Heating Oil Prices Rise

US heating oil prices rose above $3.20 per gallon, moving in line with other energy commodities, as markets remained concerned over Middle East oil supplies after the recent exchange of US-Iran strikes. Both sides agreed to suspend further attacks for the time being and allow commercial vessels to transit the Strait of Hormuz freely ahead of peace talks later this week, according to a US official speaking on condition of anonymity. However, markets remained cautious as the latest escalation interrupted the recovery in oil flows through the Strait of Hormuz that had followed an earlier interim agreement. Shipowners also stayed wary of using the chokepoint, leaving hundreds of vessels stranded in the Persian Gulf. Adding to concerns, Israel said it carried out fresh strikes on Iran-backed Hezbollah infrastructure in southern Lebanon. Meanwhile, Saudi Aramco resumed crude loadings at Ras Tanura after a nearly four-month suspension.

US heating oil prices fell over 3% to below $3.20 per gallon, tracking the resumption of the decline in crude oil prices as the continued flow of vessels through the Strait of Hormuz outweighed renewed security concerns. More previously stranded oil tankers resumed transiting the Strait of Hormuz despite an incident in which an unidentified projectile struck a container ship near Oman, reigniting concerns over Iran's influence on traffic as Tehran and Washington negotiated a permanent end to the conflict. Meanwhile, Saudi Arabia resumed crude exports from the Ras Tanura terminal for the first time since March, while Qatar issued its first post-conflict crude tender. The White House also waived the Jones Act and tapped the SPR to help contain energy costs. However, the market remains tight because the US operates as a global supplier of last resort, pushing domestic diesel inventories to seasonal lows. Prospective Russian export bans could spark further upward pressure.

US heating oil prices held above $3.20 per gallon after mirroring a rebound in crude driven by renewed safety concerns in the Middle East. The maritime group UKMTO reported that a vessel was struck by an unknown projectile in the Strait of Hormuz off the Omani coast, prompting several commercial ships to reverse course. This incident stoked anxieties regarding Iran's control over the chokepoint as Tehran and Washington negotiate a permanent end to their war. Despite these disruptions, Saudi Arabian tankers proceeded toward the Ras Tanura terminal to resume Persian Gulf exports for the first time since March, and Qatar issued its first post-war crude tender. To contain energy costs, the White House waived the Jones Act and tapped the Strategic Petroleum Reserve. However, the market remains tight because the US operates as a global supplier of last resort, pushing domestic diesel inventories to seasonal lows. Prospective Russian export bans could spark further upward pressure.