Speculators are increasingly optimistic about gasoline futures, reaching their most bullish stance in eight months amid low prices and looming concerns about supply constraints next year, Bloomberg reports.

According to data from Commodity Futures Trading Commission (CFTC), the report finds money managers’ net-long positions on gasoline climbed by 6,546 lots to 73,037 in the week ending 10 December.

This marks the highest bullish sentiment since mid-April.

Front-month gasoline futures are currently trading around $1.99 per gallon, reflecting a 5% decline for the year, potentially presenting a buying opportunity for traders.

Market participants appear to be positioning for higher prices in 2024 due to planned refinery outages and closures that could tighten fuel supplies. Notably, LyondellBasell’s Houston refinery, which processes approximately 264,000 barrels per day, is slated to close by the end of the first quarter.

Adding to supply concerns, US government data revealed that gasoline inventories have fallen to their lowest seasonal levels in three years, further fuelling the shift to a more bullish outlook on the fuel market.