The second-largest US refiner, Valero Energy Corp. (VLO.US), plans to lay off 237 workers at its Benicia refinery as the company moves to shutter one of California's few remaining fuel production plants. In a letter to state employment regulators and local officials, Valero indicated the closure is expected to be permanent, with the 237 positions being eliminated between March 15 and July 1. These affected employees, who are not represented by a union, constitute the vast majority of the facility's total workforce of 348 people.

Refinery Manager Lauren Bird wrote in the letter, "We do not intend to collaborate with the local workforce development board or any other entity to provide follow-up services." Bird's own position is also among those being cut. The Texas-based oil company announced its plan to close the plant in 2025, and final efforts by Governor Gavin Newsom, regulators, and local officials to keep it operational have ultimately failed.

In recent years, several refineries in California have either closed or converted to producing biofuels, leading to a progressively shrinking fuel supply within the state. Consequently, local drivers often face gasoline prices that rank among the highest in the nation. Last week, Governor Newsom commended Valero's plan to continue supplying gasoline to the state during the shutdown process, describing the decision to import fuel to the region as a constructive development compared to the previous possibility of a complete market exit.