NEW YORK/LONDON: An intense winter storm froze pipes and disrupted services at refineries on the US Atlantic coast on Thursday, sending fuel prices higher as heavy snowfall and high winds caused electricity outages for tens of thousands of Americans.
Some 65,000 homes and businesses along the US East Coast are without power, and that number is expected to swell on Thursday as the storm punishes the densely populated US Northeast.
The storm is the product of a rapid and rare sharp drop in barometric pressure known as bombogenesis, or bomb cyclone. Heavy snow pounded the East Coast along a front stretching from Maine as far south as North Carolina early on Thursday, taking out power lines, icing over roadways and closing hundreds of schools.
Prices for heating oil and natural gas in the US Northeast hit their highest levels in years on the back of near-record heating demand. Benchmark US heating oil futures are near their highest in almost three years.
US natural gas demand was expected to remain near record highs this week. Natural gas is the major fuel for residential and commercial heating in the US Northeast and is also widely used by power plants.
On Wednesday, natural gas futures fell 1.6 percent to $3.008 per million British thermal units, but cash prices in New York and New England remain elevated.
“NYMEX Henry Hub prices should rise further to the mid-$3 range, as cash Henry Hub prices already traded above $6. But the market, due to the supposed record-breaking production growth in 2018, still seems to be under-appreciating the potential for cold weather persisting,” Citi analysts said in a note.
New England’s cash prices
‘Bomb cyclone’ hits US East Coast energy, power supply
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