Posted on 12/16/2025 11:05:57 AM PST by MtnClimber
Before handing Gavin Newsom the Democratic presidential nomination in 2028, Democrats may want to pause and consider his long record of failure in California. From his mishandling of the January wildfires to his coddling of illegal immigrants, his poor governance has led to a collapse of public confidence and a mass exodus from the Golden State.
But buried beneath the broader criticism is an often overlooked central failure: Newsom’s policy decisions have made California an increasingly hostile state in which to conduct business. And few industries have suffered more under California’s regulatory assault than fossil fuels, where relentless overreach has driven companies out of the state. The latest major corporation to join the stampede is Valero Energy. The company is so determined to flee California’s overregulation that it was willing to absorb a staggering $1.1 billion loss to get out. Valero will shutter operations by April 2026.
Because other energy companies have already left California, Valero’s exit will put even greater upward pressure on gasoline prices in the state, which are already among the highest in the nation.
The video below from widely followed X account @WallStreetApes explains the current situation:
Valero just wrote off $1.1 billion. That is the cost they are taking to walk away from California rather than keep operating their Benicia refinery past April 2026.
When a company takes a billion dollar loss just to leave, you know something is seriously broken.
This facility processes 145,000 barrels of oil per day, representing 8.6% of California’s entire gasoline production. 400 workers have lost their jobs. 200 contractors are out of work.
The city of Benicia loses 17% of its entire budget, and California drivers, they are about to get hammered with the worst gas prices in American history.
University of California Davis economists calculate a 40 cents per gallon increase the moment Phillips 66 closes their Los Angeles refinery this December. Then another 81 cents when Valero shuts down four months later in April. That totals a $1.21 per gallon increase by August 2026, your 15 gallon fill-up jumps from $70 to at least $95.
The Stanford Energy Institute came up with even worse projections. They are showing potential spikes to $8 per gallon during supply disruptions.
UC Berkeley’s Severin Borenstein, who has been tracking California energy markets for decades, warns these closures could create severe gasoline shortages with unprecedented price increases.
There is an added wrinkle — a major one. In an attempt to reduce air pollution and greenhouse gas emissions, the state has mandated the use of special blends of gasoline, which are known as “CARBOBs — California reformulated gasoline blend stock for oxygenate blending. This is not regular gasoline. It is a specialized ultra clean burning fuel mandated by California law.”
These blends cost substantially more to produce than regular gasoline due to their added complexity.
Unlike other states, California’s special fuel blends cannot be imported from major U.S. oil-producing states such as Texas, Oklahoma, or Louisiana when inventory runs low. Instead, supply comes largely from a shrinking number of in-state refineries or from a handful of foreign refineries — primarily in countries like South Korea, India, and Singapore — that have the specialized equipment needed to produce CARBOB fuel.
The long-distance transport, exposure to global supply-chain disruptions, and added logistical costs all drive prices higher — costs that are first borne by corporations and ultimately passed on to California consumers at the pump.
Valero is taking a $1 billion dollar loss just to get out of California by April 2026
The company will not comply with Gavin Newsom mandates and instead is willing to lose a billion dollars to leave
“When a company takes a billion dollar loss just to leave, you know something… pic.twitter.com/9xpPBWd4fu
— Wall Street Apes (@WallStreetApes) December 14, 2025
Leslie Eastman has reported frequently on the flight of energy companies out of California over the past couple of years. She covered Chevron’s departure here and here — as well as Valero’s initial announcement of its decision to shutter its Benicia refinery.
Leslie also wrote about Newsom’s approval of an order to force energy producers to stock pile gasoline, a measure that led Phillips 66 to announce it would end “operations at its Los Angeles-area refinery in the fourth quarter of 2025.”
Needless and ill-considered policies like this are driving energy companies out of California, one regulation at a time.
But the exodus has not been limited to energy companies. Below is a list of other corporations that have left to escape California’s unfriendly business climate in recent years.
We can now add Valero to the growing list of major companies fleeing California, taking well over $1.3 trillion of revenue with them. Great job Newsom!
• AECOM
• Align Technology, Inc.
• Amazing Magnets, LLC
• Amgen Inc.
• Anduril
• Bed Bath & Beyond
• Blaze Pizza…
— BlackApple (@BlackApple) December 14, 2025
These corporate departures are not abstract losses — they are steadily hollowing out California’s tax base. In a state where the top 1 percent of taxpayers generate nearly half of all income tax revenue, the flight of high earners and major employers carries severe fiscal consequences.
Those consequences are now impossible to ignore. Just last month, CalMatters projected an $18 billion deficit for the 2026–27 fiscal year, the fourth major shortfall in as many years. The nonpartisan Legislative Analyst’s Office has warned that California faces “potential structural deficits of $15 billion to $35 billion annually through 2028–29,” a sign not of temporary turbulence, but of deep and persistent mismanagement.
This is the legacy of Gavin Newsom’s governance: a state hemorrhaging businesses, eroding its revenue base, and lurching from one budget crisis to the next. California was once an engine of growth and opportunity. Under Newsom, it has become a cautionary tale.
If this is the model of leadership Democrats intend to export to the nation, voters should ask a simple question: why would anyone entrust the presidency to the man who helped drive the country’s largest state into fiscal and economic decline?
Thanks, AutoPen Sniffy Pantz Shizzer!
And steep gas price increases will cause manufacturers who depend on ground transportation to ship its products to leave. There will be a big ripple effect.
I’ve said it elsewhere on FR, but I’ll say it again. It is nearly three years before Election Day. Unless the front runner is the incumbent president, whoever is called the front runner this early ALWAYS loses. Just wait, there are plenty of opportunities for the candidate in the spotlight to derail his campaign with a slip of the tongue. Does anyone remember what George Romney (Mitt Romney’s dad) and Ed Muskie did when they were in the lead?
Sadly, like the Soviet Union, a one-party leftist government can not reform itself, until it collapses.
Rob Reiner says he’s fine with this...oh wait.
Bad decisions have consequences. When you follow the lead of leftists it is a BAD DECISION.
“..Can you imagine what damage Newsom would do as Present?....”
Definitely, a scary thought. Would it be any worse than if “Heels-up, Knees-wide were running the country? It would be proabably be a lot worse!!
Grusome NewScum would likely have his greasy, fat, gimme-dat ghettopotomai along with his AWFULs running that auto pen 24/7/365.
Churches would be outlawed along with guns, we’d be either be speaking Mandrin Chinese and/or bowing to allah just to stay alive.
Within a year, he’d have us back to living in the first century; dressed in loin clothes, living in mud huts while he and his vile, filthy ilk live like kings....spit.
It would the ultimate downfall of America...no doubt about it.
Newsome could teach a master class on how to destroy a state.
Free Candy can be extremly expensive.
This is what Newsom wants. His plan is for California to take over the refineries — to seize the means of production....”
Those oil companies learned a lot from that nationalization that took place in Venisualia. They ought to go completely ‘scorched earth’ on these vile basstids leaving NOTHING behind that can be sold and/or operated...
Chicks love Communism. Beats getting married.
Newsom could teach Cloward and Piven some new tricks.
Not something.
The public sector.
Not too long ago the Ohio legislature and Gov Celeste was trying to stem the outflow of businesses to the cheaper (often non-union) states in the South. So they passed a bill saying that any company that closed its operation in Ohio would have to pay an “exit tax” equal to six months wages of the company. The sales point was that those funds would help pay unemployment benefits and retraining costs. Several months later the legislators did a forehead slap after noting there were no new businesses forming in Ohio. In their favor, they quickly dropped the tax.
Too bad the people of CA aren’t able (smart enough?) to drop Newsom as quickly. They had their chance, but put him back in office, so it’s hard to feel sorry for them.
“This is what Newsom wants. His plan is for California to take over the refineries”
You kinda caught me off guard there. It’s the obvious answer sitting right there under our noses. I think you might be onto something here.
Yes, until the walking around money runs out.
So, the Christian conservative republicans like myself and my family, who never vote for any democrats, deserve to suffer under the iron boot of democrats who've stolen elections and put us under one party rule?
Consider you just posted that nasty rotten opinion to a California based conservative forum. People like you don't seem to understand there are millions of conservatives here that never vote for democrats or any of their terrible, self serving schemes. This could happen to you in your state too, in fact, it's exactly what the democrats have planned for you.
Dyslexic, adulterous bastard who slept with his chief right hand man’s wife, never forget that.
the corrupt politicians have so destroyed the once-Golden State, it is tragic.
still some very nice scenery but that’s about it.
AND, THAT IS WHY HE MUST NOT BE ELECTED POTUS!
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