Gas Prices Won't Drop Much Lower By Election Day, Says Rebecca Babin

• Oil prices are currently range-bound between $80-$90, with potential upside breakouts driven by reduced flows through Hormuz, increased Red Sea attacks, or a material increase in Chinese imports.
• Current oil price declines are attributed to profit-taking and a 'buyer's strike,' with conviction for buying only returning in the low $70s.
• China is identified as the most important short-term factor influencing the oil market's supply-demand balance.
• High refinery utilization (96%) and delayed maintenance pose a significant risk of unexpected outages, which would keep product markets tight.
• Retail gasoline prices are projected to be in the $4.00-$4.30 range by Election Day, while diesel could remain above $5, potentially reaching $5.50-$6.00 in a worst-case scenario.

Oil prices are currently range-bound, but significant upside risks exist from geopolitical tensions in Hormuz and the Red Sea, and potential for increased Chinese demand. Refinery outages pose a critical threat to product supply, keeping gasoline and diesel prices elevated, likely above administration's desired levels by Election Day.