09.02.202614:16:57UTC+00Heating Oil Eases

US heating oil futures eased toward $2.38 per gallon after a volatile week, as milder temperature forecasts across key US heating regions reduced demand expectations. Softer heating requirements have helped counterbalance an otherwise seasonally tight supply backdrop, even after EIA data showed a sharp draw of about 5.6 million barrels in distillate inventories and a 3.5-million-barrel decline in crude stocks. Elevated refinery run rates have further tempered supply concerns, with refiners maintaining robust output of heating oil and diesel while keeping export flows steady. At the same time, lower crude feedstock costs have limited upside, with oil benchmarks trading mixed as US–Iran talks in Oman alternately eased and reignited geopolitical risk premia. Additional pressure on heating oil demand has come from cheaper natural gas, which has become a more competitive heating alternative, while rising US gas drilling activity—particularly in the Haynesville—has pointed to higher future supply and reinforced a broader headwind for heating fuels.