Topline
The U.S. Department of Transportation has declared a regional emergency for Illinois, Indiana, Michigan and Wisconsin after a fire shut down the BP oil refinery in Whiting, Ind., the largest in the Midwest, though there hasn’t been an impact on gas prices so far.
In this September 21, 2017 photo, petroleum coke, the grainy black byproduct of refining Canadian … [+]
Key Facts
The federal order temporarily lifts restrictions on the maximum working hours for truck drivers in the four states.
Gov. Gretchen Whitmer (D) also signed a similar statewide energy emergency order Saturday, saying regulations “will not hinder the delivery of gas and diesel to stations in Michigan.”
It’s not clear when the Whiting refinery, which is the sixth largest in the U.S., will get back online.
Big Number
435,000. That’s how many barrels of oil are refined at the Whiting facility on an average day.
Key Background
The fire took place in the refinery’s power house and led to a loss of cooling water that could potentially damage equipment, according to Bloomberg, but the extent of the problems are reportedly limited to a small area of the facility, and no injuries were reported. The shutdown comes at an inopportune time, just ahead of the harvest in much of the Midwest, and U.S. gasoline supplies are at their lowest August levels since 2015, according to the Energy Information Agency. The Whiting refinery is a major storage place for crude oil used to make gasoline, and its supplies could be moved to Cushing, Oklahoma, in the event of a long-term closure, according to Bloomberg.
What To Watch For
The months-long trend in sharply declining gas prices should not be affected by the Whiting shutdown, according to GasBuddy analyst Patrick De Haan, and he cautioned against consumers “panic” buying gas, which could cause a strain.
Further Reading
Fire at Biggest US Midwest Refinery Threatens Fuel Supplies (Bloomberg)
Gas Drops Below $3.50 A Gallon In These 10 States—With More Likely To Come (Forbes)
Source: https://www.forbes.com/sites/nicholasreimann/2022/08/27/energy-emergencies-declared-after-bp-refinery-fire-in-indiana/