Why are refineries shutting down

As of January 1, , we considered the refinery to be permanently closed, and it is not included in our report. In , the pandemic contributed to a substantial decrease in demand for motor fuels and refined petroleum products, which put downward pressure on refinery margins and made market conditions more challenging for refinery operators.

In addition to challenging market conditions, increasing market interest in renewable diesel production and pre-existing plans to scale down or reconfigure petroleum refineries all contributed to the closing of a handful of refineries in We measure refinery capacity in two ways: barrels per calendar day and barrels per stream day. Stream-day capacity reflects the maximum number of barrels of input that a distillation facility can process within a hour period at full capacity under optimal crude oil and product slate conditions.

Our Refinery Capacity Report also includes information on capacity expansions planned for the remainder of the year. BP confirmed it had evacuated and shut in its four deepwater Gulf platforms, and Murphy Oil said Aug.

Other Gulf producers, including Chevron, Equinor, BHP and ExxonMobil, said they had evacuated their personnel and were shutting in most of their offshore production.

Out of the roughly 4. Thus far, Shell said Aug. ExxonMobil said late Aug. The operating status of other regional refiners were unclear, although it was likely they, too, had taken some action to cut rates with estimates that as much as 2. For petrochemical facilities, shutdowns are expected for both steam crackers and their downstream units. Potentially impacted facilities include roughly 6. Other facilities include 3. The price implications are, of course, bullish, especially given that the industry has not fully recovered from the February USGC freeze, other outages this summer, and logistical challenges, said Platts Analytics.

Chevron said Aug. Port closures ahead of the storm will also cut exports of both crude and products from key facilities along the USGC. However, LNG facilities in southwest Louisiana -- west of Ida's projected path -- said they were increasingly confidant they would not see significant impacts from the storm. Pilots serving both channels were meeting to assess the situation, according to notices to shippers. Hurricane Ida zeros in on New Orleans-area refineries. Please use the button below and we will bring you back here when complete.

Latest in Commodities Listen: Colonial Pipeline allocations return on higher demand, lower imports Demand to ship gasoline on Colonial Pipeline has outpaced available space since October, a first in Turnarounds also make the entire system susceptible if another refinery goes down due to an unexpected shutdown.

This can cause the supply and demand restrictions, already in place due to the planned shutdown, to reach critical levels. Shutdowns and turnarounds are a fact of life in the fuel supply industry. At Kendrick Oil, we strive to stay on top of these circumstances so that our clients can manage more efficiently during these stressful events.

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