California oil workers face an uncertain future in the state's energy
transition
[October 13, 2025] By
SOPHIE AUSTIN
SACRAMENTO, Calif. (AP) — Thirty years ago, Willie Cruz was shocked when
he learned the Southern California oil refinery where he worked was
shutting down.
Cruz, now a 61-year-old living in Arizona, had spent five years working
in the environmental department when Powerine Oil Company said it would
close the plant in Santa Fe Springs, southeast of Los Angeles.
Cruz feared getting laid off again if he stayed in the industry. He
decided to look into respiratory therapy, in part because he’s
asthmatic. A federal job training program paid for his schooling.
“I thought it was pretty cool, you know — go from polluting to helping,
right?” Cruz said.
Now he's advising his son, Wilfredo Cruz, as the Phillips 66 refinery in
Los Angeles where the 37-year-old has worked for 12 years plans to close
by the end of the month.
Thousands — perhaps tens of thousands — of workers could lose jobs in
the coming years as California tries to reduce its reliance on fossil
fuels. Energy company Valero said earlier this year it would close a
refinery in the Bay Area.
California's leading Democrats are grappling with how to confront lost
jobs and high gas prices that the oil industry says are the result of
the state's climate policies.
State energy regulators are negotiating to keep the Valero plant open
and recently backed off a proposal to penalize oil companies for high
profits, while Democratic Gov. Gavin Newsom signed legislation to speed
oil well permitting in the Central Valley. That action came after years
of Newsom declaring he was “taking on big oil.”
That inconsistent messaging has left the industry's workers unsure of
what the future holds.
Refinery closures
California was the eighth-largest crude oil producer in the nation in
2024, down from being the third-largest in 2014, according to the U.S.
Energy Information Administration. The Valero and Phillips 66 refineries
set to close account for roughly 18% of California’s refining capacity,
according to state energy regulators. They both produce jet fuel, gas
and diesel.
The Phillips 66 refinery will start shutting down this month and end
active fuel production at the end of 2025, the company said. The closure
is based on multiple factors and “in response to market dynamics,"
Phillips 66 said.
The announcement came after Newsom signed a law last year aimed at
preventing gas price spikes that allows energy regulators to require
that refineries keep a certain amount of fuel on hand to avoid shortages
when they go offline for maintenance. But the company said its decision
was unrelated to the law.
Phillips 66 said it is “committed to treating all our refinery workers
fairly and respectfully throughout this process.”
Valero announced plans to “idle, restructure or cease refining
operations” at its refinery in the Bay Area city of Benicia by the end
of April. The company didn’t respond to emails seeking comment on the
status of its plans.
Valero pays about $7.7 million annually in taxes to the city, making up
around 13% of Benicia’s revenues, City Manager Mario Giuliani said.
“It’s a significant and seismic impact to the city,” he said of the
planned closure.
Forty-six oil refineries in California closed between 2018 and 2024,
according to the state’s Employment Development Department. The fossil
fuel industry employs roughly 94,000 people in the state, according to
the Public Policy Institute of California.
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Lights from the Phillips 66 Los Angeles Refinery Wilmington Plant
are reflected in the water at dusk, Thursday, Oct. 2, 2025, in Los
Angeles. (AP Photo/Jae C. Hong)
 One study estimated that the state
would lose nearly 58,000 workers in the oil and gas industries
between 2021 and 2030. About 56% of those workers will have to find
new jobs because they are not retiring, according to the 2021 report
by the Political Economy Research Institute at the University of
Massachusetts Amherst.
Supporting displaced workers
Lawmakers approved the Displaced Oil and Gas Worker Fund in 2022 to
help workers receive career training and connect with job
opportunities. The state has since awarded nearly $30 million
overall to several groups to help workers across the state — from
oil-rich Kern County to Contra Costa County in the Bay Area.
But the funding is set to run out in 2027, and state lawmakers
wrapped up their work for the year without an agreement on whether
to extend it.
Newsom spokesperson Daniel Villaseñor said the governor is committed
to supporting displaced oil workers “and affected communities in
transitioning into new and emerging jobs and economic
opportunities.”
Newsom approved $20 million in the state’s 2022-2023 budget for a
pilot program to train workers in the industry who've lost their
jobs to plug abandoned oil wells in Kern and Los Angeles counties.
California needs a clear plan for workers who will lose jobs because
of the state’s energy transition, said Faraz Rizvi, the policy and
campaign manager at the Asian Pacific Environmental Network.
“We’re in solidarity with workers who have been displaced and who
are looking for a relief to ensure that they’re able to find work
that is important for their communities,” Rizvi said.
But Jodie Muller, president and CEO of the Western States Petroleum
Association, said the state can protect jobs by changing its climate
policies.
“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,” she said in a
statement.
Life as an oil worker
For many workers, the industry offers an opportunity to earn a
living wage without a college degree.
Wilfredo Cruz was attracted in part by the paycheck. After more than
a decade, he makes a base salary of $118,000 a year as a pipe fitter
at the Phillips 66 refinery.
But there are downsides.
Every day when Cruz gets home from work, he showers immediately to
try to shield his son from exposure to any harmful chemicals. He
also never lets the 2-year-old ride in the car he takes to work.
Now he's enrolled in an online cybersecurity training course,
schooling paid for by the state program that's set to expire in the
next couple of years.
“There’s not really a real clear plan to be able to get workers from
this oil industry into these new fields,” he said. “So, you feel
kind of forgotten.”
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