FX.co ★ Heating Oil Surges to Record High

US heating oil prices climbed above $4.70 per gallon in early September, setting a new record and standing roughly 100% higher than a year earlier, as distillate supplies tightened sharply. Industry data showed US distillate inventories declined by 300,000 barrels in the week ending August 28, reinforcing signs of mounting supply constraints ahead of the winter heating season. Tightness is also evident across the broader refined-fuels complex: US diesel futures have reached a 52-month high, while the diesel crack spread has risen to an all-time peak. At the same time, US refinery utilization has held at or above 95% for 12 straight weeks, leaving little spare capacity to rebuild stocks or absorb additional disruptions. Supply risks remain elevated amid renewed tensions between the US and Iran, which have stoked concerns about oil flows through the Strait of Hormuz, and ongoing Ukrainian strikes on Russian refineries, which have further reduced global refining capacity.