- Refineries running full throttle likely have delayed making much-needed repairs, and the strain is starting to show, as evidenced by a spate of refinery shutdowns across the U.S.
- The recent shutdown of the BP plant in Whiting, Ind., the largest refinery in the Midwest, is just the latest example of unplanned outages that have plagued U.S. refineries this year, including at Exxon's (NYSE:XOM) refinery in Torrance, Calif., Marathon Petroleum's (NYSE:MPC) refinery in Robinson, Ill., and Shell's (RDS.A, RDS.B) Deer Park jet/diesel unit.
- When summer driving season ends and refiners prepare to shut down for routine fall maintenance, RBN analyst Sandy Fielden says more capacity may go offline this year than usual as refiners catch up on repairs that were put on the back burner while plants ran at a breakneck pace.
- The expected heavier turnaround season is bad news for oil prices, Fielden says: With several refineries shutting down for weeks at a time, crude stockpiles will start growing again in the fall since the oil has nowhere to go, with inventories at the Cushing, Okla., hub possibly reaching record levels.
- ETFs: USO, OIL, UCO, UWTI, SCO, BNO, DBO, OTC:DWTI, DTO, USL, DNO, OLO, SZO, OLEM