California’s effort to cut oil use while phasing out fossil fuels is raising alarms in Nevada that refinery closures could push up fuel prices, particularly in the Las Vegas area where transportation fuel supply is tightly linked to pipelines and refining capacity in the West.
The AP reported that California supplies roughly 88% of Nevada’s fuel, including diesel and jet fuel. That dependence centers on California refiners and fuel transported through major pipelines into Nevada, leaving state officials and industry experts focused on what happens when California’s refining base shrinks. Recent shuttering and planned shutdowns are at the center of those concerns: Phillips 66 closed a refinery in the Los Angeles area in October, and Valero filed notice that it plans to close a Bay Area refinery by April 2026.
The combined effect of the Phillips 66 and Valero facilities is described as 284,000 barrels of oil per day—about 17% of California’s refining capacity. The closures come as California seeks net-zero carbon emissions by 2045, including by cutting oil use, a transition that also includes policy changes aimed at shifting transportation away from gasoline.
Paul Enos, CEO of the Nevada Trucking Association, said in comments carried by The Nevada Independent that restricting the supply of fuel coming out of California would increase costs in Nevada, saying, “If you limit the supply of fuel coming out of California, you’re going to see that cost increase.” He added that the policies in California affect “every citizen of Nevada.”
Economists and energy analysts also connected the question of supply reductions to the behavior of prices and the risk of shortages. Elliott Parker, a professor and economics chair at the University of Nevada, Reno, said that if there is less supply, “You’ve got to get people to drive less,” and that “comes with a cost.” Parker also argued that “if you don’t let the prices go up, then you will have shortages.”
Nevada Gov. Joe Lombardo has repeatedly raised concerns about fuel insecurity as a safety issue, particularly if shortages disrupt transportation hubs or first responder operations. Lombardo and the Nevada Commission on Homeland Security recently created a fuel resiliency subcommittee, which he said is designed to “develop long-term strategies that strengthen our infrastructure, diversify supply routes, and protect Nevada’s future.”
Officials said the subcommittee will look at options that include expanding infrastructure and storage, recommending emergency response policies, and coordinating with other agencies to accelerate permitting for critical infrastructure projects. Its first meeting is expected this month, and Lombardo’s office said the work is intended to address homeland security threats if fuel supplies to first responders and key transportation operations are compromised. Chase McNamara, the governor’s policy adviser on natural resources, told The Nevada Independent that, “Energy security touches every part of daily life, and waiting until fuel disruptions are visible to the public is already too late.”
The concerns are sharpened by Nevada’s fuel transport network. The AP said almost all of the gas, diesel and jet fuel consumed in the Las Vegas Valley is transported via the CalNev pipeline, which runs from Los Angeles to Las Vegas. Another gas line runs from the Bay Area to Reno, and a third runs from Salt Lake City to Las Vegas. Over the past several years, wildfire disruptions have repeatedly interrupted those routes: the Bay Area-to-Reno line was shut down in 2019 as wildfires burned in California, and Lombardo declared a state of emergency in 2023 when the Las Vegas-to-Los Angeles pipeline—used by Nellis and Edwards Air Force bases and McCarran International Airport—was temporarily shut down. The CalNev pipeline was again temporarily shut off earlier this year because of wildfires.
As a result of that reliance on out-of-state supply, some experts described the current situation as vulnerable for consumers. Michael Mische, a University of Southern California associate professor and industry expert, said Nevada is “in a very vulnerable situation.” Miranda Hoover, the state executive for the Energy and Convenience Association of Nevada, said Nevadans are likely to start feeling pain at the pump by next summer, warning: “It’s very scary for consumers, businesses (and) families working on a tight budget.”
Industry expansion plans are also part of the debate about how quickly Nevada can offset any supply pressure. The AP reported that Sinclair Gas has announced it is evaluating a multiphased expansion across Western fuel markets—particularly in Nevada and California—that could supply as many as 150,000 barrels per day. The first phase is described as “debottlenecking” Sinclair’s pipeline from Salt Lake City to Las Vegas and moving a projected 35,000 barrels per day from the Rockies into Nevada, with a target operational date of 2028. Sinclair has also floated the idea of a new lateral pipeline from Salt Lake City to Reno and a pipeline expansion between Texas and Phoenix that could benefit Nevada, Hoover said.
While Nevada can draw some fuel from Utah, the AP said state officials do not expect Nevada oil production to rise to offset lost refining supply. The story said Nevada lacks substantial crude oil reserves and that production has declined over decades, reaching more than 4 million barrels in 1990 before falling to around 170,000 barrels last year. With those limitations, Parker questioned whether Nevada has enough market leverage to influence what happens outside the state, saying with about one-tenth the population of California, “I don’t think there’s much Nevada can do,” and adding, “We’re a small part of the market.” Parker said the bigger question is what California wants to do as it pursues reduced oil use.
The AP reported that, beyond refinery closures and pipeline disruptions, California has also passed legislation aimed at reshaping the energy market, including creating an independent watchdog to monitor oil companies for price gouging, passing an electric vehicle mandate for new gasoline-powered vehicles that has been blocked by the Republican-led U.S. Senate, and authorizing state energy regulators to require refineries to maintain a minimum fuel inventory. For Nevada, the near-term challenge is whether supply changes driven by that transition arrive faster than transportation fuel infrastructure and storage can be diversified.