Missile that hit Haifa oil refinery brings renewed urgency to plant’s closure plan

The closure this week of the country’s main oil refinery in Haifa due to a direct hit from an Iranian ballistic missile has refocused attention on the dangers of maintaining such a facility in the middle of northern Israel’s huge metropolitan area.

Residents, environmental activists, and others have lobbied for years to have the Bazan compound closed and the materials it produces imported, due to both the heavy pollution it causes to the area — where cancer and asthma rates are high — and fears of disastrous consequences should it be struck.

On Sunday, the company reported to the Tel Aviv Stock Exchange that localized damage had occurred to pipelines and transmission lines running between facilities, and that some downstream facilities had been shut.

On Monday, it halted trading on the Tel Aviv Stock Exchange “due to uncertainty” (resuming trading on Tuesday) and announced that with “significant” damage to the plant, all of the refinery’s and subsidiary companies’ facilities were shutting down.

It was also revealed that three workers died in a building on the site as a result of Sunday’s attack. A massive fire broke out, trapping them inside a closed facility as flames raged outside and smoke filled the space.

The first to be named was refinery worker Dani Avraham, 59, a father of two from Kiryat Motzkin.

Two of Israel’s three Mediterranean gas platforms — Leviathan and Karish — have also ceased production since Israel’s surprise attack on Iran’s military and nuclear infrastructure began early Friday, triggering waves of Iranian ballistic missile attacks on Israel in return.

Together, the three gas platforms produce around 70 percent of Israel’s electricity.

Meanwhile, Israel’s only other oil refinery, located in the southern coastal city of Ashdod, has also ceased operations. A spokesman explained that it was undergoing a pre-planned “annual refresh,” which would take around two weeks, and that before shutting down, the company had ensured sufficient stocks of materials, such as kerosene for jet fuel, to prevent any shortages.

On Tuesday, the Energy Ministry tried to reassure the public, saying, “There is no expectation of a fuel shortage in the economy. The ministry has prepared in advance, and Israel has fuel and stocks, and no shortage is expected.”

The statement went on, “In a meeting held last night between the professional bodies of the Fuel and Gas Administration and the fuel companies, it was clarified to the companies that despite the damage to Bazan, no difficulty is expected in supplying fuel to the companies.”

“The ministry is conducting ongoing situation assessments and ensuring the continued functional continuity of the fuel economy in Israel, in order to prevent damage to the supply chain.”

Smoke billows from a missile impact site in the northern city of Haifa on June 16, 2025, where three people were killed in a strike on the Bazan oil refinery complex. (Ahmad Gharabli/AFP)

Featuring an iconic cooling tower (formerly two), the Bazan Group Oil Refineries Ltd. site spans 526 acres (2,130 dunams), approximately two kilometers (1.2 miles) from Haifa Bay.

Last year, Bazan supplied 65% of Israel’s diesel fuel for transportation, 59% of its gasoline, and 52% of its kerosene (used for jet fuel and cooking gas), according to information (in Hebrew) sent to the stock exchange in March.

The company is owned by Petrochemical Enterprises, which took over control from ICL (formerly Israel Chemicals Ltd.) in September 2022. According to the stock exchange, 69% of the company is owned by the public through large financial institutions, which means that share volatility affects citizens’ pension funds and savings.

The compound has long been a target of Israel’s enemies.

In June, Hezbollah published a video purporting to show one of its drones flying over the refinery site and other sensitive installations in the area.

Activists call for the closure of the Bazan Oil Refineries in Haifa Bay, northern Israel, June 24, 2019. (Meir Vaknin/Flash90)

Within Israel, residents and non-governmental groups have long pressed for Bazan, and the bay’s heavy industries in general, to be shuttered in light of studies suggesting a link between living in the Haifa Bay area and cancer, as well as infant disorders such as smaller-than-average heads and low weight.

The conglomerate has been repeatedly fined for violating its air pollution permit.

Three years ago, the cabinet decided to shut down the refineries and related oil storage complex within a decade. A Directorate for the Development of Haifa Bay was created within the Prime Minister’s Office. It designed a work plan through 2030.

Haifa Bay, seen from the University of Haifa, April 10, 2024. (Sue Surkes/Times of Israel)

The vision is to transform the bay over the next 20 years into a sustainable area of residential neighborhoods, commerce and employment, clean industry, tourism, and open space.

However, progress depends on the closure of Bazan, and that cannot happen until new infrastructure has been built to import, transport, and store the distillates produced by the oil refinery. Planning for this is at various stages.

Delays of a few months to the directorate’s work mean Bazan’s closure has already been temporarily delayed for six months to the first half of 2030.

Bazan, which failed to respond to The Times of Israel by press time, is fighting closure. According to the Shakuf (Transparent) investigative site (in Hebrew), its workers’ committee has been quietly lobbying Knesset lawmakers against the move and last year hosted a beneath-the-radar tour of Bazan for Knesset Economic Committee members, including chairman David Bitan. (The Facebook post below, from Likud MK Shalom Danino, documents the tour).

The Directorate for the Development of Haifa Bay would not comment on the latest developments at Bazan.

At a conference the directorate hosted last year, its chairman Prof. Avi Simhon (who is also Prime Minister Benjamin Netanyahu’s chief economic adviser) noted that the defense establishment was an early backer of closing Bazan for fear of having to shutter the complex during a major war and being left with crude oil but no distillates.

National Economic Council chairman Prof. Avi Simhon addresses the Knesset committee on the natural resources sovereign wealth fund on August 11, 2020. (Adina Velman)

“If this current war has done something [he was referring to the war against Hamas in Gaza sparked by the terror organization’s murderous invasion of southern Israel on October 7, 2023], it has just sharpened the urgent need to close Bazan, and if someone says different, he’s probably being paid to do so,” he said.

During the confab, Simhon told The Times of Israel that once the storage facilities were complete, the company would close “with or without agreement,” and with only limited state compensation.

The Environmental Protection Ministry said that there was “no danger to the residents of Haifa Bay and the region” as a result of the missile strikes.

Elad Hochman, CEO of the environmental organization Green Course, however, said, “Bazan is a disaster waiting to explode. It is not a question of if, but when.”