Heating Oil Falls to August Low

US heating oil futures extended their decline below $4.10 per gallon, reaching their lowest level since early August, pressured by expectations of further diplomatic efforts in the Middle East. President Donald Trump's remarks that extensive strikes on Iran were "highly unlikely" eased concerns over renewed attacks on Tehran. However, supply risks persist amid continued regional attacks. Meanwhile, Ukraine has intensified strikes on Russian energy infrastructure, including Kirishi, Russia's second-largest refinery. The attacks threaten Russian gasoline and diesel production and raise questions over the reported agreement between Presidents Putin and Trump on Russian diesel exports to global markets. In the US, EIA data showed distillate inventories, including diesel and heating oil, fell by 3.6 million barrels in the week ended October 30, leaving stocks 13% below the five-year average and highlighting continued supply tightness.

US heating oil futures held above $4.30 per gallon, recovering from a five-week low of $4.20 reached on November 4, driven by tight supplies and geopolitical risks. Democrats’ victory in both chambers of Congress could give them greater influence over government spending and constrain President Donald Trump’s ability to pursue the conflict with Iran, although diplomatic progress remains limited. Supply concerns were reinforced by EIA data showing US distillate inventories, including diesel and heating oil, fell by 3.6 million barrels in the week ended October 30, leaving stocks 13% below the five-year average and at a record seasonal low. Meanwhile, Iran reported that a tanker had struck a mine in the Strait of Hormuz, while discussions with Oman aim to restore shipping. Additional pressure comes from Russia’s plan to extend its diesel export ban through January 2027, although some exceptions will remain.

US heating oil futures dropped to around $4.17 per gallon, reaching their lowest level since late August, as expectations of faster progress toward ending the US-Iran war weighed on prices. Democrats’ victory in both chambers of Congress in the US midterm elections raised the prospect of tighter constraints on military spending and renewed efforts to reach a peace deal. Meanwhile, the US Energy Department plans to loan 300,000 barrels of fuel oil from its emergency Northeast Home Heating Oil Reserve to four companies to ease supply constraints and curb prices ahead of winter. The volume represents nearly a third of the reserve, with deliveries due by November 6. The companies must return the same amount with an additional premium before next year's heating season. However, supply remains tight, as US distillate inventories, including diesel and heating oil, fell by 3.6 million barrels in the week ended October 30, leaving them 13% below the five-year average.