California oil workers are confronting an increasingly uncertain future as the state’s energy transition accelerates, with major refinery closures threatening thousands of jobs across the industry. The planned shutdowns of Phillips 66 and Valero Energy facilities highlight the complex challenges facing workers and communities dependent on fossil fuel industries, according to recent analysis of California’s shifting energy landscape.
Personal Stories Highlight Industry Transition
Willie Cruz’s experience mirrors the challenges facing today’s oil workers. Thirty years ago, he was shocked when the Southern California oil refinery where he worked announced its closure. Cruz, who had spent five years working in the environmental department at Powerine Oil Company’s Santa Fe Springs facility southeast of Los Angeles, decided to pivot completely after the shutdown.
“I thought it was pretty cool, you know — go from polluting to helping, right?” said Cruz, who transitioned to respiratory therapy with federal job training assistance. Now he’s advising his son, Wilfredo Cruz, as the Phillips 66 refinery where the 37-year-old has worked for 12 years prepares to close by month’s end.
Widespread Job Losses Loom for California Workers
Thousands—potentially tens of thousands—of workers could lose employment in coming years as California intensifies efforts to reduce fossil fuel dependence. The scale of potential job losses represents one of the most significant labor market transitions in recent state history, with industry experts noting the particular challenges for specialized refinery workers.
The economic impact extends beyond direct employment. Valero Energy pays approximately $7.7 million annually in taxes to Benicia, comprising about 13% of the city’s revenue—highlighting how refinery closures affect community funding for essential services.
Policy Inconsistency Creates Uncertainty
California’s leading Democrats are grappling with how to address both job losses and high gas prices that the oil industry attributes to state climate policies. The contradictory approaches have created confusion about the state’s energy direction, with additional coverage revealing the political tensions.
State energy regulators recently backed off a proposal to penalize oil companies for high profits while simultaneously negotiating to keep the Valero plant operational. Meanwhile, Democratic Governor Gavin Newsom signed legislation to accelerate oil well permitting in the Central Valley—a surprising move after years of declaring he was “taking on big oil.”
Refinery Closures Reshape California’s Energy Landscape
The planned closures represent a significant shift in California’s energy production capacity. According to state energy regulators, the Valero and Phillips 66 refineries account for approximately 18% of California’s refining capacity, with both facilities producing:
- Jet fuel for aviation
- Gasoline for vehicles
- Diesel for transportation and industry
California’s position as a crude oil producer has declined substantially, dropping from the nation’s third-largest producer in 2014 to eighth-largest in 2024, according to recent analysis of federal energy data.
Company Timelines and Worker Transition Plans
Phillips 66 announced its Los Angeles refinery will begin shutdown procedures this month, with active fuel production ending by late 2025. The company cited “market dynamics” as the primary factor, noting the decision was unrelated to recent state legislation aimed at preventing gas price spikes.
The company stated it remains “committed to treating all our refinery workers fairly and respectfully throughout this process,” though specific transition assistance details remain unclear. Meanwhile, related analysis suggests similar workforce challenges may emerge across the energy sector.
Valero plans to “idle, restructure or cease refining operations” at its Benicia facility by April’s end, though the company hasn’t commented on current status updates. The uncertainty creates additional stress for workers and communities anticipating economic impacts.
Broader Implications for Energy Workforce
The California refinery closures reflect larger transitions occurring across energy sectors worldwide. As industries evolve, workers face the dual challenge of adapting skills while navigating economic uncertainty—a pattern industry experts note is occurring across multiple sectors beyond energy.
The success of worker transition programs will likely influence future energy policy decisions, with the California experience serving as a potential model—or cautionary tale—for other states pursuing similar energy transitions while balancing economic stability and workforce development.
