I frequently get this error when I paste a valid image URL into the field called Upload Url. This has been going on for months. Some URLs work while others don't. Instagram URLs never work but the problem is not limited to Instagram.
In the past I sometimes would be able to upload the image anyway. Probably because the problem was limited to JavaScript's retrieval of the image. But this no longer works.
The server error message for failure to upload an image from Instagram is 504 Gateway Time-out. Other servers give me Could not retrieve image from URL.