Houston-based Phillips 66 has announced the closure of its Los Angeles refinery in the fourth quarter of 2025, impacting 600 employees and 300 contractors. The refinery produces 8% of California’s gas. CEO Mark Lashier cited uncertain long-term sustainability and market dynamics as reasons for the closure.
The closure comes after Governor Gavin Newsom signed Assembly Bill X2-1, aimed at preventing price spikes by requiring oil refiners to maintain adequate supplies. However, energy economics expert Robert Michaels believes the closure was due to declining fuel demand in the state, with the planning process for closure being a lengthy one.
Critics of Newsom, like Assembly Republican Leader James Gallagher, blamed the closure on his policies, claiming it will lead to job losses and gas price hikes. State Senator Steve Bradford expressed concerns about higher prices and increased pollution due to imports from countries with lower environmental standards.
The closure of the Phillips refinery reflects a long-running trend of declining refining capacity in California. Chevron, the state’s biggest oil company, also recently announced its headquarters move to Houston. Newsom’s anti-oil industry stance, including a ban on new gas-powered cars by 2035, has drawn criticism for its potential impact on California’s energy supply.
The closure of the Phillips 66 refinery has sparked debate over the future of California’s energy industry and the consequences of state policies on employment and environmental standards. With Newsom nearing the end of his term, the impact of his energy initiatives remains to be seen.
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