Another California Refinery Closure Looms Amid Regulatory Pressures
Valero Refining (NYSE: VLO) has notified California regulators of its intention to possibly idle, restructure, or permanently cease operations at its Benicia oil refinery by April 2026, further accelerating the decline of the state’s refining sector.
“We understand the impact that this may have on our employees, business partners, and community, and will continue to work with them through this period,” stated CEO Lane Riggs.
Valero’s announcement closely follows Phillips 66’s decision to shutter its Los Angeles area refinery by October of this year, highlighting a growing trend of refineries exiting California. The Benicia refinery, with its daily processing capacity of 145,000 barrels, ranks as the state’s sixth-largest.
The timing of Valero’s announcement appears connected to recent local regulatory shifts. Just two weeks ago, Benicia city officials, citing years of unlawful emissions spanning from 2003 to 2019, approved more stringent oversight of refinery pollution. City Manager Mario Giuliani characterized Valero’s move as “a moment of significant transition for our city and community.”
While the departure of refining capacity aligns with California’s broader environmental and regulatory strategy, the immediate effects include potential job losses, disruption to local economies, and possible increases in fuel import dependency.
Valero’s potential exit, and other refineries, underscores an ongoing tension on California’s aggressive climate and regulatory policies–they may be succeeding environmentally but at the immediate expense of economic stability and energy infrastructure resilience.
Information for this story was found via San Francisco Chronicle and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
