NEW YORK, Jan 26, 2026, 06:54 EST — Premarket
- NYMEX NY Harbor ULSD (heating oil) March futures climbed roughly 2% in early deals.
- Concerns over cold weather supply and Middle East tensions boosted refined fuels.
- Traders are on edge, awaiting this week’s U.S. government report for new inventory clues.
Heating oil prices rose Monday morning, as NYMEX NY Harbor ULSD March futures added 5.11 cents, or roughly 2.2%, reaching $2.3917 a gallon. 1
This move matters because ULSD, the main U.S. distillate benchmark, tends to react sharply when winter weather tightens supply or boosts heating demand. Brent rose 7 cents to $65.95 a barrel, while U.S. crude crept up 3 cents to $61.10, following last week’s gains. Traders are factoring in weather-related shutdowns alongside fresh Iran risks. “Winter storm Fern … adding stress to the power grid,” said Priyanka Sachdeva, senior market analyst at Phillip Nova. JPMorgan analysts estimate U.S. crude output losses around 250,000 barrels per day. 2
Cold weather stress is hitting the power market, and that pressure could push into distillates as utilities shift fuels. PJM reported nearly 21 gigawatts of generation offline Sunday. Meanwhile, New England leaned heavily on oil-fired plants, which accounted for close to 40% of output. Pieter Mul, a grid expert at PA Consulting, noted “there is less flexibility” in PJM now compared to a few years back. S&P Global’s Matthew Palmer cautioned that “the risk isn’t over,” with cold lingering after the storm. PJM is also forecasting a winter demand record on Tuesday. 3
The contract commonly known as “heating oil” is NY Harbor ULSD, a NYMEX futures benchmark priced in dollars per gallon. Each standard contract covers 42,000 gallons. 4
Prices have also been influenced by the front end of the curve, where immediate supply appears tighter compared to later months. MarketWatch reported the front-month February heating oil contract at $2.5101 a gallon late Sunday, rising 8.16 cents. 5
Natural gas prices have surged amid this cold snap, adding strain to the wider “winter fuel” sector. An Arctic blast triggered about a 70% jump in U.S. natural gas prices, Reuters reported. Should gas supplies tighten further, demand could shift toward oil products in certain areas. 6
Distillate traders are closely monitoring if storm-related disruptions hold up refining rates, pipeline shipments, or local restocking in the Northeast. Minor glitches can quickly cascade, given diesel and heating oil’s role in trucking, industry, and home heating in some U.S. regions.
They’re also focused on tweaking incentives. The “crack spread”—the difference between crude oil and refined product prices—is a rough stand-in for refinery margins. This spread can shift dramatically when a cold snap drives up demand.
The upside isn’t guaranteed. If temperatures ease or shut-in production returns swiftly, that winter premium could vanish just as fast. Meanwhile, the broader market wrestles with balancing immediate disruption risks against concerns over oversupply down the line in 2026.
Next in line is new U.S. government inventory data: the Energy Information Administration will publish its weekly petroleum status report after 10:30 a.m. Eastern on Wednesday. The agency’s distillate stocks update is scheduled for Jan. 28. 7
