Trump Orders Restart of Oil Drilling Along California Coast Amid Iran War

On Friday, March 13, the Trump administration took an extraordinary step: invoking the Defense Production Act of 1950 — a Korean War-era statute designed to mobilize American industry for national defense — to order the restart of offshore oil platforms and a pipeline system along California's Santa Barbara coast that has been shuttered since a catastrophic spill eleven years ago [1].

The order, issued by the Department of Energy, directs Houston-based Sable Offshore Corp. to restore production at the Santa Ynez Unit, a cluster of offshore platforms capable of producing up to 50,000 barrels of oil equivalent per day [2]. The administration's justification: a global energy crisis triggered by the ongoing U.S.-Iran war and Iran's closure of the Strait of Hormuz, which has caused the largest supply disruption in the history of the global oil market [3].

But critics — from California's governor to environmental attorneys to legal scholars — say the move is an unprecedented abuse of emergency powers, one that tramples state sovereignty, defies court orders, and risks another devastating coastal oil spill, all for what Governor Gavin Newsom has dismissed as "a drop in the bucket" in global oil production [4].

The Energy Crisis Behind the Order

The context for Trump's order is a global energy emergency without modern precedent. Iran's closure of the Strait of Hormuz — through which roughly 20% of the world's daily oil supply normally transits — has choked off millions of barrels per day from reaching markets [5]. The International Energy Agency has estimated that global oil supply has plunged by 8 million barrels a day, describing the disruption as the largest in history [3].

Source: FRED / U.S. Energy Information Administration

Data as of Mar 11, 2026CSV

The impact on American consumers has been swift and severe. Nationally, gasoline prices have surged to approximately $3.58 per gallon on average. But in California — where a unique blend mandate, limited refinery capacity, and lack of pipeline access to other U.S. supply regions create structural vulnerabilities — the pain has been far worse. The statewide average hit $5.42 per gallon on March 14, an increase of 80 cents in a single month [6]. Some regions are seeing prices well above $6.

In response, the administration has unleashed a multi-pronged strategy to boost supply. The U.S. will release 172 million barrels from the Strategic Petroleum Reserve, according to Energy Secretary Chris Wright [7]. The International Energy Agency has coordinated a historic international release of 400 million barrels from member nations' reserves — the largest coordinated drawdown ever [8]. And now, the administration is reaching for the Defense Production Act to unlock domestic production that has been blocked by state regulators and the courts.

"Today's order will strengthen America's oil supply and restore a pipeline system vital to our national security and defense, ensuring that West Coast military installations have the reliable energy critical to military readiness," Wright said in a statement announcing the order [1].

The Ghost of Refugio Beach

The pipeline and platforms at the center of this battle have a dark history. On May 19, 2015, a corroded section of the underground Line 901 pipeline — then owned by Plains All American Pipeline — ruptured along the Gaviota Coast north of Goleta, releasing approximately 450,000 gallons of crude oil [9]. The spill contaminated 150 miles of California coastline, killed hundreds of birds and marine mammals, shut down beaches and fisheries, and became one of the worst coastal environmental disasters in the state's history [10].

The cleanup cost an estimated $96 million, with total expenses including legal claims reaching roughly $257 million [9]. The entire Santa Ynez Unit — three offshore platforms and two onshore pipelines — was shut down indefinitely. A 2020 federal consent decree required approval from the California State Fire Marshal before the pipeline could restart.

Then, in 2024, a little-known Houston-based company called Sable Offshore Corp. purchased the entire system from ExxonMobil for $643 million — largely financed by a $622 million loan from Exxon itself [11]. Sable told investors it could bring production back to 50,000 barrels per day, and its stock became a speculative play on whether the company could navigate California's regulatory maze.

It couldn't — at least not through normal channels.

A Record of "Systemic Non-Compliance"

What followed Sable's acquisition was a series of regulatory clashes that painted a picture of a company unwilling to follow the rules. A staff report found that "Sable has amassed a significant track record of systemic non-compliance," demonstrating "a lack of diligence and a pattern of failing to notify regulatory agencies" of proposed work [12].

The California Coastal Commission fined Sable a record $18 million for defying state orders to stop work on the pipeline [13]. The company was found to have conducted unauthorized excavation, grading, pipeline repairs, and offshore sandbag placement without Coastal Act authorization, despite receiving formal cease-and-desist orders.

The problems went deeper. The Santa Barbara County District Attorney filed criminal charges against Sable, including five felony counts for knowingly discharging pollutants into local waterways between October 2024 and April 2025, along with 16 misdemeanor charges related to obstructing streambeds and mishandling hazardous materials [12]. Santa Barbara County supervisors denied a permit transfer to Sable, citing both operator competence and financial concerns [11].

Perhaps most troublingly, Sable had not posted the $350 million decommissioning bond required by ExxonMobil, nor the $31.9 million bond mandated by California's Geologic Energy Management Division [11]. Investigative reporting by Hunterbrook Media found the company was "burning cash rapidly" and "faced major liabilities" while still needing billions to reach full commercial production [14].

In February 2026, a Santa Barbara County Superior Court judge ordered the pipeline to remain closed, ruling that the Trump administration's intervention was insufficient to override state approval requirements [15]. The 9th U.S. Circuit Court of Appeals is still weighing the federal Pipeline and Hazardous Materials Safety Administration's emergency permit, issued in December.

The Defense Production Act Gambit

Blocked at every turn in the courts and by California regulators, Sable found a powerful ally in the Trump administration — and the Iran war provided the opening.

On March 3, the Department of Justice issued a legal opinion concluding that a presidential order under the Defense Production Act could preempt California state law under the Constitution's Supremacy Clause [16]. The memorandum outlined two mechanisms: explicit displacement of conflicting state requirements, and conflict preemption where state restrictions obstruct federal policy objectives. Critically, the DOJ concluded the DPA could also override the 2020 federal consent decree requiring State Fire Marshal approval.

Ten days later, the White House issued an executive order expanding the Energy Secretary's DPA authority, and the Department of Energy issued the directive to Sable to resume operations [1].

Legal experts have described the move as "incredibly novel." While the DPA has been invoked many times — most recently during COVID-19 for medical equipment production — using it to preempt state environmental and safety laws for a single private company's oil drilling operations appears to have no direct precedent [16]. The closest analogy, a 1957 Eighth Circuit case involving federal loan conditions superseding state lien laws, involved far narrower circumstances.

Source: GDELT Project

Data as of Mar 14, 2026CSV

California Fights Back

Governor Newsom's response was immediate and scathing. "The Trump Department of Justice opinion on his emergency power is as lawless as his emergency tariffs that the Supreme Court just struck down," Newsom said. "If Trump thinks he can override California law and an existing court order with the stroke of his pen, we look forward to hearing what the federal court he's defying has to say" [4].

Newsom has characterized the move as "another step on the slippery slope toward authoritarianism" and emphasized that the Sable pipeline would contribute only 0.05 percent to U.S. crude oil production — negligible relief for gas prices that are being driven by a multi-million-barrel-per-day global supply shock [4].

Attorney General Rob Bonta's office said the state is "reviewing this development" and preparing legal action [1]. Environmental organizations including the Center for Biological Diversity, Environmental Defense Center, Sierra Club, and Santa Barbara Channelkeeper already have active litigation challenging the pipeline restart.

"This is a revolting power grab by an extremist president," said Talia Nimmer, an attorney with the Center for Biological Diversity. "Trump is misusing this Cold War-era law just to help a Texas oil company skirt vital state laws that protect our coastline. Directing a private oil company to push its project through without safety checks and adherence to California laws that keep our coast safe is appalling and illegal" [10].

The coalition of environmental groups has warned that forcing the pipelines to restart would not meaningfully lower gasoline prices but would expose coastal wildlife and communities to the risk of another catastrophic spill. A Center for Biological Diversity analysis found that the broader Trump offshore drilling proposal could result in more than 4,000 oil spills in U.S. waters [10].

The Market Response

Wall Street, for its part, has been paying close attention. Sable Offshore's stock (NYSE: SOC) surged more than 20% on Wednesday when Bloomberg first reported the administration's plans, reaching a five-month high [14]. The stock has been on a roller coaster — spiking on favorable federal developments and plunging on court setbacks. Institutional ownership stands at nearly 89%, and analysts have set a price target of around $24.40, suggesting significant upside if the restart proceeds [14].

But the financial picture for Sable itself remains precarious. The company faces criminal charges, massive bonding requirements it has not met, billions in projected costs to reach full production, and the very real possibility that the courts will block the restart regardless of the DPA order. The legal battle is expected to move through the federal courts rapidly, with some observers predicting it could reach the Supreme Court — testing the boundaries of presidential emergency powers in a case with enormous implications for federalism and environmental law.

The Bigger Picture

The California drilling order is not happening in isolation. It is one piece of a sweeping administration response to the Iran war energy crisis — a response that also includes the largest-ever strategic reserve release, diplomatic pressure on OPEC+ nations to boost production, and executive actions to accelerate permitting for energy projects across the country.

But it is also emblematic of a deeper tension in American energy policy: the collision between the imperative for energy security in a time of war and the environmental, legal, and democratic norms that govern how and where energy is produced. The administration argues that national security demands override state-level objections. Critics argue that the emergency is being exploited to advance a pre-existing agenda — noting that the Trump administration and Sable have been working to circumvent California regulators since long before the first bomb fell on Iran.

The West Coast governors of California, Oregon, and Washington issued a joint statement in January opposing expanded offshore drilling, calling it a threat to coastal economies, fisheries, and ecosystems [4]. Environmental advocates point out that the 2015 Refugio spill — from the very same pipeline system — demonstrated exactly the kind of catastrophe that state regulations are designed to prevent.

As the case moves toward the courts, the outcome will set precedents far beyond one pipeline in Santa Barbara County. It will determine whether a president can use wartime emergency powers to override state environmental laws, bypass court orders, and direct a private company with a documented record of regulatory violations to resume operations that state authorities have deemed unsafe. The answer will shape the balance between federal power and state sovereignty for years to come.