Oil Prices Stuck in Limbo as Gasoline Costs Soar and Supply Concerns Mount
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Despite multiple bullish catalysts, oil prices remained stubbornly rangebound at the start of this week, with markets awaiting a notable shift in sentiment.
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With US gasoline prices now 60% higher than at the time of the 2020 presidential election, the Biden administration will be looking warily at RBOB front-month futures flirting with $2.6 per gallon.
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The two main refinery additions this year, Nigeria’s 650,000 b/d Dangote and Mexico’s 340,000 b/d Dos Bocas refinery, have been plagued by delays and are unlikely to have an impact on H1 gasoline supply, increasing the possibility of potential summer spikes.
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Premium gasoline will be particularly susceptible to price rallies as the NY Harbor RBOB octane spread, gauging the cost of high-octane blendstocks, soared to the highest-ever readings in March, at $0.42 per gallon.
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Maritime warfare continues in the Red Sea as Houthi rebels fired several missiles at the Liberia-flagged container ship Pinocchio, en route to the Suez Canal, claiming the hit was accurate on what they believe is an American-owned tanker.