BAKU, Azerbaijan, Nov.23. Gasoline prices are expected to average at USd240/gal in 2024 and 2025 and USd220/gal in 2026, Trend reports November 23 with reference to Fitch Solutions.
“We maintain our long-term view that demand growth for gasoline will weaken, with growth driven primarily by emerging markets as developed markets continue to lower their consumption as they pursue the energy transition,” reads a report released by Fitch Solutions.
The company analysts note that some of the largest consumers of gasoline are set to see economic slowdown or an outright recession on 2023.
“The declines in gasoline demand among the developed markets will be balanced out by sustained growth in demand among the emerging markets in 2023. On the supply side, we continue to see the refining capacity dwindle in key markets, with the US available capacity in a downward trend accelerated by the Covid-19 pandemic. However, the elevated margins over 2022 have pushed their utilisation rates higher, allowing for higher output. Low inventories of motor gasoline in the US will add a floor to prices next year,” reads the report.
Fitch Solutions says that more severe economic slowdown or recession across developed economies would weaken gasoline consumption and see prices settling lower.
“Sustained elevated inflation into 2023 would accelerate price-related demand destruction. Weaker than expected recovery in China and demand growth in other emerging markets would weigh on total gasoline demand and on fuel prices. On the upside a higher than currently expected oil price environment would elevate fuel prices. We see elevated input costs weakening investor sentiment in the US, a key oil supply growth driver in 2023.”
---
Follow the author on Twitter: @Lyaman_Zeyn