California, August 25, 2025
News Summary
California is bracing for a significant gasoline supply crisis due to the imminent closures of two major refineries, which jeopardize 18% of the state’s refining capacity. Predictions indicate gas prices may spike by 15 to 30 cents per gallon, impacting families and businesses across the state. The California Energy Commission is addressing availability concerns while proposed legislation by Governor Gavin Newsom aims to stabilize the market amidst rising operational challenges and regulatory pressures. This situation underscores the reliance on imported fuel and the urgent need for local production.
California is facing a significant gasoline supply crisis as two of its major refineries, Phillips 66’s Wilmington facility and Valero’s Benicia plant, prepare to close, bringing 18% of the state’s refining capacity at risk. The impending closures are expected to trigger a substantial spike in gas prices, with experts predicting increases ranging from 15 to 30 cents per gallon in the short term. This situation has been labeled an affordability crisis, placing additional pressure on both businesses and working families across the state.
The California Energy Commission (CEC) is actively addressing concerns regarding potential fuel availability and affordability. With California’s economy heavily reliant on affordable fuel, this issue is particularly pressing in economically vital areas like Orange County, where sectors such as advanced manufacturing, life sciences, technology, and tourism all depend on reasonable fuel prices. Currently, gasoline prices in California average $1.47 higher than the national average, intensifying the pressure that high fuel costs place on residents and businesses alike.
Longstanding worries about California’s regulatory environment have affected local oil production and refining operations, contributing to the economic challenges faced by the region. In an effort to address the ramifications of refinery closures, Assemblymember Cottie Petrie-Norris convened an oversight hearing, emphasizing the need for transparency and urgent legislative action.
As these closures loom, state officials are concerned about an increased reliance on imported fuel, which may not adhere to the same environmental standards as fuel produced domestically. Frustration has also arisen among some lawmakers regarding the approach of state regulators, who have been perceived as neglecting the consumer impact of their decisions relating to the oil and gas industry.
In response to these challenges, proposed legislation by Governor Gavin Newsom seeks to stabilize California’s petroleum market and boost oil production within the state. This includes initiatives to fast-track drilling permits in select regions. However, environmental groups have expressed strong disapproval, denouncing the proposed bill as overly favorable to the oil industry and potentially harmful to existing environmental protections.
The legislation aims to facilitate the ongoing operation of certain refineries while tackling the threat of escalating oil imports, which could pose significant risks to price stability for consumers. Key officials from state regulatory agencies have been called to explain the implications of refinery closures on fuel prices and overall supply.
The current situation reveals a shifting relationship between California’s government and the petroleum industry, suggesting a potential increase in collaboration to ensure a stable fuel supply amid regulatory pressures. Analysts have warned that the closure of these refineries may necessitate heightened imports of oil to avoid supply disruptions, further exacerbating the risk of price volatility for consumers.
Key Impacts of Refinery Closures
- Gas Price Spike: Increases between 15 to 30 cents per gallon expected.
- Affordability Crisis: Significant economic pressure on California families and businesses.
- Reliance on Imports: Increased dependence on imported fuel may occur.
- Legislation Proposals: Governor Newsom’s bill aims to stabilize the market and enhance local oil production.
Background Context
California’s regulatory environment has long posed challenges for local oil production and refining, contributing to economic pressures. The CEC is monitoring the closures and their implications closely, while discussions continue about how to address supply and price concerns while balancing environmental protections and industry needs.
Frequently Asked Questions
- What are the closures of the refineries in California?
- The Phillips 66 Wilmington facility and Valero’s Benicia plant are set to close, risking 18% of the state’s refining capacity.
- How will these closures affect gas prices?
- Experts predict a spike of 15 to 30 cents per gallon in gas prices in the short term due to reduced refining capacity.
- What is the California Energy Commission doing about this situation?
- The CEC is addressing concerns about fuel availability and affordability as a reaction to the pending refinery closures.
- How does California’s fuel price compare nationally?
- Gas prices in California average $1.47 more than the national average, significantly affecting affordability for consumers.
- What actions are being proposed by the state government?
- Governor Newsom has proposed legislation to stabilize the petroleum market and enhance oil production while addressing the impact of refinery closures.
Chart on Key Features of California’s Gasoline Supply Crisis
| Feature | Details |
|---|---|
| Refinery Closures | Phillips 66 Wilmington and Valero Benicia plants |
| Impact on Fuel | 18% reduction in refining capacity |
| Price Increase Projection | 15 – 30 cents per gallon |
| Current Price Comparison | $1.47 higher than national average |
| Legislative Action | Proposed stabilization and production enhancement bill |
Deeper Dive: News & Info About This Topic
- California’s Refinery Closure Drama
- A Do-Over for Newsom on Refinery Shutdowns
- California Lawmakers and Regulators Clash on Refineries
- Gas Prices Could Soar with Refinery Closures in California
- California Steps to Find Buyer for Valero Refinery
- Wikipedia: Gasoline
- Google Search: California refinery closures
- Google Scholar: California refinery economics
- Encyclopedia Britannica: Oil refinery
- Google News: California gas prices refinery closures
Author: STAFF HERE LOS ANGELES WRITER
LOS ANGELES STAFF WRITER The LOS ANGELES STAFF WRITER represents the experienced team at HERELosAngeles.com, your go-to source for actionable local news and information in Los Angeles, Los Angeles 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 the LA Auto Show, Hollywood Film Awards, and the Los Angeles Marathon. Our coverage extends to key organizations like the Los Angeles Area Chamber of Commerce and the Los Angeles Tourism & Convention Board, plus leading businesses in entertainment and technology that power the local economy such as Warner Bros. and SpaceX. As part of the broader HERE network, including HEREAnaheim.com, HERECostaMesa.com, HEREHuntingtonBeach.com, and HERESantaAna.com, we provide comprehensive, credible insights into Southern California's dynamic landscape.
