California chose ‘sustainability’ over gas

The last oil tanker carrying crude from the Persian Gulf (Iraq) is unloading in Long Beach, California. This effectively marks the end of Middle East oil imports to the state, at least for now.

We need to replace roughly 200,000 barrels per day.

We are not running dry — not yet.

California has petroleum stockpiles and can pivot to other sources like Brazil, Ecuador, Guyana, Canada, and increased U.S. domestic crude.

Yet the scramble itself exposes a deeper rot: state-level decisions have made California uniquely vulnerable to supply shocks like the current Middle East disruptions.

Geography does not help. California is an “energy island,” with very limited pipelines from other U.S. regions, forcing tanker imports, typically going through the Panama Canal.

The Trump administration has tried to help. The president suspended Jones Act requirements, temporarily allowing non-U.S.-flagged tankers to handle port-to-port shipments, from East Coast and Gulf refineries to California, easing the immediate crunch. (Democrats opposed the move, clinging to the century-old law’s job protectionism even as Californians faced spiking gas prices.)

But California’s energy supply is in trouble. And that is because of long-term policy choices our state has made to restrict the local oil and gas industry.

Several state administrations contributed to the problem, but the heaviest regulation occurred under Governor Gavin Newsom.

In-state oil production has plummeted from peaks in the 1980s, when California pumped hundreds of millions of barrels annually, to much lower levels today. The state now imports 60-75% of its crude.

Refining capacity is also shrinking, with major closures like Phillips 66’s LA refinery (2025) and Valero’s Benicia (2026) reducing capacity by about 17%. Bureaucrats watched these capacity numbers slide for decades, yet their response was to double down on restrictions rather than to build resilience.

Because nothing says “forward thinking” like watching your refineries disappear while lecturing everyone else about sustainability.

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Drilling and permitting restrictions tell the story best. Under Newsom, there has been a dramatic drop in new oil well permits (from thousands per year to less than 100 in some recent years).

Moratoriums, environmental reviews, and phase-out efforts have accelerated the industry’s decline.

Newsom, fearing gas price spikes, signed SB 237 in 2025 to boost permits in Kern County, partially reversing his earlier policy. Better late than never, unless you’re a driver staring at today’s $6-plus gasoline and wondering why foresight was optional.

Refinery challenges piled on. Strict environmental rules; the unique California gasoline blend (CARBOB – costly to produce); the Low Carbon Fuel Standard (LCFS); the cap-and-trade system (now “Cap-and-Invest”), emissions targets, and refinery-specific regulations all raised operating costs.

Price-gouging laws and efforts to impose profit caps contributed to closures by creating uncertainty and reducing profitability. Refiners have cited these as key reasons for exiting.

The bureaucrats who wrote those rules now issue endless press releases about “working with industry” on alternatives, as if the exodus they engineered was someone else’s fault.

The broader green energy agenda sealed the vulnerability. An aggressive push for carbon neutrality (2045 goal), electric vehicle mandates, and fossil fuel phase-outs prioritized long-term climate goals over short-term energy security.

It is true that demand for gasoline and diesel is declining due to the efficiency of newer engines, the wider adoption of EVs, and the state’s push for renewables push. But demand has not dropped quickly enough to offset the supply shocks that are raising prices now.

The agencies knew California sat on an energy island. They knew import dependence was climbing. They knew geopolitics could snarl the Strait of Hormuz or the Panama Canal route.

Yet the regulatory machine kept grinding forward, treating domestic crude like an embarrassing relic rather than a hedge against threats to California’s energy-hungry economy.

Bipartisan warnings from lawmakers, including Democrats, fell on deaf ears.

California Energy Commission’s (CEC) reports were overdue. Emergency planning was an afterthought.

The same officials who lecture the public about “climate resilience” somehow missed the more immediate problem: keeping the lights on, and keeping and cars moving when foreign tankers vanish.

California’s leaders chose a rapid transition away from fossil fuels, accepting (or underestimating) the risks of higher costs, import reliance, and fragility to shocks.

Other states with oil resources have managed a much better, and more resilient, approach.

Who’s to blame? It isn’t one person or agency. It’s a cumulative policy direction prioritizing emissions reductions over resilient domestic supply.

The ideologues and bureaucrats will no doubt insist that California was merely following “science” and state law.

The rest of us are left calculating how many more tanks we can fill before we run out of money, or the pump runs dry.

Richie Greenberg is a political commentator based in San Francisco.