New York, Jan 12, 2026, 08:19 EST — Premarket
NY Harbor ULSD (heating oil) futures edged higher by roughly 0.2% to $2.1387 a gallon early Monday, following a close at $2.1350. So far, the contract has swung between $2.1175 and $2.1585, with volume near 3,952 lots.
Heating oil kicked off the week with crude pulling the strings once more. Brent and WTI edged down after Iran sought to ease supply concerns, even as traders watched closely to see if Venezuelan barrels would actually flow.
ULSD stands for ultra-low sulfur diesel, the key distillate contract for the U.S. East Coast. Traders often use “distillate” to refer to diesel and heating oil, which can see sharp moves during winter due to demand fluctuations and refinery news.
Brent crude futures slipped 0.2% to $63.19 a barrel by 1248 GMT, while WTI fell 0.3% to $58.93, Reuters reported. The move came after Iran’s foreign minister claimed the situation was “under total control” following weekend unrest. UBS analyst Giovanni Staunovo attributed the dip to softer European stocks and a “lack of additional supply disruptions.” Meanwhile, MST Marquee’s Saul Kavonic warned the market is still undervaluing the risk of a broader Iran conflict that could disrupt flows through the Strait of Hormuz. Traders also tracked a rush for tankers amid expected Venezuelan export resumptions, with Trafigura telling a White House meeting that its first vessel should load in the coming week. Reuters
Open interest in the NY Harbor ULSD complex — the total number of outstanding futures contracts — hovered around 88,730, according to data from TradingView, offering a snapshot of the exposure still active.
Wednesday brings the next critical look at U.S. distillate inventories. The Energy Information Administration will publish its Weekly Petroleum Status Report on Jan. 14, after 10:30 a.m. Traders usually zero in on refinery runs, distillate stock levels, and implied demand.
Amid the broader chatter, the sell-side remains bearish on 2026’s supply outlook. Goldman Sachs, in a recent note, predicts oil prices will slide as supply swells, holding steady on its 2026 averages: $56 for Brent and $52 for WTI. The bank forecasts a surplus of 2.3 million barrels per day that year. It added that “rebalancing” will likely require prices to drop further, and it stuck to its call to short a Brent time-spread — betting on the gap between two futures months widening to reflect the surplus. Reuters
That macro call could weigh on heating oil, though distillates don’t always follow crude prices. A cold snap, refinery trouble, or shipping delays can squeeze nearby supply even if the longer-dated curve appears heavy.
The downside risk is clear. Should Iran tensions ease, Venezuelan exports resume smoothly, and Russian supply remain stable, crude prices could drop, dragging heating oil down too. Traders would likely watch refining “cracks” — the spread between products like diesel and their crude feedstock — for early warning signs.
Coming up on Jan. 13 is the EIA’s Short-Term Energy Outlook, a regular update that often resets expectations around supply, demand, and inventories ahead of Wednesday’s weekly stock report.
