SACRAMENTO, Calif. — California’s aggressive transition away from fossil fuels is beginning to take a toll on its workforce. As the Phillips 66 refinery in Los Angeles prepares to close by the end of this month and Valero’s Bay Area refinery faces a similar fate, thousands of skilled workers are facing an uncertain future.
For many, the closures echo the experience of Willie Cruz, a former Powerine Oil Company employee who lost his job when his refinery in Santa Fe Springs shut down 30 years ago. Now, his son Wilfredo Cruz, a 37-year-old pipe fitter at Phillips 66, is preparing for the same outcome.
“There’s not really a real clear plan to get workers from this oil industry into these new fields,” Cruz said. “So, you feel kind of forgotten.”
California’s Shrinking Oil Industry
California was the eighth-largest crude oil producer in the United States in 2024 — a steep decline from its rank as third in 2014, according to the U.S. Energy Information Administration. The Phillips 66 and Valero facilities alone represent nearly 18% of the state’s refining capacity, producing essential jet fuel, gasoline, and diesel.
The Phillips 66 refinery will begin winding down operations this month, with a full shutdown expected by the end of 2025. The company said its decision was driven by “market dynamics,” not by new state regulations.
Valero, meanwhile, plans to idle or cease operations in Benicia by next spring. That refinery contributes roughly 13% of the city’s tax revenue, city officials said.
“It’s a significant and seismic impact to the city,” said Benicia City Manager Mario Giuliani.
State Policy and Mixed Messaging
Governor Gavin Newsom has positioned California as a leader in climate action, but his administration’s recent moves have sent mixed signals.
While Newsom signed legislation to speed up oil well permitting and paused a proposal to penalize oil companies for high profits, he also approved a landmark collective bargaining law for rideshare drivers and continues to advocate for clean energy expansion.
“The governor is committed to supporting displaced oil workers and affected communities,” said Newsom spokesperson Daniel Villaseñor.
Still, workers and local officials say the transition feels disorganized and underfunded.
Programs for Displaced Workers
California’s Displaced Oil and Gas Worker Fund, created in 2022, has allocated $30 million to retrain workers across the state — from Kern County to the Bay Area. The program, however, is set to expire in 2027, with no guarantee of renewal.
Newsom also approved $20 million for a pilot initiative helping former refinery employees plug abandoned oil wells in Kern and Los Angeles counties.
Policy advocates say these measures are a start, but not enough to handle the projected job losses.
“We’re in solidarity with workers who have been displaced and who are looking for relief,” said Faraz Rizvi of the Asian Pacific Environmental Network.
A 2021 study by the University of Massachusetts Amherst estimated that nearly 58,000 oil and gas jobs could disappear in California by 2030, with over half of those workers not yet eligible for retirement.
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Industry Pushback
The Western States Petroleum Association has criticized the state’s approach, warning that climate policies are eliminating stable, high-paying jobs without viable replacements.
“The extremists fighting to close California refineries should explain why they are OK with destroying some of the best blue-collar jobs out there — because we certainly are not,” said Jodie Muller, the group’s president.
Workers like Cruz see both sides. While his current base salary of $118,000 a year offers financial security, he also acknowledges the environmental and health risks of refinery work. He showers immediately after each shift to protect his young son from exposure to chemicals.
As he studies cybersecurity through a state-sponsored training program, Cruz remains hopeful but cautious.
“I went from polluting to helping,” his father once said. Now, his son hopes to do the same — this time from behind a computer screen.
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