BAKU, Azerbaijan, September 13. Gasoline futures have fallen below USD 190 per gallon in early September 2024, reaching levels not seen since before the war in Ukraine in 2021, Trend reports via BMI, a Fitch Group company.
On September 6, gasoline front-month prices dropped to USD 189.6 per gallon, a sharp 14% decline from August 30, when prices stood at USD 221.2 per gallon. This continues a downward trend observed since April, when prices peaked at USD 282.2 per gallon, with a brief correction to USD 260.2 per gallon between June and July.
The decline in gasoline prices is partly driven by seasonal factors typical of the end of Q3, as the Northern Hemisphere's driving season concludes, especially in the US. By September, gasoline contracts for October delivery reflect reduced demand, contributing to weakening sentiment. However, additional pressure on gasoline prices is being exerted by the broader selloff in oil markets and tightening refining margins.
Front-month gasoline prices have been particularly affected by the deteriorating sentiment in global oil markets. Brent crude prices have fluctuated throughout August and into September, but bearish macroeconomic factors have dominated price movements. On September 10, Brent prices dipped below USD 70 per barrel. Despite brief rallies due to Middle East tensions and production disruptions in Libya, these gains were short-lived.
OPEC+'s decision on September 5 to extend production cuts has done little to boost market sentiment or stabilize oil prices. With ongoing macroeconomic weakness and limited upside expected for the remainder of 2024, BMI has revised its Brent price forecast for the year, lowering it from USD 85 per barrel to USD 81 per barrel. This revision has not yet been factored into gasoline price forecasts, suggesting further adjustments may be forthcoming.
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