Fuel Prices Retreat after Sanctions Panic

By Published On: February 25, 2022Categories: Daily Market News & Insights

Fuel markets spent most of yesterday’s trading session at multi-year highs, with fuel up 15-20 cents and crude oil gaining $7/bbl. By the end of the day, crude prices were nearly unchanged from their previous close. On the other hand, fuel prices held some notable gains – gasoline rose 5 cents in total, and diesel gained nearly 7 cents. Those fuel gains are mostly evaporating this morning, with gasoline and diesel prices down 5 cents and 6 cents, respectively.

Yesterday, we wrote that traders only care about one thing – sanctions. That fact held true. Biden and European allies announced a smaller sanctions package than markets had expected, which led to a complete reversal of earlier gains. The EU is imposing additional sanctions this morning, targeting Putin directly in a largely symbolic move. It appears that Germany, Italy, France, and Cyprus opposed stricter sanctions on Russia, arguing that these penalties would be devastating to their own economies.

Although markets largely recovered yesterday, fuel prices did remain elevated on the heals of the EIA’s inventory report, which showed both gasoline and diesel inventories falling by 0.6 million barrels each. Crude inventories, conversely, rose by 4.5 million barrels. Fuel inventories have been falling steadily over the past year, putting pressure on regional fuel markets. Diesel inventories are currently sitting at just 119 million barrels – below the pre-COVID 5-year range.

This article is part of Daily Market News & Insights

Tagged:

Subscribe to our Daily Feed

Daily articles and insights from the fuel markets and natural gas space.

Categories
Archives
MARKET CONDITION REPORT - DISCLAIMER

The information contained herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Furthermore, no responsibility is assumed for use of this material and no express or implied warranties or guarantees are made. This material and any view or comment expressed herein are provided for informational purposes only and should not be construed in any way as an inducement or recommendation to buy or sell products, commodity futures or options contracts.

Stay on Top of the Fuel Markets

FUELSNews, your daily source of marketing information and insights

Subscribe to our publications and newsletters