Phillips 66 Says Decision to Close Wilmington Refinery Part of Long-Term Analysis

Phillips 66’s decision to close its Wilmington Refinery, also known as its Los Angeles Refinery, in the fourth quarter of 2025 came after a long-term analysis and not in reaction to policy changes. “The uncertainty of the long-term sustainability of the refinery and market dynamics were key factors in this decision,” said CEO Mark Lashier on the company’s October 29 earnings call.

Lashier said the decision was part of an ongoing evaluation of all of the company’s assets. He noted that the Los Angeles refinery, which opened in 1917, was originally designed to process in-state California crude production, which has declined by about 75%. “[T]he continued outlook in California in the face of declining diesel and gasoline demand was a pretty tough one,” he said.

California crude oil is more costly to refine than oil from other states or foreign countries, as it is generally heavier with a higher sulphur content.

Lashier also cited “California’s stated policy to move away from fossil fuels” in the company’s expectations of a challenging refining market in the state. He also noted “the typical maintenance and regulatory spending that we face, and that's only going up.”

He noted that “an exhaustive review of all the alternatives” led the company to close the refinery. “[I]t wasn't any knee jerk reaction in the face of any policy changes in California. This has been a long-term analysis,” he said.

The Phillips 66 Los Angeles Refinery has a capacity of 139,000 barrels of oil per day, according to the California Energy Commission, accounting for about 8% of California’s refining capacity.