Heating Oil Retreats Further

US heating oil prices fell below $4.90 per gallon, retreating further from the record high reached last week, as improved flows through the Strait of Hormuz and renewed diplomatic efforts eased near-term supply concerns. Satellite data showed Saudi oil loadings in the Persian Gulf surged, suggesting exports shifted back toward the Strait of Hormuz as the East-West pipeline shutdown persisted, though reports indicated the line could partially restart within days. Nevertheless, with winter approaching, demand could strengthen, while refinery maintenance may curb production and further tighten already-constrained supplies. EIA data showed distillate inventories, including diesel and heating oil, remained 13% below their five-year average in the week ending September 11. Meanwhile, Russia plans to extend diesel export restrictions through October, while Ukrainian strikes have disrupted output at major refineries, further tightening global distillate supplies.

Heating Oil decreased 5.02% to 4.8039 USD/Gal

US heating oil prices fell to around $5.05 per gallon, retreating from a record high of $5.26 reached last week, as rising inventories and expectations of alternative routes for Middle Eastern barrels offered some respite from tight distillate supplies. EIA data showed distillate inventories, including diesel and heating oil, rose by 1.6 million barrels in the week ended September 11 but remained 13% below their five-year average. Meanwhile, Saudi Arabia was reportedly seeking to restore about half the capacity of its East-West oil pipeline within days after drone attacks halted the key link to the Red Sea, while offering additional crude cargoes to Asian refiners via ship-to-ship transfers off Oman’s Sohar port. Still, supply risks persisted as Saudi Arabia and Iran-backed Houthi forces exchanged fresh strikes. With winter approaching, distillate demand could strengthen, while refinery maintenance could constrain production and put further pressure on already-tight supplies.