FX.co ★ Heating Oil Extend Gains

US heating oil prices climbed above $4.60, extending gains from the previous session, as renewed supply concerns compounded an already tight refined-products market. A developing storm in the Gulf of Mexico threatened to disrupt oil production and refining operations, with Gulf Coast refineries accounting for roughly half of US refining capacity, or about 18.2 million barrels per day. At the same time, ongoing attacks in the Middle East heightened worries over energy flows despite higher regional shipments. Additional pressure came from disruptions to Russia’s refining sector, prolonged diesel export restrictions, and reports that China has suspended fuel exports for October, all of which intensified global diesel supply constraints. Reflecting these dynamics, the EIA raised its oil price forecasts for 2026 and 2027, citing rapidly declining global inventories and tightened diesel markets. Separately, the Trump administration ordered temporary relief through year-end from certain diesel tax payments and from penalties on the use of dyed diesel on highways.