Valero Energy Corporation announced it would be idle or shut down its Benicia refinery in California, just the latest in the state's fossil fuel company's exit. [emphasis, links added]
Six months ago, Phillips 66 announced the closure of its Los Angeles-area refinery by the end of the year — and then dated through October — in the months leading up to that, Chevron announced the move of its headquarters from San Ramon, California to Houston.
After the two refineries closed, it is unclear where California can find more gasoline and other finished petroleum products, such as jet fuel, to meet demand.
All options for disposal in the state are expensive.
Residents in the Golden State have paid the highest gasoline prices in the nation, and the state's lawmakers have shown no signs of turning the course on its anti-fossil fuel agenda, expelling the state's oil industry.
Warning is ignored
Over the past few years, Democratic Gov. Gavin Newsom has signed the law, some of the rules that the state's oil and gas industry is unpopular because such companies are considered bad players.
Last October, he introduced a law that requires state oil refineries to maintain minimum fuel reserves to prevent shortages from causing peak gasoline prices.
In an announcement about the proposal, Newsom accused oil companies of high gasoline prices and promised further regulation of the industry would solve residents' problems.
Democratic fellow Arizona Gov. Katie Hobbs and Nevada Gov. Joe Lombardo, a Republican, whose state borders California, wrote to Newsom, urging him not to sign refinery regulations into law, believing that it would lead to soaring gasoline prices and shortages.
Their warnings, as well as many other critics' warnings, have been ignored. Two days after Newsom signed the law, Phillips 66 announced it would close its Los Angeles refinery.
Michael Mische, a professor and management consultant at the University of Southern California, told Just news It's no surprise that the oil company must close in April 2026, which is expected to be held in April 2026.
The loss will reduce California's refining capacity by 22%.
“That’s one-fifth of what you circulate,” Mitch said. “Demand won’t drop, so there’s a big gap between gasoline supply and demand.”
Mische said the state consumes about 33 million gallons of gasoline a day, and almost all of it is produced by in-state refineries.
In 2035, California’s electric vehicle authorization will be launched, prohibiting the sale of all gas vehicles in the state. Mische suspects other refineries will soon join the Exodus.
“It's all legislation,” he said. “These refineries have no motivation to stay in the state. They have no motivation to invest.”
Chevron has two refineries in California, which together account for nearly 40% of the state's refining capacity. However, Mische said only about 3% of Chevron's sales are generated in California.
“They have no really compelling reasons to stay by 2030. I personally think they are next,” he said.
Chevron’s vice president of fuel Mike Vomund told KCRA 3 last week Over the past 20 years, the state's policies have made it difficult for the oil industry to operate.
He won't speculate on what might happen, but he said the state's lawmakers are making it “uninvestable.”
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