California Posted Significant Dip in Crude Oil Refining Capacity

SEATTLE (Oil Monster): Over the past many years, California's capacity to refine crude oil has been significantly declining. By the end of the next year, the state's operational refineries will have decreased from a total of about 20 refineries 20 years ago to just 7.

Approximately 170,000 barrels per day (bpd) of processing capacity will be eliminated when Valero Energy's Benicia refinery, which makes up almost 9% of the state's total capacity, shuts down, according to reports. It should be mentioned that the refineries have been having difficulties because of the state's regulatory framework.

As part of its attempts to transition away from fossil fuels, Valero Energy CEO Lane Riggs linked the closing of the Benicia refinery to California's extremely stringent regulatory constraints. He said that the refinery's maintenance costs have been significantly greater than those of the company's Wilmington plant, which is located close to Los Angeles.

The California Energy Commission (CEC) was recently encouraged by California Governor Gavin Newsom to increase efforts to maintain refineries by guaranteeing steady and reasonably priced fuel supplies.

California's gasoline prices are among the highest in the country as a result of the state's severe reliance on imports and the sharp drop in its refining capacity.

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