President Trump signed an executive order on Friday giving the Department of Energy authority to invoke the Defense Production Act, a 1950 Cold War-era law, to force the restart of a dormant offshore oil operation along the California coast, setting up a major legal and political confrontation with Gov. Gavin Newsom.
Energy Secretary Chris Wright acted the same day, directing Sable Offshore Corp., a Houston-based company, to restore operations at the Santa Ynez Unit and Santa Ynez Pipeline System off Santa Barbara County—infrastructure that has been offline since a pipeline rupture in 2015.
“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.
The timing is directly tied to the ongoing conflict with Iran. The war, roughly two to three weeks old, has disrupted roughly 20 million barrels of oil per day that previously transited the Strait of Hormuz before Iranian officials threatened to close the narrow waterway entirely. The disruption has sent crude to roughly $100 a barrel and pushed California gas prices past $5.40 a gallon, according to the American Automobile Association (AAA).
The Energy Department made the national security case plainly: more than 60 percent of oil refined in California arrives from overseas, with a significant share traveling through the Strait of Hormuz. With military installations along the West Coast increasingly reliant on those supply chains, the administration argues the situation meets the threshold for Defense Production Act intervention.
It’s worth noting that planning for this action appears to have begun before the Iran conflict escalated. The Justice Department’s Office of Legal Counsel issued a 22-page opinion earlier this month concluding that a presidential order under the Defense Production Act would preempt California state laws blocking Sable’s restart. This opinion made no mention of Iran.
The Santa Ynez Unit includes three offshore platforms in federal waters, an onshore processing facility, and a network of pipelines stretching along the Santa Barbara County coast. ExxonMobil operated the offshore unit until a Plains All American-operated onshore pipeline ruptured in May 2015, spilling 142,000 gallons of crude oil at Refugio State Beach, according to state figures (21,000 of which reached the Pacific Ocean) in one of the largest coastal oil spills in California’s history. The spill shut down the entire system.
Sable Offshore purchased the entire system from ExxonMobil in 2024, securing a $622 million loan from ExxonMobil to fund the deal. The company says it has repaired the pipeline and insists the infrastructure has “massive resource potential” that could significantly offset California’s dependence on imported oil. Sable told investors a restart could push production from roughly 30,000 barrels of oil equivalent per day to more than 50,000.
The problem: California hasn’t let them flip the switch. State agencies, including the Coastal Commission and State Parks, have withheld required approvals. The State Fire Marshal initially issued Sable a restart waiver, then reversed course, finding in October 2025 that additional repairs were still needed. A Santa Barbara County Superior Court judge ruled as recently as last month that Sable still needed to comply with state requirements before any restart.
California also holds a significant piece of legal leverage: Sable’s pipeline crosses Gaviota State Park, and the company’s right-of-way agreement with the state expired in 2016. Without state permission to use that land, the pipeline can’t legally operate.
It’s a complicated tangle, and Sable has spent more than $300,000 lobbying the federal government since 2025 trying to find a way through it.
This is almost certainly going to court, and possibly all the way to the Supreme Court. Experts describe the use of the Defense Production Act to compel a private company to resume production from idled infrastructure as unprecedented. The law has historically been used to direct production during wartime shortages, not to override state environmental and safety regulations to restart a specific oil project.
Newsom wasted no time. He called the order an “attempt to illegally restart a pipeline whose operators are facing criminal charges and prohibited by multiple court orders from restarting” and pledged California would take prompt legal action. His office framed the action as a political stunt that would contribute just 0.05 percent to total global crude output and do nothing to lower gas prices at the pump.
Congressmember Salud Carbajal made a similar argument, saying Sable’s production would be “nowhere near enough oil to lower the skyrocketing gas prices families are facing.”
The numbers are fair to scrutinize. Even at peak production, Sable’s output would replace roughly 1.5 million barrels of foreign crude per month, a meaningful figure for West Coast refineries but a drop compared to the estimated 20 million barrels per day disrupted by Iran’s closure of the strait.
What the critics don’t fully reckon with: that’s not necessarily the administration’s only argument. The Defense Production Act, they argue, is about securing domestic supply for military installations and breaking a dependency on foreign oil flowing through a waterway now controlled by a hostile power. Those are legitimate national security concerns, even if the production numbers don’t move the global market needle dramatically.
Whether the legal theory holds up is a different question. As one legal analyst put it, the case could “work its way up to the Supreme Court, because it’s an incredibly novel use of that statute.”
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