California agencies warn refinery exits could increase price volatility as they weigh emergency tools

Chair Petrie‑Norris opened the hearing by calling California’s fuels transition “one of the most complicated and I believe important challenges that policy makers will need to face in the decade ahead,” and said the recent Phillips 66 (Wilmington) and Valero (Benicia) announcements mark “a pivotal moment” for state supply and prices.

Agency witnesses described three linked risks: falling local refining capacity, continued demand for liquid fuels during the multi‑decade transition, and concentrated market structure that can amplify price moves. Liane Randolph, chair of the California Air Resources Board, told the committee that "fossil fuel use in vehicles is the single biggest source of climate and air pollution in the state," and said CARB’s programs (including the Low Carbon Fuel Standard, or LCFS) remain central to meeting state air‑quality and climate goals.

Ty Mylder, director of the Division of Petroleum Market Oversight (DPMO), summarized DPMO’s new findings on retail prices and margins: “Californians have been paying 41¢ per gallon extra for every gallon of gasoline sold since 2015,” a difference DPMO calls the "mystery gasoline surcharge" and that the division estimates amounts to roughly $57 billion cumulative since 2015. DPMO staff told the committee that branded retail outlets account for much of that difference (branded outlets…