Fastly Magento2 Deep Image Optimization "Failed to shrink image" on product lists

The "Failed to shrink image" warning was a red herring: the actual cause was a missing canvas query argument on the image URLs, so the image optimizer had no target dimensions to shrink to. Adding the canvas argument (e.g. &canvas=262:262) produced correctly sized images, and the reporter confirmed that was the issue. Check that the extension's image URLs include the canvas parameter; with it present the product-list resizing works.

Source: https://github.com/fastly/fastly-magento2/issues/287

Source: https://github.com/fastly/fastly-magento2/issues/287