Here's something most people don't realize: While California pushes aggressively toward a greener future, tens of thousands of workers are being left behind with no clear safety net. And this is the part that's sparking heated debate across the state.
California's Petroleum Workers Navigate a Cloudy Path Forward Amid the State's Shift Away from Fossil Fuels
SACRAMENTO, Calif. -- Three decades have passed since Willie Cruz experienced the jarring news that the Southern California petroleum refinery employing him would permanently cease operations.
Today, Cruz is 61 years old and resides in Arizona. Back then, he had dedicated five years to working within the environmental division when Powerine Oil Company announced the closure of its facility located in Santa Fe Springs, an area situated to the southeast of Los Angeles.
The experience left Cruz deeply concerned about facing another layoff if he remained within the petroleum sector. He began exploring respiratory therapy as an alternative career path, a choice influenced partly by his own struggle with asthma. His educational expenses were covered through a federally funded job retraining initiative.
"I found it genuinely inspiring, you understand — transitioning from contributing to pollution to actually helping people heal, correct?" Cruz reflected.
Fast forward to today, and he finds himself guiding his son, Wilfredo Cruz, through a strikingly similar situation. The younger Cruz, now 37, has dedicated 12 years to the Phillips 66 refinery in Los Angeles, which has announced plans to shut down operations before the month concludes.
The scale of potential job losses is staggering. Thousands of workers — possibly even tens of thousands — face the prospect of unemployment in the years ahead as California intensifies its efforts to decrease dependence on fossil fuel energy sources. Energy corporation Valero made headlines earlier this year by revealing plans to shutter a refinery facility in the Bay Area.
But here's where it gets controversial: California's Democratic leadership finds itself caught in a difficult balancing act, struggling to address both mounting job losses and escalating gasoline prices that the petroleum industry attributes directly to the state's environmental regulations.
State energy officials are currently in negotiations attempting to prevent the Valero facility from closing and have recently withdrawn a controversial proposal that would have imposed financial penalties on oil corporations for excessive profit margins. Meanwhile, Democratic Governor Gavin Newsom approved legislation designed to accelerate the permitting process for oil wells in the Central Valley region. This move appears contradictory, especially considering Newsom spent years publicly positioning himself as someone who was "taking on big oil."
This mixed messaging and policy inconsistency has created confusion and anxiety among industry workers who are left wondering what their professional futures hold.
According to data from the U.S. Energy Information Administration, California ranked as the nation's eighth-largest crude oil producing state in 2024, representing a significant decline from its third-place position just a decade earlier in 2014. The two refineries operated by Valero and Phillips 66 that are scheduled for closure represent approximately 18% of California's total refining capacity, state energy regulators report. Both facilities produce essential products including jet fuel, gasoline, and diesel.
The Phillips 66 refinery will begin its shutdown process this month, with active fuel production scheduled to cease entirely by the end of 2025, according to company statements. The closure decision is based on numerous considerations and comes "in response to market dynamics," Phillips 66 explained.
The announcement followed Newsom's signing of legislation last year specifically designed to prevent sudden gasoline price increases. The law grants energy regulators authority to mandate that refineries maintain specific fuel reserves to prevent shortages during scheduled maintenance shutdowns. However, the company maintains its closure decision was made independently and is unrelated to this legislation.
Phillips 66 stated it remains "committed to treating all our refinery workers fairly and respectfully throughout this process."
Valero publicly announced intentions to "idle, restructure or cease refining operations" at its Bay Area refinery located in the city of Benicia before the end of April. The company has not responded to multiple email requests seeking updates on the current status of these plans.
Valero contributes approximately $7.7 million in annual tax revenue to the city, accounting for roughly 13% of Benicia's total revenues, according to City Manager Mario Giuliani.
"It represents a significant and seismic impact to the city," he stated regarding the anticipated closure.
The numbers tell a sobering story: Between 2018 and 2024, forty-six oil refineries throughout California permanently closed their doors, according to data from the state's Employment Development Department. The fossil fuel sector currently employs approximately 94,000 individuals across the state, based on figures from the Public Policy Institute of California.
One comprehensive study projected that California would experience the loss of nearly 58,000 workers from the oil and gas sectors between 2021 and 2030. Approximately 56% of these displaced workers will need to secure new employment because they won't be eligible for retirement, according to the 2021 research report published by the Political Economy Research Institute at the University of Massachusetts Amherst.
In 2022, state lawmakers established the Displaced Oil and Gas Worker Fund to provide career retraining assistance and connect workers with new employment opportunities. Since its creation, the state has distributed nearly $30 million in total funding to various organizations supporting workers throughout the state — spanning from oil-rich Kern County to Contra Costa County in the Bay Area.
However, this funding is scheduled to expire in 2027, and state legislators concluded their annual session without reaching consensus on whether to extend the program.
Daniel Villaseñor, a spokesperson for Governor Newsom, stated the governor remains committed to supporting displaced petroleum workers "and affected communities in transitioning into new and emerging jobs and economic opportunities."
Newsom authorized $20 million in the state's 2022-2023 budget for a pilot initiative designed to retrain industry workers who have lost employment to plug abandoned oil wells throughout Kern and Los Angeles counties.
According to Faraz Rizvi, the policy and campaign manager at the Asian Pacific Environmental Network, California urgently needs a comprehensive, clearly defined plan for workers who will lose their livelihoods due to the state's energy transformation.
"We stand in solidarity with workers who have been displaced and who are seeking relief to ensure they're able to find meaningful work that benefits their communities," Rizvi emphasized.
And this is the part most people miss: Jodie Muller, president and CEO of the Western States Petroleum Association, argues the state could preserve these jobs by modifying its climate regulations.
"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 declared in a public statement.
For countless workers, the petroleum industry represents a pathway to earning a living wage without requiring a four-year college degree.
Wilfredo Cruz was drawn to the field partly because of the compensation package. After investing more than ten years in the industry, he currently earns a base salary of $118,000 annually working as a pipe fitter at the Phillips 66 refinery.
But the job comes with significant drawbacks and health concerns.
Every single day when Cruz returns home from his shift, he immediately showers in an effort to protect his young son from potential exposure to hazardous chemicals. He also maintains a strict rule: his 2-year-old is never permitted to ride in the vehicle he drives to work.
Currently, he's pursuing an online cybersecurity training program, with tuition covered by the state-funded program that's scheduled to sunset within the next couple of years.
"There's not really a clear, concrete plan in place to successfully transition workers from this oil industry into these emerging fields," he explained. "So, you end up feeling somewhat forgotten and abandoned."
So here's the question that demands an answer: Is California moving too fast on climate action without adequately protecting the workers who've powered the state's economy for generations? Or is the oil industry exaggerating the impact to protect profits? What do you think — should the state prioritize environmental goals or job security first, or is there actually a way to do both effectively? Drop your thoughts in the comments below.
