Valero Has Been Forced to Shut Down a Texas Refinery After an Explosion. Here's What Investors Need to Know.

Key Points
Valero had to shut down its largest refinery following an explosion.
The cause wasn't related to the war.
The facility should restart soon.
- 10 stocks we like better than Valero Energy ›
An explosion caused Valero (NYSE: VLO) to temporarily shut down its largest oil refinery on Monday. The 435,000-barrel-per-day (BPD) Port Arthur, TX, facility processes heavy sour crude oil into gasoline, diesel, and jet fuel.
Here's what investors need to know about the incident and its impact on the energy market.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
An accident
An explosion occurred at a diesel hydrotreater unit in Valero's Port Arthur, TX, refinery on Monday. Diesel hydrotreaters use hydrogen to remove sulfur from motor fuels during their production to comply with environmental regulations. The explosion at the 47,000 BPD unit sparked a fire, forcing Valero to shut down the entire refinery to contain it. The explosion didn't cause any injuries.
There had been initial online speculation that the explosion could be in retaliation for the ongoing conflict between the U.S. and Iran, which has had the energy market in its crosshairs. However, that wasn't the case. Valero said an unforeseen release of process fluid caused the explosion.
No impact on the oil market
Valero is already preparing to restart the idled refinery. It should be back online soon and producing near maximum capacity. That's positive news for Valero, as refining margins are strong right now due to the conflict with Iran and the worldwide shortage of oil and refined products.
The short shutdown is also a relief to the energy market, which faces an uncertain time frame for when the Strait of Hormuz will reopen. Before the war, 20% of the world's oil supplies moved out of the Persian Gulf through that narrow passageway. The industry also faces the potential of more damage to energy infrastructure in the Persian Gulf if the war escalates. Iran has already damaged key liquified natural gas (LNG) infrastructure in Qatar, causing 17% of the country's capacity to go offline for the next three to five years for repairs. There are some concerns that Iran could seek to retaliate directly against U.S. energy infrastructure if the conflict continues.
Uncertain times
The energy market is on edge due to the war with Iran. While an explosion caused Valero to shut down its largest refinery, it should be back online in a few days. As a result, it won't add to the current stress on the energy market. However, the potential remains high that the war could further damage global energy infrastructure, keeping energy prices high long after it ends. That's a risk investors need to monitor.
Should you buy stock in Valero Energy right now?
Before you buy stock in Valero Energy, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Valero Energy wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $490,325!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,074,070!*
Now, it’s worth noting Stock Advisor’s total average return is 900% — a market-crushing outperformance compared to 184% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of March 25, 2026.
Matt DiLallo has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.