Locator: 48814REFINERY.
I don't think there's a governor today that has marketed himself as much as Governor Gavin Newsom has as a "greenie." Now, planning to run for president in 2027 / 2028, there's a fly in the ointment: really, really high gasoline prices in California next summer, 2026.
This will likely be a stand-alone post. The link was sent to me by a reader. Thank you. I probably would have eventually gotten to it but I do miss a lot of things so I appreciate the link.
California officials are stepping into the fray to urgently find a buyer for Valero’s Benicia refinery before its scheduled closure in April 2026, a rare move that underscores the state’s growing anxiety over fuel security and price volatility. According to Reuters, in an exclusive report on Wednesday, the state has opened talks with potential buyers, including HF Sinclair and at least one unnamed European energy firm, to take over the Bay Area facility and preserve in-state refining capacity.
The 149,000 barrels-per-day refinery is one of just 10 refineries still operating in California. Its shutdown, combined with the planned 2026 closure of Valero’s Wilmington facility in Los Angeles County, could reduce the state’s gasoline and diesel production by nearly 17%.
In a position of desperation, the California Energy Commission is leading the effort to broker a deal, with support from the governor’s office. The move is an attempt to avoid severe market disruptions and cushion consumers from steep price spikes.
The stakes are particularly high. State modeling suggests that removing Benicia from the refining system could push pump prices toward $8 per gallon, particularly during summer demand peaks. Analysts warn that the closures could also reduce fuel inventories and strain supply chains across the western U.S.
As KQED reported earlier this month, Benicia city officials were blindsided by Valero’s June 28, 2025, announcement. Local leaders fear the loss of one of their top employers and taxpayers, Benicia receives roughly 40% of its general fund from refinery-linked revenues.
The way I read this, it's not going to come about without huge political cost and at the end of the day, the writing is on the wall for California: gasoline is only going to get more expensive going forward regardless of whether this refinery "survives." Who knows? Valero is now in a incredibly great position. What if Valero decides to slow-roll the sale or even suggest that it has decided to keep the refinery but with huge give-backs, tax-breaks, etc., from the state. This could get very interesting very, very fast.
Scheduled for closure in April next spring, what might happen if a deal can't be closed by June, and the refinery goes through a typical planned shutdown and then re-start in late September. Wow, that would be a "hot" summer for the governor.
My hunch: everyone will be adults and a solution will be found.