Will Gasoline Experience Seasonal Weakness over the Coming Months?

I asked how high gasoline futures prices could rise in a May 21, 2026, Barchart article, concluding with the following:

As the summer progresses, the gasoline futures market will shift its focus to the off-season for demand. However, continued hostilities and any escalation between the U.S. and Iran could cause gasoline prices to soar from current levels. The all-time high in NYMEX gasoline futures was in Q2 2022 at $4.3260, which is the ultimate upside technical resistance level. Meanwhile, UGA is already trading in record territory, having only reached $80.29 per share in Q2 2022. 

UGA has already reached a record high, but NYMEX gasoline futures are still below the 2022 peak. A move above that level is certainly not out of the question. The path of least resistance of the oil product futures depends on the Middle East, which is highly uncertain in May 2026. 

UGA is the United States Gasoline ETF, which was trading at $119.47 on May 20, 2026, with the nearby NYMEX gasoline futures at $3.4746 per gallon wholesale. In early August, the nearby September gasoline futures were lower at below $2.85 per gallon, and UGA was lower at just over $107 per share. Events in the Middle East will determine if seasonality in the gasoline market matters over the coming weeks and months. 

Gasoline futures have been rallying since late June 

Since gasoline demand tends to peak during the late spring and summer, prices often reach annual lows in winter and highs in late spring and summer. 

The daily continuous year-to-date NYMEX RBOB gasoline futures chart shows that in 2026, gasoline reached a low of $1.6656 on January 5 and began moving slowly higher as the peak driving season approached. However, the hostilities turbocharged gasoline’s seasonal rally and took the futures 126% higher to a high of $3.7640 per gallon wholesale on May 4, the highest price since 2022 after Russia invaded Ukraine. 

At below $2.85 per gallon on the nearby contract in early August, gasoline futures have turned lower after rallying since late June, as the market approaches the end of the peak-demand season. The attacks in the Middle East, the closure of critical logistical passageways, and the potential for all-out war had kept gasoline prices near record highs, but the on-again, off-again negotiations have caused substantial price volatility.

UGA has tracked the NYMEX gasoline futures

At $107 per share, the U.S. Gasoline ETF (UGA) had over $122.89 million in assets under management. UGA trades an average of over 54,600 shares per day and charges around a 1% management fee. 

The daily year-to-date UGA chart shows the 108.8% rally from the 2026 low of $60.70 on January 2 to the July 23 high of $126.75 per share. At just over $107 in early August, UGA has turned lower and has done an excellent job tracking NYMEX gasoline futures. 

Gasoline’s path depends on the Middle East as seasonality is in the backseat

Seasonality over the coming weeks and months favors the downside in gasoline prices, but the ongoing and escalating conflict in the Middle East could trump seasonality and send prices even higher. As the U.S. steps up attacks on Iranian military and civilian infrastructure, Iran has been launching missiles at neighboring countries hosting U.S. military assets. While the U.S. asserts it controls the Strait of Hormuz with its blockade, Iran asserts that it controls the critical passageway. Moreover, the Iranian-backed Houthis in Yemen have begun attacking 
Saudi assets, and have threatened a complete shutdown of the Bab el-Mandeb Strait, the southern entrance to the Red Sea, that would stop Saudi shipments to Asia and reduce global oil supplies by 7%. 

While the U.S. and other countries have released crude oil from SPRs, the U.S. stockpile has declined to 307.7 million barrels as of the week ending on July 24. The U.S. SPR cannot fall to zero, as there must be a minimum amount in storage; the lower it falls, the more difficult it becomes to release petroleum. As the SPR falls and global oil supplies shrink, oil and oil product prices are likely to rise. 

Expect massive price volatility over the coming weeks

After the MOU fell apart, the U.S. and Iran began escalating the conflict that threatens to become an all-out war in the region, which could send oil and oil product prices substantially higher and to new record highs. However, China's reliance on Middle Eastern petroleum, along with that of other Asian and European countries, could force a resolution. Whether pressure on the U.S. or Iran leads to another ceasefire, free-flowing oil and oil products, and no attacks on production or refining in the region could cause prices to plunge. Moreover, the U.S. administration faces the upcoming midterm elections. High oil and gasoline prices will cause an uproar with voters, and the opposition party in Congress and the Senate could turn high energy prices into majorities for the opposition in November, derailing the current administration’s domestic and foreign policy initiatives.  

Crude oil and oil products are highly political commodities from a U.S. domestic and geopolitical policy perspective. Time will tell if the U.S. and China, the world’s largest economies and most powerful countries, will come together to create a solution that allows the energy commodity to flow. While the U.S. is at war with Iran, China supports the theocracy, giving Beijing leverage over Tehran. The U.S. and China are at odds over the situation, but they have one thing in common: neither will jeopardize their economic growth and stability. The rhetoric between Washington and Beijing may intensify, but back-channel diplomacy could create the environment for a mutually beneficial solution. 

The bottom line is that crude oil and oil product prices will reflect the ongoing situation over the coming weeks, and perhaps months. 

 UGA is a useful trading product

While gasoline prices have risen substantially, they have remained below the 2022 all-time high during the most recent rally. 

The quarterly continuous chart dating back to 1984 shows that gasoline futures reached a record $4.3260 per gallon wholesale high during the first half of 2022, 14.9% higher than the 2026 high. While the offseason is on the horizon, the path of least resistance of gasoline futures depends on the Middle East conflict. 

The quarterly UGA chart dating back to 2008 shows that the ETF only reached a high of $80.29 per share in 2022 when gasoline prices reached their record peak. While the gasoline futures have remained below the 2022 high, UGA exploded to a new high of $125.47 per share in 2026. Expect UGA to continue to track NYMEX gasoline prices over the coming weeks and months, and expect lots of volatility as the outcome of the current conflict remains highly uncertain. 

Gasoline futures are moving toward the time of year when seasonality tends to push prices lower, but the situation in the Middle East will determine whether prices explode or implode over the coming weeks and months.