A recent article posted by The Epoch Times, “Phillips 66 to Close Los Angeles Oil Refinery,” explains how Phillips 66 is shutting down one of its refineries in response to uncertainty and “market dynamics;” uncertain dynamics created by the state’s climate and energy policies. This is true. California’s government is actively hostile towards anything related to oil and gas, so refineries shutting down should not come as a surprise.
Epoch reports that Phillips 66 “said on Oct. 16 that it plans to shut down its refinery in the Los Angeles area of California in the fourth quarter of 2025.” CEO Mark Lashier released a statement explaining that uncertainty and “market dynamics” affected their confidence in the long term “sustainability” of the plant and were responsible for Phillips 66 choosing the site for closure. Another spokesperson told Epoch that “low profitability” compared to other company assets was a factor, but claimed that Assembly Bill X2 – a bill that applies heavier regulatory burdens on oil refiners—was not strictly responsible. The spokesperson told Epoch that Phillips 66 isn’t quitting California entirely, but will find “new ways to serve California markets” which will increasingly include importing gasoline.
Because of the shutdown, California will lose production of 85,000 barrels of gasoline and 65,000 barrels of diesel and jet fuel every day.
Other oil companies responded more honestly and forceful to California’s new efforts to dictate refinery prices, with one Chevron executive stating flat out that “California’s policy choices have led to a gasoline shortage by driving suppliers away,” in a letter sent to the California legislature back in January.
Although Phillips 66 tried to play nice with California’s government, by saying that the particular bill wasn’t responsible, others Epoch interviewed were more directly tied the closure and California’s high gasoline prices to the state’s anti-fossil fuel policies. California Fuel and Convenience Alliance’s governmental affairs and regulatory director Alessandra Magnasco told Epoch that “[t] here is no mystery to our high gas prices—exploding overhead costs to run our stations, costly environmental regulations, and now, with even less supply in the market, every Californian will end up paying higher prices in this government-created energy crisis.” She went on to say that “refinery closures are a direct result of policies that make it increasingly difficult to maintain and expand critical infrastructure.”
This is absolutely correct, and good on Epoch for reporting it.
California’s fuel prices are consistently higher than the national average, currently sitting at $4.65 per gallon versus the national average of $3.19, according to AAA’s gas price tracking website. Californians already pay about $1.42 per gallon in state and federal taxes, and each new fuel standards rule and bit of anti-oil legislation pushes the costs for fuel in the state higher.
Importing fuel from out of state is going to make it more expensive, and it is unlikely that Phillips is the only oil refiner that will soon be feeling the crush.
Higher fuel prices in California will make everything more expensive for Californians, not just filling their tanks, because as Climate Realism previously reported in “Thanks, Center Square, For Reporting on the Effects of High Fossil Fuel Prices on Food Prices,” high fuel prices impact the cost of food in particular. Diesel fuel powers trucks and tractors and other equipment necessary for planting and harvest, as well as eventual transportation and processing.
The worst part is, California is not bringing just themselves down with their insanity – they are dragging other states down with them. California refineries export fuel to neighboring states like Nevada and Arizona, and their governors openly opposed the bill because of the impact it will have on their own fuel prices.
Imagining that laying yet another stack of regulations on top of the already overburdened California oil and gas industry would not result in refinery and other fuel business closures is ignorant. The Epoch Times does a good job of pointing out the implications of California’s energy policies, displaying the real casualties of Newsom’s and the Democratic leadership in the state’s efforts to restrict fossil fuel use, lost jobs in the state and residents paying higher prices.
