Fitch Solutions Country Risk & Industry Research revealed its latest NYMEX RBOB gasoline price forecasts in a new report sent to Rigzone on Thursday.
According to the report, the company sees the commodity averaging $2.70 per gallon in 2023, $2.38 per gallon in 2024, $2.34 per gallon in 2025 and $2.24 per gallon in 2026. A Bloomberg consensus highlighted in the report predicts the commodity will reach $2.79. per gallon this year, $2.86 per gallon in 2024, $2.50 per gallon in 2025 and $2.31 per gallon in 2026. The Fitch Solutions report forecast that the NYMEX RBOB gasoline price was to average $2.95 per gallon in 2022.
“Prices are expected to remain elevated compared to historical levels, but decline from records in 2022,” Fitch Solutions said in the report.
“Total gasoline demand will grow by 1.2 percent year-on-year in 2023, but the gasoline consumption trend between developed (DM) and emerging (EM) markets will diverge in 2023,” the company added.
“Motor gasoline consumption is expected to remain stable in DM as the impacts of the economic slowdown are balanced by the effect of lower fuel prices and slowing inflation. At the same time, gasoline consumption growth will accelerate among EMs from 2.2% y-o-y in 2022 to 2.5% y-o-y in 2023, driven primarily by the reopening of China,” the company continued.
In the report, Fitch Solutions noted that total gasoline production will grow 1.9 percent year-on-year in 2023, “from 1.5 percent year-on-year growth in 2022.”
“Accelerating gasoline production growth will support falling prices. Despite production growth, the global market is expected to remain slightly undersupplied in 2023, which will keep prices elevated above levels historic,” Fitch Solutions stated in the report.
“Low but growing gasoline inventories will support high but declining gasoline price levels in 2023…In the medium term, gasoline prices are forecast to decline…supported by fundamentals as the global balance switch to oversupply next year,” added Fitch Solutions.
RBOB and retail prices
The oil and gas team at Fitch Solutions has previously highlighted this on Rigzone the relationship between RBOB and retail prices is useful for directional trends and volatility. Retail prices are a combination of taxes, local blending requirements, profit margin and delivery costs, as well as other factors, and retailers buy supply in quantities other than contracted volumes both spot and futures, he explained the Fitch Solutions team at Rigzone in 2022. RBOB, being the only widely traded spot and futures contract, provides a good indicator of future price trends and the ability to secure supply at a fixed price, already that the contracts are physical, the team said at the time.
In its latest short-term energy forecast, released this month, the U.S. Energy Information Administration projected that the retail price of gasoline would reach $3.39 per gallon in 2023 and $3.10 per gallon in 2024. The STEO noted that the retail price of gasoline stood at $3.97 per gallon in 2022.
As of Feb. 17, the price of regular gasoline in the U.S. is $3.421 per gallon, according to the AAA gasoline price website. Yesterday’s average was $3.422 per gallon, last week’s average was $3.431 per gallon, last month’s average was $3.327 per gallon, and last year’s average was $3.522 per gallon , according to the AAA site.
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