US heating oil futures climbed back above $3.60 per gallon, halting a two-day slide, following reports that Iran fired missiles at Israel and reigniting concerns over the stability of the already fragile US–Iran ceasefire. Iran described the strike as a warning to Israel over its actions in Lebanon, while Israel said it intercepted all incoming missiles. President Trump urged Iran to return to negotiations and was reported to be working to head off an Israeli response.
The latest attacks heighten the risk of further military escalation, which could intensify disruptions to Middle Eastern shipping lanes and energy exports, exacerbating tightness in global distillate markets. The Strait of Hormuz, a critical chokepoint for oil and fuel flows that handles roughly one-fifth of global oil consumption, has faced ongoing constraints since March. At the same time, US distillate inventories, including diesel and heating oil, rose by 1.502 million barrels in the final week of May.
