Nymex Heating oil temporarily scales back

The EIA data release continued to show a weekly deficit in US total stocks despite builds in commercial crude and gasoline inventories. Still, implied demand greatly outpaced expectations, at 21.9 mb/d, with an exceptionally strong diesel demand, buoyed by trucking and heating oil demand in the East coast area. US diesel prices (Nymex Heating oil) collapsed yesterday, despite a sizable draw in inventories nationwide (-1.6 mb) especially in the weather-sensitive demand areas – New England – with stocks falling rapidly. The temperature forecasts for the upper part of the east coast was indeed revised higher, suggesting that the power grid would limit the distillate burn. The potential swing in distillate burn was deemed important, as the uncertainty in demand ranged by 80 kb/d depending on the weather variables. Given the deficit of the region, demand would have been necessarily met by Atlantic imports from Europe or Asia, already supplying the region with an expected 3 mb of distillate to be discharged in the Boston area in the coming month. The collapse in heating oil contracts pulled down ICE Gasoil cracks – which dropped below 14 $/b at the prompt – despite a rather tight market, which should be supported by speculative buying.

EnergyScan oil news
Share this news :

You might also read :

ES-oil
May 12, 2022

War in Ukraine triggers a rebound

Oil made a strong rebound on Wednesday: ICE Brent front month climbed by +4.9% to $107.51/b while NYMEX WTI front month gained +6.0% to settle…
ES-oil
February 3, 2021

US and Japanese crude stockpiles dwindles

Brent prompt futures continued to rally to 54.7 $/b on early Thursday as Saudi Arabia guaranteed that their voluntary supply cut would last two months…
Join EnergyScan

Get more analysis and data with our Premium subscription

Ask for a free trial here

Don’t have an account yet? 

[booked-calendar]