US heating oil futures surged more than 7% to above $3.60 per gallon on Monday, recouping most of the previous session’s losses after touching a more than five-week low. The rally tracked a rebound in crude oil prices amid renewed tensions in the Middle East.
Over the weekend, President Donald Trump said a US Navy guided-missile destroyer had struck and disabled an Iranian-flagged cargo ship in the Gulf of Oman, after which Marines boarded and seized the vessel. The incident followed reports that Iran had fired on commercial ships transiting the Strait of Hormuz and again shut the strategic chokepoint, arguing that a US blockade of Iran-linked vessels breached a ceasefire due to expire Tuesday.
The confrontation around the Strait of Hormuz threatens to deepen the global energy crisis and undermines Trump’s expectations for a rapid resolution of the conflict. Separately, forecasts point to mostly warmer-than-normal temperatures through April 30, which could curb both heating and cooling demand.
