Published on May 22, 2014

The traditional heating oil is gradually being replaced by cleaner-burning fuels such as natural gas and lower-sulfur distillate grades.
In US, majority of the households rely on natural gas as their primary heating fuel, while only 6 per cent use heating oil.
New York uses more residential heating oil than any other state. But they reduced the amount of sulfur in home heating oil to 15 ppm in 2012. Rhode Island also reduced sulfur levels to 50 ppm in 2013.
In July, states like New Jersey, Connecticut, Massachusetts and Vermont will lower sulfur levels to 500 ppm. These 4 states along with New York and Rhode Island represented 2.163 billion barrels of demand in 2012.
Maine and Pennsylvania will also be limiting sulfur levels by 2016. Traditional heating oil stocks have slipped in 8-10 weeks, reaching a record low 13.46 million barrels.
Heating oil demand is gradually declining. More and more consumers are moving toward natural gas and the increase rates of cleaner burning heating oil will probably quicken the pace of transition. However, natural gas is limited by lack of infrastructure.
Experts suggest that this summer's distillate stock will be made of ultra low sulfur heating oil, which has less than 15ppm sulfur. Average distillate stock growth this year is projected to be 89,000 bpd.
The import market for low sulfur distillate is growing, having reached 5.32 million barrels in February. Increasing demand for ULSHO in New York led to more imports due to the cold weather.
Thus, heating oil isnt completely out of the picture yet.