reopening shipping through the Strait of Hormuz within seven days, although contingent on the US lifting its blockade. Meanwhile, the crack spread rose to record highs amid widening refining margins due to rising refined fuel prices. As winter approaches and heating demand rises, refiners are shifting output toward higher-priced diesel, tightening gasoline markets. Persistent Ukrainian attacks on Russian refining infrastructure have also contributed to elevated prices, with several refineries either fully or partially shut down. As a result, Russia is set to extend its diesel export ban beyond September.

US gasoline futures fell to around $3.40 a gallon, extending losses for a second consecutive session, after reports that Iran proposed reopening Strait of Hormuz shipping within seven days, contingent on the US lifting its blockade. The statement bolstered hopes for a conflict resolution as President Trump is set to address the UN General Assembly on Tuesday, where Iranian President Pezeshkian will also attend. Fears over prolonged disruptions to Saudi Arabia's East-West pipeline also abated following reports the critical line is under testing and could partially restart this week. Meanwhile, the crack spread hit record highs as refining margins widened amid rising refined fuel prices. As winter approaches and heating demand rises, refiners are shifting output toward higher-priced diesel, tightening gasoline markets. Persistent Ukrainian attacks on Russian refining infrastructure have further supported elevated prices, with Russia set to extend its diesel export ban beyond September.