Some residents reported hearing an aircraft flying low overhead shortly before the first explosion at around 6 a.m. (0600 GMT) but police said there was no evidence of a plane crash.
Nearby Luton Airport remained open and flights were operating normally. Firefighters, meanwhile, scrambled to extinguish the blaze at the Buncefield Oil Terminal, near Hemel Hempstead.
The British Broadcasting Corp. reported an unspecified number of casualties, which police and local fire brigade could not immediately confirm.
The Ramada Hotel in Hemel Hempstead, about two miles from the oil terminal, was evacuated after windows were shattered by the blast. Two guests received minor injuries from broken glass and were treated at the hotel, said Calum Russell, marketing director for Jarvis Hotels Ltd. All 187 guests had since returned to their rooms, Russell said.
There was nothing to indicate the blasts were acts of terrorism, police said, although the al Qaeda terror network and other terrorist groups have threatened to target fuel deposits.
Britain has been on edge since the July 7 bombing, which killed 56 people including four suicide bombers, and a failed attack two weeks later on July 21.
Residents in Hemel Hempstead reported a loud boom and some felt their houses shake. The blast was so large it was felt throughout a large part of London and southeast England.
"Around 6 a.m. as we were sleeping, there was a mighty explosion — a thunderclap that woke me up," said Neil Spencer, 42, who lives about three-quarters of a mile from the terminal. "It was fireball after fireball, truly amazing."
The area around the fuel depot was being evacuated. Police said many roads and highways had been closed.
"There was a loud boom and the house shook violently," said Duncan Milligan, of Hemel Hempstead, who said the blast woke him up. "I am about three miles from where the explosion took place but I can see flames high in the sky and smoke billowing everywhere. There is clearly a building on fire near the motorway and police and emergency services are everywhere."
Resident Graeme North reported a "great column of smoke" at the oil depot and said the blast damaged several houses nearby. "The garage door was blown open," he told Sky. "The blast wave blew bath panels off."
Local resident Richard Ayers said a massive column of smoke rose into the air and said the force of explosions had blown the roofs off houses near the oil depot. "It is like it is doomsday," he told the BBC.