October heating oil prices traded sharply higher during the early morning hours, with gains of nearly 2.0%. Some technical traders were impressed by yesterday's upside reversal action that bounced off of a test of the August 23rd low. It appears that much of the early-morning strength comes in response to the gains in Brent crude oil. Yesterday's EIA distillate stocks report showed an increase of 1.711 million barrels, which was more than expected. Despite the build, inventory comparisons to the same week last year tightened slightly to 16.027 million barrels. Distillate imports came in at 154,000 barrels per day compared to 152,000 barrels the previous week. Average total distillate demand for the past four weeks was up 0.78% compared to last year. Meanwhile, EIA heating oil stocks drew down 23,000 barrels on the week.
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