New York: Following the export of more refined products abroad to supply European markets following Russia’s invasion of Ukraine, fuel prices witnessed a surge faster than crude oil prices in the last month in the United States.
Read: Shehbaz rejects proposal for hike in fuel prices
Traders in the US believe that the world’s fuel stockpiles are not likely to increase quickly as big producers, like OPEC, are increasing production slowly. The tightness in fuel markets is highly alarming because it shows refiners are having trouble meeting demand even as more crude becomes available through big reserve releases.
Global stockpiles of crude, gasoline and other fuels are dwindling as demand has rebounded to pre-pandemic levels. Supplies tightened further following the invasion of Ukraine and subsequent sanctions on Russia from the United States and allies.
Washington has released millions of barrels from the US strategic reserves, helping control the price of crude. But inventories of products are still falling.
Since the invasion of Ukraine on February 24, the US crude futures have risen nearly 17%, while the US gasoline futures have jumped over 30%, and the US heating oil futures , a proxy for diesel, have gained by 40%.
