BP Shuts Down Indiana Refinery
February 2, 2024
There were two big new items yesterday. The first was heavy flaring and power upset at BP’s Whiting Indiana refinery and the report of a cease fire in the Gaza conflict.
BP said it was shutting down its 435,000-bpd refinery in Whiting, Indiaan after a suspected power outage. The City of Whiting said the power outage caused flaring as additional product was being burned. It was later reported that a transformer failure caused the plant-wide power outage and forced an evacuation of all but the most essential workers. News of the fire rallied Chicago gasoline and diesel sport cash prices some 15 to 20 cents per gallon. The question that the market now tries to figure out is how long the refinery will be down.
The other news was the report of a cease fire in the conflict between Israel and Hamas, as reported by Al Jazeera’s Arabic news wire. The market started selling off after this news hit the wire, oil price fell nearly 2% initially. But later this report was unconfirmed and then prices started to recover, and then Whiting news also hit offering support. Energy markets are very sensitive to headlines currently as they wait for some news or event that will kick them out of their ranges.
The OPEC+ monitoring committee met and recommended no changes to the current existing cuts for the next meeting scheduled April 3.