Global supply-demand balances have shifted wildly during the wars, traders and analysts said, volatility that has caused inventories to draw faster than they can be replenished.
Wood Mackenzie estimated Asian gasoline inventories could remain below the five-year average through the rest of 2026, averaging around 197 million barrels for the remainder of the year, compared with around 207 million barrels in the first half of the year.
"If supply disruptions in the Middle East persist, inventory levels could fall below our forecast," Wood Mackenzie said.
U.S. refiners have prioritized jet fuel production over gasoline due to stronger export demand for the aviation fuel. That has kept gasoline inventories lower than usual for this time of year: at 208.7 million barrels as of August 7, the U.S. gasoline stockpile was about 6% below the five-year seasonal average, government data showed.
U.S. refiners have also been running close to maximum capacity almost non-stop since the Iran war started, and analysts have questioned how long that can be sustained. They have the financial incentive to keep up the pace, since some refined products are fetching twice the value of feedstock crude, Gulf Oil analyst Tom Kloza said.
Yet U.S. companies are also feeling pressure from President Donald Trump to lower domestic gasoline prices, a political flashpoint for his Republican Party which is campaigning to keep its slim majorities in Congress during November midterm elections.
The U.S. Energy Information Administration this month hiked its average retail gasoline price forecast for 2026 to $2.91, about 6% higher than its prior forecast yet much lower than the current average pump price which is over $4 a gallon.
To satisfy Trump's demands, U.S. refiners must walk a fine line between keeping the domestic market well-fed even as they pursue high export margins.
"Diesel cracks could correct lower by $20 per barrel if the White House simply mentioned possible export curbs, and that would take prices down nearly 50 cents a gallon in a heartbeat," Kloza said.
The average price for diesel fuel at a U.S. pumping station was $5.47 a gallon as of Tuesday, nearly 50% higher than last year, according to motorist association AAA.
U.S. diesel margins, measured as the difference between the diesel futures contract HOc1 and U.S. West Texas Intermediate crude futures CLc1, hit a record high of over $102 a barrel on Monday after fresh attacks on refineries in the Middle East and Russia over the past two weeks.
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