Oil prices began March at $68/barrel. Concerns about tariff impacts, along with OPEC’s plans for eight of its member nations to increase production for the first time since 2022, pushed prices down to $66 by the end of the first week of March. A fresh round of additional sanctions on Iran helped prices rebound. The following week, OPEC issued its production schedule outlining cuts from seven of its member nations, lifting crude prices higher. The following graph shows the daily price movements over the past three months:
Gains continued as the Trump administration threatened to place 25% tariffs on imports from countries that buy Venezuelan crude. Additional threats to slap new tariffs on nations buying Russian oil helped push prices to five-week highs by the end of March.
The graphs below show the movement of crude oil (converted to gallons) along with wholesale and retail fuel prices over the trailing 15 months:
In March, diesel wholesale prices fell at a slightly quicker pace than retail prices, resulting in profit margins heading higher for the month. For gas, profit margins decreased as wholesale outpaced retail prices. The following graph shows the retail margins over the trailing 15 months:
According to AAA, the national average retail price for gas in March was $3.17, rising about $0.06/gallon from February. The national average price for diesel finished at $3.60/gallon, which is roughly $0.07/gallon less than February.
Heading into April, the market will continue to be at the mercy of contradictory bullish and bearish forces. Fears of economic slowdown or even outright recession comprise the bearish case for oil. Meanwhile, a complex web of geopolitical risks make a bullish case for price increases: continued uncertainty surrounding existing and new tariffs, the ongoing strikes against Houthi militants in Yemen, and increasingly bellicose saber-rattling by the Trump administration against Iran and Russia. These uncertain factors conspired to lift crude prices to nearly $72/barrel by month’s end.
Sokolis currently anticipates that oil prices will continue to range between $65-75/barrel, but volatile geopolitical factors combined with concerns about a slowing U.S. economy provide the market with a great deal of uncertainty heading into Q2 2025.
