Sure Jpeg is best for Photos, Drawings, Flowcharts. Then for style effects you can use Gif. For example if you want to make style effects with images you can use .GIF images with CSS style background-repeat property.
You can make styles with small images like 1kb.
sample code
.menubutton
{
background-image: url(../images/btnback.gif);
background-repeat: repeat-x;
}