FX.co ★ Heating Oil Holds Losses

US heating oil futures hovered around $3.60 per gallon in early June, extending losses from the previous session as markets weighed ongoing diplomatic efforts in the Middle East. President Donald Trump said ceasefire talks were in their “final” stages, in contrast to earlier comments from Iran’s foreign minister indicating that negotiations had stalled. These conflicting statements came on the heels of a sharp escalation in violence earlier in the week. Underscoring the fragility of any potential deal, Iran-backed Hezbollah also rejected a US-brokered ceasefire proposal in Lebanon. The resulting geopolitical uncertainty has continued to disrupt tanker traffic through the Strait of Hormuz—an artery that handles roughly one-fifth of global oil consumption and has remained largely closed since March—driving heating oil futures to a record high of $4.60 per gallon that month. At the same time, US distillate inventories, which include diesel and heating oil, rose by 1.502 million barrels in the final week of May.