Crude Oil, Distillates Soar on Projected Demand

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rude oil prices surged Monday, and heating oil futures — which often parallel diesel prices — soared close to a record on speculation that global demand for fuels including diesel may rise faster than refineries can produce it, Bloomberg reported.

Heating oil futures for July delivery rose 5.6 cents a gallon to $1.66, the second-highest close on record behind April 4, when crude oil prices also hit a record.

Diesel and heating-oil are both distillate fuels and their prices often parallel each other.

Benchmark light sweet crude oil gained more than $2 a barrel to close at $55.62 a barrel on the New York Mercantile Exchange, Bloomberg said.

Bloomberg quoted an analyst who said that outside the United States diesel was becoming the fuel of choice. It also cited a German report that showed rising demand for distillates.

U.S. distillate demand for the four weeks ended June 3 averaged 6.6% higher than the same period last year, the Department of Energy said.