20.10.202617:11:43UTC+00Gasoline Drops to Seven-Week Low

US gasoline futures declined to about $3.10 per gallon, the lowest level in seven weeks, after unconfirmed reports surfaced of a proposal to restart talks between Iran and the United States. The US Department of Energy also said it is working with domestic refiners to identify ways to increase fuel production and alleviate prices.

In addition, President Trump’s decision to waive key sanctions and tariffs on Russia could ease restrictions on Russian energy trade. Still, analysts are doubtful that extra Russian diesel supplies will significantly affect global markets. Morgan Stanley estimates that the Russian diesel arrangement would add the equivalent of only about 12 hours of global supply.

US gasoline inventories, meanwhile, showed signs of recovery. Data from the Energy Information Administration (EIA) indicated that stockpiles rose by 3.5 million barrels in the week ended October 9th, the second consecutive weekly increase. Even so, persistent supply risks in the Middle East limited further price declines, as attacks on tankers continued to threaten shipping routes through the Persian Gulf.