Oil refineries shut, one on fire following giant earthquake in Japan

By Phaedra Friend Troy

Various media have reported that a large oil refinery is on fire following the 8.9-magnitude earthquake that struck Japan Friday.

An earthquake measuring 8.9 on the Richter Scale was recorded near the east coast of Honshu, Japan Friday, followed by a series of massive tsunamis hitting the coastline. Preliminary reports estimate at least 50 people have died, but more are feared dead.

Located about 40 kilometers east of Tokyo, the Cosmo Oil Co. refinery processes 220,000 barrels of oil a day. Firefighters are working to extinguish the blaze at the oil refinery, which is thought to have ignited in the storage tanks.

Additionally, Japan’s JX Nippon Oil & Energy Corp. has shut-in its refineries in Sendai, Kashima and Negishi, reports Bloomberg.

According to Platts, other Japanese refiners – Showa Shell, Idemitsu Kosan and Fuji Oil – are all operating their refineries normally.

Nonetheless, an estimated 4.6 million barrels a day of refining capacity has been shut due to the earthquake and tsunamis.

Oil prices in New York fell on news that Japanese refineries have been shut due to the earthquake and following tsunamis. Friday morning, the price of crude oil on the NYMEX dropped below the $100-a-barrel mark for the first time this week.

The International Atomic Energy Agency reported that four nuclear power plants have been shut down automatically because of the natural disaster.

Various ports in Japan have also been shut because of the devastation.

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