{"id":38793,"date":"2026-03-27T14:21:20","date_gmt":"2026-03-27T14:21:20","guid":{"rendered":"https:\/\/www.europesays.com\/iran\/38793\/"},"modified":"2026-03-27T14:21:20","modified_gmt":"2026-03-27T14:21:20","slug":"californias-fossil-fuel-phaseout-has-left-it-vulnerable-to-the-iran-oil-shock","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/iran\/38793\/","title":{"rendered":"California\u2019s fossil fuel phaseout has left it vulnerable to the Iran oil shock"},"content":{"rendered":"

California has managed a remarkable feat over the past twenty years. Even as its economy has grown to overtake Germany\u2019s as the fourth-largest in the world<\/a>, the state\u2019s consumption of gasoline<\/a> has declined<\/a> by almost 15 percent<\/a>, and consumption of petroleum diesel<\/a> has fallen by around two-thirds. This has happened due to some of the world\u2019s most aggressive climate policies, including a tax on carbon emissions and a strict requirement to adopt clean-burning fuels such as \u201crenewable diesel<\/a>\u201d made from fats and oils.<\/p>\n

During the same period, California\u2019s production of crude oil has also fallen by around half, and many oil wells have shut down. The state now imports almost two-thirds<\/a> of its crude oil from tanker ships, which is cheaper and more practical because it is separated by steep mountains from oil-producing zones such as Texas. Some of the state\u2019s largest gasoline and diesel refineries are also shutting down amid declining demand, which will make the state dependent on imports of refined gasoline, too.<\/p>\n

The state\u2019s diminished fossil-fuel sector has made it especially vulnerable to the oil shock of the Israeli-U.S. war with Iran \u2014 and to interventions from the Trump administration that could delay or even reverse California\u2019s trend toward renewable energy. Gas prices in the state have spiked toward $7 a gallon<\/a> in recent weeks, the highest prices in the country. As other economies clamp down on fuel exports, it\u2019s possible the state could face even higher crude prices or a shortage of gasoline.<\/p>\n

Two weeks after the war began, President Donald Trump\u2019s Justice Department issued a legal memorandum<\/a> arguing that the federal government can use the Defense Production Act to preempt state law in the event of energy emergencies. The Department of Energy then moved to restart a long-defunct California offshore oil pipeline owned by the company Sable Offshore. The order from energy secretary Chris Wright cited \u201cCalifornia\u2019s reliance on foreign oil vulnerable to geopolitical disruption,\u201d with \u201ca significant share traveling through the Strait of Hormuz.\u201d The pipeline has been shut down<\/a> since a 2015 oil spill that killed hundreds of animals, and state officials had not given it clearance to reopen. On the very next day, the pipeline reopened. California has sued<\/a> to shut it back down.<\/p>\n

For now, the Sable pipeline is ramping up to process around 50,000 barrels a day, which would provide around 3 percent of the state\u2019s daily oil needs. Chevron has already said it will buy and refine 20,000 barrels of crude<\/a> from the pipeline starting in April. The addition of new supply from Sable could lower costs for refineries, said Mike Umbro, an energy entrepreneur who runs Californians for Energy and Science, an educational nonprofit that advocates for increased oil production. Beyond Sable, though, there aren\u2019t many good options for increasing crude supplies in the short term. <\/p>\n

\u201cSacramento\u2019s saying, \u2018You don\u2019t have a long term future here,\u2019 so the companies aren\u2019t going to dump a bunch of money in to increase production,\u201d Umbro said.<\/p>\n

Nevertheless, the Interior Department said this week it would consider a proposal<\/a> from another offshore oil company to frack undersea oil wells in order to increase production. The administration has also held oil lease sales on federal land<\/a> in California, and has sued to block a state law<\/a> that would limit drilling near homes and schools, both measures that would open up more onshore oil production in the state.<\/p>\n

Read Next<\/p>\n

<\/p>\n

\"Amir<\/p>\n

<\/a><\/p>\n

Iran was already running out of water. Then came the \u2018war on infrastructure.\u2019<\/a><\/p>\n

But more upstream oil production won\u2019t help resolve the current fuel crunch. Even as some oil producers consider pumping more crude, no one has suggested building more refineries. In fact, Chevron and other large refinery owners have warned that California\u2019s \u201ccap-and-invest\u201d program \u2014 a carbon tax that gets more expensive as time goes on \u2014 could soon drive them out of the state. The California Air Resources Board, the state\u2019s climate regulator, is supposed to debut new rules for the carbon tax later this year, which would reduce the amount of free emissions refineries would be allowed to emit and make refineries less likely to stay in California.\u00a0<\/p>\n

The oil industry\u2019s argument against these regulations follows the same logic as the Trump administration\u2019s. \u201cContinued erosion of California\u2019s refining capacity risks increased reliance on imported fuels that are slower to arrive, more exposed to global supply disruptions, and less reliable during emergencies or periods of heightened geopolitical risk,\u201d Andy Walz, a senior executive at Chevron, wrote in a letter to state leaders.<\/p>\n

At the CERAWeek energy conference this week in Texas, Walz said he believes the state could soon have a shortage of gasoline and jet fuel, and that Chevron might close its own refineries within a decade. Those refineries account for 30 percent of capacity, and losing them could cause huge supply shortages for Bay Area drivers, Central Valley farmers, and even Air Force bases<\/a>.<\/p>\n

Democrats and environmental groups in the state, meanwhile, say that the refiners may be crying wolf about the state\u2019s carbon tax. They see the Iran crisis as more evidence that the state should lean harder into its transition away from oil. Indeed, as Katelyn Roedner Sutter, the California state director for the Environmental Defense Fund, sees it, the current gas spike may only speed up the state\u2019s energy transition by making electric vehicles even more attractive. Governor Gavin Newsom\u2019s latest budget proposed a subsidy for first-time EV buyers, designed to replace the repealed Inflation Reduction Act tax credits, and she said the Iran crisis could strengthen the governor\u2019s case.<\/p>\n

\u201cI do think the war actually makes it even more important to move forward with this, because I think it just underscores how vulnerable we are, being so dependent on fossil fuels,\u201d she said.<\/p>\n","protected":false},"excerpt":{"rendered":"California has managed a remarkable feat over the past twenty years. Even as its economy has grown to…\n","protected":false},"author":2,"featured_media":38794,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[154,34,7959,81,4079],"class_list":{"0":"post-38793","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-iran","8":"tag-energy","9":"tag-iran","10":"tag-news-analysis","11":"tag-politics","12":"tag-yahoo"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@iran\/116301587001512500","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/posts\/38793","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/comments?post=38793"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/posts\/38793\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/media\/38794"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/media?parent=38793"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/categories?post=38793"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/tags?post=38793"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}