Heating Oil Extends Losses

Heating oil prices in the US declined to around $4.70 per gallon, falling for a third consecutive session amid expectations of increased Russian diesel supplies. US Energy Secretary Chris Wright said Washington could allow more Russian diesel into global markets, depending on Moscow’s actions. This follows a reported US-Russia agreement to resume diesel shipments, while Russian refineries reportedly increased processing by around 25% in the second half of October. The US also plans to loan up to 315,000 barrels from its Northeast Home Heating Oil Reserve. However, supply risks remained elevated as Yemen’s Iran-aligned Houthis claimed to have struck Saudi Arabia’s largest oil refinery with a missile, while reports said Washington warned Gulf states to prepare for a possible post-midterm military campaign against Iran. US distillate inventories remained relatively tight, standing around 9% below their five-year seasonal average in the week ended October 16.

Heating oil prices in the US traded above $4.90 per gallon, not far from their record high of around $5.20 reached in mid-September, as concerns over tight distillate supplies persisted despite plans to release emergency fuel stocks. The US Energy Department announced it would loan 315,000 barrels from the 1 million-barrel Northeast Home Heating Oil Reserve, with bids due October 27 and deliveries expected to be completed by November 13. The temporary release aims to ease heating costs ahead of winter, although its impact may be limited, as borrowers must return the fuel plus a premium. Separately, analysts warned that President Trump's deal with Russia to supply diesel to US and global markets is unlikely to significantly ease price pressures, as the promised volumes are too small to alleviate the global supply squeeze. Meanwhile, EIA data showed US distillate inventories rose by 1.7 million barrels in the week ended October 16, but remained around 9% below their five-year average.

Heating oil prices in the US fell toward $4.80 a gallon as the Trump administration moved to release emergency fuel supplies to ease rising costs ahead of the midterm elections. The Energy Department announced plans to loan 315,000 barrels from the 1 million-barrel Northeast Home Heating Oil Reserve, with deliveries expected to be completed by November 13. Energy Secretary Chris Wright described the move as a temporary response to supply disruptions. Around 4% of US households rely on heating oil, particularly in northeastern states, although the release is unlikely to materially affect the broader diesel market, given that the East Coast consumes approximately 1.2 million barrels of diesel and other distillates daily. Also, EIA data showed distillate inventories rose by almost 2 million barrels last week, offering some relief to markets strained by tight supplies as winter approaches.