The large fire erupted after lightning hit a gas tank at a processing facility near Yarnton during a storm on Monday evening.
In a statement, Severn Trent Green Power said the strike at its Cassington facility "caused an explosion in our biogas tanks".
"Thankfully no one has been hurt and we are working with the emergency services to make sure the site is safe so that we can assess the damage as soon as possible," it added.
Residents have been told to stay indoors and shut their windows. Police have also closed the A40 between Wolverton and Eynsham.
A yellow weather warning for thunderstorms and heavy rain was in place for Oxfordshire until 2 a.m. on Tuesday.
In March, a sonic boom was reported across central England - including Oxford.
It was initially treated as a mystery before Essex Police explained it had been caused by two RAF jets escorting a plane.
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