Gasoline Futures Rise

US gasoline futures edged up to $2.64 per gallon but remained close to an eight-month low, as traders weighed Middle East tensions against recovering inventories. EIA data showed gasoline stocks rose by 1.8 million barrels in the week ending November 6, lifting domestic supplies to 1% above seasonal norms for the first time since April. Seasonal declines in driving demand ahead of winter and near-capacity refinery operations have supported the recovery. Still, uncertainty over a prolonged US-Iran conflict remains an upside risk. President Trump has downplayed the need for a deal with Iran, further dampening hopes of an imminent resolution, although crude continues to flow through the waterway. A shift by US refiners away from gasoline towards higher-margin middle distillates, alongside seasonal refinery maintenance, could further constrain supply. Escalating Ukrainian attacks on Russian refineries and lower Chinese exports are also contributing to tighter global fuel markets.

US gasoline futures traded around $2.60 per gallon, remaining near their lowest level since early March, as investors assess the outlook for the ongoing conflict between the US and Iran. Persistent attacks on shipping in the Strait of Hormuz dampened hopes of de-escalation, although crude oil continues to flow through the waterway. Domestic gasoline supplies, however, remain tight and below seasonal norms since late April. As a result, the EIA raised its 2027 forecast for average US retail gasoline prices to $3.73 per gallon. Reduced driving demand heading into winter has supported a partial recovery to inventories, while pump prices have fallen below $4 per gallon for the first time since July. However, a shift from US refiners away from gasoline towards higher-margin middle distillates and seasonal refinery maintenance could further contrain supply. Escalating Ukrainian attacks on Russian refineries and lower Chinese exports are also contributing to tighter global fuel markets.

US gasoline futures traded around $2.60 per gallon, near their lowest level since early March, amid expectations of further diplomatic efforts in the Middle East. US President Trump’s remarks that extensive strikes on Iran were “highly unlikely” reduced expectations for renewed attacks on Tehran. However, supply concerns persist while attacks in the region continue. Additionally, Ukraine struck Russia’s second-largest refinery, disrupting its gasoline and diesel production and raising questions over the agreement between Presidents Putin and Trump on supplying Russian diesel to global markets. In the US, inventories remain below seasonal norms, with EIA data showing a further decline of 222,000 barrels in the week ended October 30. The agency also expects US refiners to shift production away from gasoline towards higher-margin middle distillates, including diesel and jet fuel. Seasonal refinery maintenance could further tighten gasoline supplies.