Publications: Notes at the Margin

Iran, Distillate, and California (July 20, 2015)


This Notes at the Margin addresses three issues: Iran, a potential distillate surplus, and the situation in California’s petroleum market. On Iran, the completed discussions will do little to change supply or demand. However, the deal could have very important impacts on market behavior, as we discuss below. One major consequence could be a significant crude price decline. On distillate, another 1998/1999 type surplus in late 2015 could send crude prices down sharply, perhaps even to the $20 to $30 per barrel range. On California, contrary to what some believe, the high gasoline prices in the state do not stem from an oil industry conspiracy or strict environmental regulations.


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