California, August 25, 2025
News Summary
California is poised for significant changes in its oil refinery landscape as the Phillips 66 refinery in Wilmington closes by October 2025, followed by the Valero refinery in Benicia. These closures will result in a loss of approximately 284,000 barrels-per-day of refining capacity, nearly 20% of the state’s total. Concerns arise over potential job losses, with around 1,300 jobs at stake, and rising gas prices projected to increase by as much as $8 per gallon by late 2026. Critics are also questioning regulatory impacts on the oil industry amid these changes.
California is set to witness significant changes in its oil refinery landscape as two major facilities prepare to shut down by 2026. The Phillips 66 refinery in Wilmington will close by October 2025, while the Valero refinery in Benicia is scheduled to cease operations shortly thereafter. This development will result in the loss of approximately 284,000 barrels-per-day of refining capacity, accounting for nearly 20% of the state’s total capacity.
The impact of these closures extends beyond production levels, raising concerns about job losses and their potential repercussions on the local and state economy. Assemblymember Mike A. Gipson has voiced particular concern for his constituents, many of whom work at these refineries. The Phillips 66 facility alone is responsible for approximately 900 jobs, while Valero supports about 400 employees. The impending layoffs could lead to significant economic challenges for communities reliant on this employment.
The decisions to shut down these refineries stem from various factors, including significant regulatory pressures faced by the companies. The Valero refinery’s closure was influenced in part by substantial air quality violation fines, the most notable being an $82 million penalty levied in 2024. Meanwhile, Phillips 66 indicated that the stringent environmental regulations played a critical role in its decision to close its Wilmington facility.
Currently, California processes around 24% of its crude oil needs but consumes significantly more, roughly 13.1 million gallons daily. This reliance on refining has resulted in California facing the highest gas prices in the nation, averaging about $4.85 per gallon compared to a national average of $3.16. Experts have warned that the reduction in local refining capacity could lead to spikes in gas prices, with projections ranging from modest increases of less than $1 to possible surges exceeding $8 per gallon by late 2026.
The closures may necessitate an increased dependence on imported fuel, which could elevate shipping costs and result in heightened emissions from tanker vessels. Furthermore, California legislators are questioning the various state regulatory agencies’ effectiveness in managing the oil and gas sector amid rising fuel prices, indicating a growing concern regarding the balance between environmental regulations and economic sustainability.
These refinery closures are anticipated to further intensify existing economic and environmental challenges, including the longer-term sustainability of the state’s energy landscape and the potential for volatility in fuel prices. The consequences may lead to supply disruptions that impact drivers and consumers significantly.
Criticism has also arisen regarding the California Air Resources Board, which has indicated that it does not actively assess the implications of its regulations on consumers and drivers. Proposed future discussions may revolve around potential redevelopment plans for the closed refinery sites, although such plans could face skepticism and opposition from local communities due to health impact considerations.
As California moves forward with these significant reductions in refining capacity, the state’s ability to manage its energy needs sustainably remains a pressing concern. The public and policymakers will need to navigate the complexities associated with these closures and their far-reaching implications.
FAQ
What are the names of the refineries set to shut down?
The Phillips 66 refinery in Wilmington and the Valero refinery in Benicia are scheduled to close.
How much refining capacity will be lost in California due to these closures?
The closures will eliminate approximately 284,000 barrels-per-day, accounting for nearly 20% of California’s total refining capacity.
What are the anticipated effects on gas prices?
Experts predict that gas prices could increase, with estimates suggesting rises of between less than $1 to potentially exceeding $8 per gallon by late 2026.
How many jobs will be affected by the refinery closures?
Phillips 66 employs around 900 workers while Valero supports about 400 employees, indicating significant job losses in the region.
What are the concerns regarding California’s fuel imports?
Increased reliance on imported fuel may lead to higher shipping costs and greater emissions associated with tanker vessels.
| Refinery Name | Location | Scheduled Closure | Barrel Capacity (per day) | Jobs Lost |
|---|---|---|---|---|
| Phillips 66 | Wilmington | October 2025 | Approx. 124,000 | 900 |
| Valero | Benicia | 2026 | Approx. 160,000 | 400 |
Deeper Dive: News & Info About This Topic
- LAist: Phillips 66 Shutting LA Refineries
- Wikipedia: California
- Energy at Haas: California’s Refinery Closure Drama
- Google Search: California refineries
- KCRA: California Lawmakers, Regulators Clash Over Oil Refineries
- Encyclopedia Britannica: Oil Refinery
- Moneywise: Gas Could Spike to $8 per Gallon
- Google News: California gas prices
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MISSION VIEJO STAFF WRITER The MISSION VIEJO STAFF WRITER represents the experienced team at HEREMissionViejo.com, your go-to source for actionable local news and information in Mission Viejo, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Oso Fit 5K Fun Run and Community Health Fair, Walk Against Drugs & Community Fair, and National Night Out. Our coverage extends to key organizations like the Mission Viejo Chamber of Commerce and Providence Mission Hospital Mission Viejo, plus leading businesses in retail and education that power the local economy such as The Shops at Mission Viejo, Capistrano Unified School District, and Amazon Delivery Station. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HERESanDiego.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
