Wednesday, August 6, 2025 – The Energy Marketers of America (EMA) today issued an urgent alert regarding significant risks to motor fuel supplies and consumer access across the West Coast, stemming from the planned closures of two major California refineries: Phillips 66 in Wilmington and Valero in Benicia. These shutdowns, expected over the next 12 to 18 months, are projected to reduce California’s gasoline refining capacity by approximately 17 percent, potentially leading to fuel shortages, elevated prices, and broader economic impacts in California, Nevada, Arizona, and the Western U.S.
In a letter addressed to President Trump, EMA highlighted the interconnected nature of Western energy markets and the vulnerability of neighboring states to California’s refining disruptions. California refineries supply more than one-third of Arizona’s gasoline and 86 percent of Nevada’s motor fuels. Combined with recent unplanned events—including refinery fires earlier this year and transitions to renewable fuel production—these closures could result in a 25 percent overall loss in California’s refining output, exacerbating supply constraints in adjacent states.
“Past disruptions in California’s refining capacity have consistently triggered immediate price spikes in Arizona and Nevada,” the letter states. “For instance, unplanned maintenance in the fall of 2022 and late 2023 led to elevated gasoline prices not only in California but also in these markets. The sequential closures of the Phillips 66 Wilmington facility and the Valero Benicia refinery could similarly incite price volatility.”
The Valero refinery accounts for nine percent of California’s refining capacity, while the Phillips 66 facility contributes about eight percent. Logistical challenges in sourcing alternatives include limited pipeline capacity—the El Paso to Arizona pipeline is already at full volume—and Arizona’s reliance on a boutique fuel blend, which complicates imports. Trucking or importing additional supplies would be costly and likely amplify price volatility across the region and potentially nationwide.
EMA noted limited mitigation options for Nevada and Arizona due to insufficient infrastructure. Nevada primarily relies on California pipelines, with only about 15 percent of its fuel arriving via the SF Holly Pipeline (UNEV Pipeline) from Utah. Fuel wholesalers may need to source from distant regions like the Gulf Coast, driving up costs for consumers everywhere.
EMA expressed encouragement over California’s recent efforts to ease permitting for new oil wells, streamline refinery approvals, and phase out the state’s unique fuel blend in favor of a more fungible standard to help stabilize prices. The organization urged a comprehensive understanding of Western energy market interconnections and suggested the administration consider authorities under the Defense Production Act for temporary solutions if needed.
“We stand prepared to collaborate with the White House and the Western Governors Association on this critical energy security issue,” the letter concludes.