2025.07.1813:30:10UTC+00Heating Oil Surges to Near 1-Month High

Heating oil futures have risen sharply, surpassing $2.50 per gallon. This increase, which approaches the highest level in nearly a month, is attributed to the escalating conflict in the Middle East combined with an already constrained supply and steady demand. In the United States, distillate inventories fell significantly by 4.1 million barrels in the week ending June 20th, with current stock levels trailing those of the previous year. This is despite refiners working at nearly full capacity (94–95%), amid a significant rise in summer fuel demand reaching multi-year highs and record distillate exports further depleting domestic reserves. Globally, supply has been further strained by drone attacks in Iraqi Kurdistan, disrupting 140–150 thousand barrels per day of crude production, and new EU sanctions on Russian oil, tightening supply in the Atlantic basin. Additionally, Egypt's 65% increase in diesel imports compared to the previous year is shifting shipments away from northwest Europe. With crude oil prices remaining in the high $60s per barrel and increased geopolitical tensions, any additional demand for diesel or heating oil is confronted by very limited stock levels, pushing prices substantially higher.