FX.co ★ Heating Oil Rebounds from 6-Month Low

US heating oil futures have risen toward $2.16 a gallon, recovering from six-month lows as the equilibrium between physical supply and winter demand has become more strained over the past week. During the week ending December 19th, US distillate inventories increased by merely 202,000 barrels—significantly less than the anticipated 400,000 barrel rise. This occurred despite a decrease in refinery crude runs by 212,000 barrels per day and a drop in utilization to 94.6%, limiting short-term production output. Additionally, weather conditions and logistical challenges have amplified consumption and tightened market flows. The National Oceanic and Atmospheric Administration (NOAA) reported colder-than-normal weather across parts of the US, and regional transport emergency orders in the Northeast have increased immediate heating oil withdrawals while straining delivery networks. Geopolitical risks have also contributed to the price rise, with crude prices firming up due to renewed concerns over disruptions in Venezuela and ongoing tensions between Russia and Ukraine, which have created uncertainty around future feedstock availability.