The closure could leave seven refineries behind for drivers struggling state gas, leading to higher gas prices, industry experts say.
Another California oil refinery will close next year, increasing the likelihood of putting more pressure on increasing gasoline supply and driver prices.
Texas-based Valero Energy Corporation said on April 16 that it had filed a notice to the California Energy Commission, which aims to idolize, rebuild or halt it at Benicia refineries in Northern California by the end of April 2026.
The refinery also produces aviation fuel that serves San Francisco, Oakland and Sacramento International Airports, and employs 400 skilled, highly paid workers.
Valero’s California operations include the Wilmington refinery in the Los Angeles area, which provides about 5.25% of the state’s fuel. The facility, which is also an asphalt refinery, is not included in the closure notice.
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According to the company, Valero will continue to evaluate alternatives to the remaining business in California.
In a paper provided to the Epoch Times on Wednesday, Valero is facing an increasingly strict regulatory environment as the reason for plant closure, while Valero is facing an increasingly strict regulatory environment.
Closing a century-old site consisting of two plants five miles apart linked by a pipeline will reduce the state’s refinery capacity by about 8%.
Valero and Phillips 66 refineries account for almost a fifth of the state’s gasoline supply. Their absence allowed them to pump up prices.
Californians face 21.77% reductions in refinement capacity and gasoline production between 2023 and 2026, Miche said in his paper.
Prices will be displayed at gas stations in Santa Monica, California on September 13th, 2022. Gas prices are expected to rise after refinery closures. APU Gomes/AFP via Getty Images
“The resulting gap, along with other legislative and regulatory missions that add costs to gallons of gas, will contribute to rising gasoline prices at Californians’ pumps,” Miche said. “California achieved two objectives: … successfully abandoned its control over gasoline supply and at the mercy of foreign providers.”
The Phillips 66 Factory is located in Wilmington, California on November 28th, 2022. The company plans to close the Southern California refinery, which produces around 8% of the state’s gas supply. Mario Tama/Getty Images
The state averaged $4.87 per gallon, but the second highest was Hawaii, with an average price of $4.52.
According to the AAA, the national average was $3.17.
Gov. Gavin Newsom doubled his fight to “take over the big oil” over the past three years, implementing the country’s first regulatory authority to oversee the oil industry.
