New York, March 3, 2026, 13:47 EST — Regular session
- NY Harbor ULSD (heating oil) futures surged over 13% Tuesday, breaking above $3 per gallon.
- Distillates took the lead in the energy rally, lifted by mounting shipping risks out of the Middle East.
- U.S. policy decisions are in focus for traders, along with Wednesday’s report on fuel inventories.
Heating oil futures jumped Tuesday, with the U.S. diesel benchmark notching sharp gains as ongoing Middle East conflict fed concerns about tighter distillate supply. NY Harbor ULSD futures for April delivery were recently up 39.00 cents, or 13.45%, at $3.2904 a gallon, according to CME quotes. 1
Heating oil prices are making waves—directly impacting trucking, industry transport costs, and winter heating bills across the U.S. Northeast. After a punishing winter left distillate markets tight, the price jump has come on fast and hard.
Refiners have their eyes on margins. Crack spreads, that fast-and-dirty gauge of refinery profit, have been getting wider as diesel and heating oil prices race ahead of crude.
Oil prices surged too. Brent jumped $6.07, or 7.8%, to hit $83.81 a barrel as of 10:35 a.m. EST. U.S. crude climbed $6, up 8.4%, reaching $77.23. Gasoline futures tacked on almost 5%, Reuters data show. ING analysts pointed to “a greater risk” if Iran strikes more energy infrastructure in the region. 2
Heating oil is catching a lift from diesel’s sharp rally. On Monday, U.S. diesel futures shot up almost 12%, climbing back over $3 a gallon for the first time since November 2023. “These stocks are at the bottom of the normal range,” energy economist Philip Verleger noted. “Farmers will have to bear the brunt of any increases to diesel costs,” warned Oasis Energy’s Alex Hodes, as planting season gets underway. 3
The Strait of Hormuz is drawing intense scrutiny. Tanker traffic through the key chokepoint—responsible for moving around 20% of global oil and LNG—has slowed or come to a halt as a result of recent attacks on vessels and energy infrastructure. Shippers are facing insurance shakeups, and disruptions are rippling across the region, Reuters said. 4
Physical markets are seeing action as well. Heating oil in New York Harbor finished Monday up 12.2% at $2.85 per gallon. Low-sulfur diesel? That ticked up, too—hitting $3.00, according to U.S. government figures. 5
Whether refiners and end-users push things forward remains to be seen. Distillate margins spike, and U.S. refineries might respond by churning out extra diesel and heating oil—just don’t expect it overnight. Even so, the market’s already factoring in a tighter supply for the near-term.
President Donald Trump was set to weigh several measures in Washington on Tuesday to address rising energy prices, two sources told Reuters. Among the options: U.S. backing to help oil tankers in the region secure insurance. Speaking to reporters, Trump said Americans might face higher prices “for a short period,” but assured that “as soon as this ends, those prices are going to drop.” 6
The rally might not stick. Societe Generale’s team sees a quick surge, then a pullback—not much lasting power. Macquarie’s Vikas Dwivedi put it bluntly: the world can manage a shutdown for a week or so, but “escalates rapidly after a third week.” 7
Secretary of State Marco Rubio said on Tuesday that Treasury Secretary Scott Bessent and Energy Secretary Chris Wright are set to unveil their mitigation strategies, ahead of a 2 p.m. meeting with Trump in Washington. “Starting tomorrow, you will see us rolling out those phases,” Rubio told reporters. 8
Heating oil traders are now looking ahead to Wednesday’s U.S. Weekly Petroleum Status Report, out at 10:30 a.m. Eastern—potentially a fresh read on distillate stocks heading into mid-March. For now, focus remains on any updates about Hormuz shipping flows and tanker insurance. 9
