Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Heating Oil topic
No spam. Unsubscribe anytime.
EIA expects lower heating-oil expenditures but cautions crude and refinery margins could raise prices
Summary
EIA forecasts baseline heating-oil expenditures to fall about 5% this winter due to lower refining margins, but noted distillate inventories are low on the East Coast and crude-price shocks could push prices higher.
EIA forecast baseline heating-oil expenditures will be about 5% lower this winter but cautioned the market remains sensitive to crude-oil price movements and low distillate inventories in the Northeast.
"Baseline heating oil expenditures are forecast to fall 5% this winter," DeCarolis said, adding that heating-oil prices are tied to global crude and distillate refining margins. He noted refining margins have fallen from the elevated levels seen since 2022 because diesel demand softened and refinery capacity expanded.
Inventory risk: DeCarolis said distillate inventories remain below the five-year average on both the Gulf and East Coast pads, especially on the East Coast, and he pointed to recent East Coast refinery closures as a contributor to low inventories.
Panel context: Kevin Hack told attendees that heating-oil prices are closely linked to global diesel markets; stronger-than-expected diesel demand would raise cracked spreads and feed through into heating-oil prices. EIA framed the heating-oil outlook as a national average that effectively represents the Northeast, where most heating-oil consumers live.
What to watch: crude oil price moves related to geopolitical events and weekly distillate inventory reports; EIA will maintain weekly updates for heating oil over the winter.
