Weekly Focus: Positively Charged Energy News

Week Beginning December 19, 2022For those who are traveling during the holidays, an arctic blast will bring the coldest Christmas in nearly 40 years. More than 80% of the lower 48 will be below freezing by the end of the week, and the majority of the northern United States can expect a white Christmas.
From the entire Marathon Energy team, we wish you all a happy holiday season. There won’t be a Weekly Focus next week, but we hope to see you again in the new year!
Heating oil prices are down again this week to $4.580 per gallon on the East Coast. That is down $0.292 per gallon from last week.
Gasoline prices are down this week to $3.225 per gallon on the East Coast. That is down $0.129 per gallon from the previous week.
Diesel prices are lower this week to $5.007 per gallon on the East Coast. That is down $0.184 per gallon from the previous week.
Since the start of October, propane prices have been holding steady, around $3.376 per gallon in the Northeast. That is down $0.021 per gallon from last week.
Natural Gas
The NYMEX 12-month strip rose $0.23/dth on a volatile week that saw the front month (January 2023) move up or down at least $0.34/dth each day. The market seems to be reacting to the overall preparedness for an expected widespread cold snap in the U.S. for the four or so days around Christmas and January forecasts for the Northeast that are colder than seen last week.
On the supply side, storage volumes look healthy after a withdrawal of just 50 Bcf during the reporting period, bringing the deficit to the five-year average to less than 1%. However, the next two weeks are expected to see stronger withdrawals at about 100 Bcf and 200 Bcf. 
On the demand side, the Northeast is facing some of the coldest temperatures of the season, with NYC looking at highs in the 20s on December 24-25. January, in a flip from the previous week’s forecast, is showing slightly colder than normal forecasts for the important Midwest and Northeast areas of the country.
We’re also getting closer to the expected restarting of the Freeport LNG facility. They are maintaining their end of December date despite receiving a number of FERC questions last week that need to be addressed before production can begin.
Looking ahead, the market will continue to react to weather as we continue into the heart of the heating season. Prices could be volatile as market participants see a milder start to the week followed by cold in the long holiday weekend period.
Power forwards were up $4/MWh last week for the 12-month strip, however, prices were down sharply Monday morning. NYISO in-city UCAP was up 3-5%, as the market continues to lack liquidity. PJM Class 2 RECs were down about 4%, with very little change elsewhere. 
McDonald’s is working to go green. The fast-food restaurant giant has purchased more than 190 megawatts of electricity from a solar farm in Texas to power its warehouses and distribution centers.