Marathon Shuts Down 3rd Biggest U.S. Refinery

Diesel futures surged to a seven-month high in New York after Marathon Petroleum Corp. said it was shutting the third largest US oil refinery following a blaze at a storage tank in Louisiana, Barbara Powell and Robert Tuttle reported for Bloomberg News.

The recent fire at the Garyville refinery in south Louisiana was the third blaze to strike the plant in less than a year. I Photo: Marathon Petroleum

The fire at the Garyville refinery in south Louisiana was contained but ongoing late Friday afternoon, according to Marathon spokespeople. It’s the third blaze to strike the plant in less than a year.

Parish officials have ordered residents within a two-mile radius to evacuate.

Diesel rose 5% while gasoline futures jumped about 4%. The outage threatens to deplete already below-average distillate stockpiles at a time when US demand for the fuel is set to rise going into the harvest and heating seasons.

Garyville, located on the Mississippi River between New Orleans and Baton Rouge, produces about 265,000 barrels a day of gasoline, or about 3% total US consumption.

It also makes about 230,000 barrels per day of diesel, according to Andy Lipow, president of Lipow Oil Associates in Houston. The refinery has a crude processing capacity of 596,000 barrels a day, Jennifer A. Dlouhy, Chunzi Xu and Joe Aboussleman also reported for Bloomberg News.

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