As plants operate at record-high capacities to soak up cheap crude and satisfy a growing demand for gasoline, a spate of refinery shutdowns have cropped up across the United States, including a recent shutdown of the BP Whiting plant, the largest refinery in the Midwest.
“It stands to reason that if you run any sophisticated plant harder and faster than normal, you are bound to end up breaking something,” RBN analyst Sandy Fielden wrote in a recent analysis of crude refining trends.
The shutdown of a relatively new crude distillation tower at the BP Whiting plant has been linked to leaking tubes, according to media reports. The outage has caused gasoline prices to spike in the Chicago area and diminished demand for heavy crudes from Canada, Fielden wrote.
The problem at the BP plant in Indiana is the latest example of unplanned outages that have plagued the nation’s refineries this year.
An explosion at an Exxon Mobil refinery in Torrance, California in February that injured four workers and knocked operations offline has attracted the most attention, as West Coast gasoline prices to spiked for weeks. But smaller outages have happened, as well. Philadelphia Energy Solutions shut down a catalytic cracking unit that makes gasoline while Marathon Petroleum Corp. shut its refinery in Robinson, Illinois for repairs expected to last two months, according to Reuters reports. Along the Gulf Coast, Shell Deer Park’s jet/diesel unit went down at the end of July, Fielden said.
“What that tells us is that not only have refiners been putting the pedal to the floor but that they have also been putting off routine maintenance in order to keep the party going,” he wrote.
As summer driving season inches to a close on Labor Day and refiners prepare to shut down for routine fall maintenance, more capacity may go offline this year than in the past as refiners catch up on repairs that were put on the back burner while plants ran at a breakneck pace, Fielden wrote.
The expected heavier turnaround season is bad news for oil prices. FuelFix has the full story.
