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Fire At Exxon's Dutch Refinery As Europe’s Diesel Imports Soar

Exxon

The Dutch unit of ExxonMobil said on Monday that a fire broke out at its Rotterdam refinery, just as Shell is working to bring back online its Pernis refinery in the Netherlands—Europe’s biggest—which has been closed for weeks following a fire at the end of July.

Unexpected refinery outages strain Europe’s product supply and the continent needs more diesel imports, so Asian and American traders have been diverting diesel cargoes to Europe.  

No injuries were reported after the fire at Exxon’s 190,000-bpd refinery yesterday, and most of the facility remained operational, Reuters quoted Exxon as saying.

Monday’s incident was the latest in a series of refinery problems that various European refineries have been facing since the spring.

The major one was at Shell’s Pernis refinery in Rotterdam, which was shut down on July 31, after a short circuit caused a major fire.

Expectations were that the 404,000-bpd refinery would be closed for at least two weeks and resume operations “at the earliest in the second half of August.”

Reports had suggested that Shell would try to restart one of the two crude distillation units earlier, but according to Shell’s latest update on the restart, safety checks are still being held and a so-called ‘statement of fitness’ needs to be issued before the resumption of operations. Shell aims to restart most units by the end of August.

Earlier this year, a fire at Total’s Leuna oil refinery near Leipzig in eastern Germany disrupted diesel and gasoline supplies to gas stations in the region, and some retail stations were running out of fuel. In Greece, Hellenic Petroleum declared force majeure on its 100,000-bpd Elefsina refinery in July, suspending diesel exports.

The unplanned refinery outages have prompted traders to ship more oil products to Europe.

According to trading and shipping sources who spoke to Reuters last week, Europe is set to import more than 2 million tons of diesel from the U.S. in August, a record high. Last year, the highest monthly level of European imports of U.S. diesel was 1.74 million tons.

Related: The Latest Red Flag For U.S. Shale

Record refinery runs in the United States have led to more U.S. diesel exports in recent months. Before the European refinery troubles, most of the U.S. diesel was headed to Latin America, where Venezuela, Mexico and Brazil also have refinery problems.

European imports of U.S. diesel in June were low, at around 1 million tons in the end, Robert Campbell, head of oil products analysis at Energy Aspects, told Reuters. But with the refinery issues in Europe, August imports are set to break records.   

By Tsvetana Paraskova for Oilprice.com

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