Heating Oil Surges to Near 1-Month High
Heating oil futures surged above $2.50 per gallon, reaching near one-month highs as warfare in the Middle East compounded with already tight supplies amid solid demand. In the US, distillate stocks plunged by 4.1 million barrels in the week to June 20th, leaving inventories well below year-ago levels despite refiners operating at 94–95% of capacity, while summer fuel demand has surged to multi-year peaks and record distillate exports have further drained domestic buffers. Globally, output disruptions from drone attacks in Iraqi Kurdistan, cutting some 140–150 kb/d of crude, and new EU sanctions on Russian oil have tightened Atlantic basin supplies. Meanwhile, Egypt’s 65% year-on-year jump in diesel imports is diverting cargoes away from northwest Europe. Against a backdrop of crude oil lingering in the high-$60s per barrel and heightened geopolitical risk, any incremental diesel or heating-oil demand must contend with very thin stocks, driving prices sharply higher.