* Philadelphia Energy Solutions, the largest U.S. East Coast refiner, cut rates due to the severe weather.
* Natural gas prices in the U.S. Northeast were at an all-time record on the back of heating demand.
* Benchmark U.S. heating oil futures were near their highest in almost three years. (Updates with more details on refining outages, other details, adds bullet points)
By Scott DiSavino and Jarrett Renshaw
NEW YORK, Jan 5 (Reuters) - A severe winter storm in the U.S. Northeast brought plunging temperatures on Friday, driving regional natural gas prices to all-time highs, disrupting refinery operations and causing electrical outages.
From Baltimore to Caribou, Maine, efforts were under way to clear roadways from Thursday's snowfall. Temperatures were expected to be 20 to 30 degrees Fahrenheit below the average for this time of year and could set records, according to the National Weather Service.
Power outages fell to 123,000 from the 235,000 knocked out by the storm over the past couple of days and were largely concentrated in Canada, with 85,100 in Nova Scotia, 16,600 in New Brunswick and 5,100 in Quebec.
Refiners in the Philadelphia region were battling severe cold that has slowed crude deliveries and forced the largest plant on the U.S. Coast to significantly cut production.
Natural gas prices in the U.S. Northeast were at an all-time record on the back of heating demand. Benchmark U.S. heating oil futures were near their highest in almost three years.
Estimated U.S. natural gas demand soared on Monday, surpassing the previous single-day record set in 2014, according to estimates from Reuters. The increase came on the back of the low temperatures, higher consumption in the electric power and industrial sectors, and greater export demand.
U.S. demand for natural gas, which is the major heating fuel in the Northeast and is also widely used by power plants, was expected to remain near record highs this week.
Next-day gas prices in New York City NG-CG-NY-SNL jumped to a record $140.25 per million British thermal units, according to data from brokerage firm SNL going back to 1992. The prior high was $120.75 set during the polar vortex in January 2014.
Spot gas in New England soared to a record $82.75 per mmBtu, according to data going back to 1995. The prior high was $77.60, also in January 2014.
In 2017, next-day gas prices averaged $3.08 per mmBtu in New York and $3.80 in New England.
The only nuclear plant in Massachusetts remained shut on Friday after halting operations on Thursday afternoon due to the failure of a line that connects the reactor to the power grid.
Entergy Corp, which operates the Pilgrim Station, said it had not identified the cause of the line problem. ISO New England, which operates the region's power grid, attributed the shutdown to blizzard conditions.
The New England grid operator said it expected the region to have sufficient generating resources to meet the peak demand of 20,450 megawatts and reserve requirements of 2,128 MW on Friday but would only have a surplus of about 500 MW if it must use all of its reserves. Pilgrim's capacity is about 688 MW.
The average U.S. home heating oil price rose 5.4 percent to $3.078 a gallon in the seven days through Jan. 1 from a week earlier, according to data from the U.S. Energy Information Administration. On the East Coast, the price increased 5.4 percent to $3.085.
Prices for the 2017-18 period are well above the 2016-17 levels, the data showed.
Next-day power prices in New England E-NEPLMHP-IDX and PJM E-PJWHRTP-IX, which covers much of the U.S. Mid-Atlantic and Midwest region, rose to their highest since January 2014 due to a spike for local natural gas.
There are concerns that a significant disruption could lead to a heating oil shortage as distillate inventories in the New England and Mid-Atlantic regions are at their lowest levels for this time of year since 2015.
Supply worries have spurred tankers carrying diesel and heating oil to set out from Europe for the United States, reversing a traditional trade route.
Icebreakers have been used in ports of Boston, New York and Philadelphia to keep shipping lanes clear, but delays are expected, and the Coast Guard said late on Wednesday that those ships would remain at shore until the storm had passed.
Reliance on heating oil is highest in the Northeast, with about 21 percent of households using it for space heating.
Most northern U.S. refiners are not reporting significant problems, but the extreme cold still poses threats.
Philadelphia Energy Solutions has cut rates by 40 percent at its 335,000 bpd refinery complex in Philadelphia due to a winter storm slowing crude deliveries, a source familiar with the plant's operations told Reuters on Friday. It's the largest refinery on the U.S. East Coast.
The company also postponed planned work at its 335,000 barrel-per-day refinery complex in Philadelphia until after the storm.
Ridgebury Pioneer, which was carrying 1.9 million barrels of heavy crude into PBF Energy's East Coast refineries, has been delayed by the storm, according to Reuters Eikon shipping data and two sources familiar with the delivery.
VLCCs, or Very Large Crude Carriers, are uncommon in the Philadelphia region. Monroe Energy was forced to shut its plant in September when a hurricane slowed deliveries.
Reporting by Devika Krishna Kumar, Jarrett Renshaw, Jessica Resnick-Ault and Scott DiSavino; Editing by Lisa Von Ahn AND sUSAN tHOMAS