Heating Oil Hits 5-week Low

US heating oil prices rose above $4.60, extending gains from the previous session, as renewed supply concerns added to an already tight refined-products market. A developing storm in the Gulf of Mexico could disrupt oil and refining operations, with refineries in US Gulf states accounting for about 50% of the national refining capacity of 18.2 million barrels per day. Meanwhile, continued attacks in the Middle East raised concerns over energy flows despite increased regional shipments, while disruptions to Russia’s refining operations and extended diesel-export restrictions, along with China’s reported suspension of October fuel exports, added to global diesel supply constraints. The EIA raised its 2026 and 2027 oil price forecasts, citing rapidly falling global inventories and tight diesel markets. Separately, the Trump administration ordered temporary relief from certain diesel-tax payments and penalties for using dyed diesel on highways through the year-end.

Heating Oil decreased to 4.38 USD/Gal, the lowest since August 2026. Over the past 4 weeks, Heating Oil lost 4.1%, and in the last 12 months, it increased 93.38%.

US heating oil prices fell below $4.50 per gallon as President Donald Trump signed an executive order expanding access to tax-exempt diesel in the latest bid to lower diesel costs. The order waives the off-road requirement for red-dyed diesel, allowing it to be purchased tax-free for any use. The G7 also pledged last week to release 100 million barrels of diesel from strategic emergency reserves, although the amount of additional supply remained unclear. Nevertheless, heating oil prices remained close to their record high of $5.20 reached in mid-September as refined product markets remained tight. EIA data showed US distillate inventories at historically low levels, while refinery maintenance and seasonal demand were expected to keep supplies tight. Disruptions in the Middle East and Russia, along with Moscow’s extended diesel-export restrictions and China’s suspension of October fuel exports, further constrained global diesel availability.