Gas prices soaring, Trump administration sets stage to OK controversial offshore oil plan
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As the war in Iran sends global fuel prices soaring, the U.S. Department of Justice has released a legal opinion claiming that President Trump has the authority to override California laws and regulations that have blocked a controversial offshore oil operation by invoking the Defense Production Act.
The 22-page opinion, published this week by the department’s Office of Legal Counsel, takes aim at the many state regulators and agencies that have not yet approved production plans from Sable Offshore Corp. — the Houston-based firm that has struggled to revive long-dormant oil infrastructure along the Santa Barbara County coast. The opinion calls the networks of offshore rigs and connected pipelines “a critical energy resource on the West Coast.”
According to the opinion, a presidential order issued under the Defense Production Act of 1950 “would preempt the California laws currently impeding Sable from resuming production and operating the associated pipeline infrastructure.”
Gas prices are on the rise amid U.S. conflict with Iran
The Defense Production Act provides the president broad authorities to influence domestic industry in the interest of national defense or emergencies. It was used by President Biden to help respond to the COVID-19 pandemic, and Trump invoked the act last March to ramp up domestic mineral production.
A representative for Sable declined to comment on the opinion. But the company has spent months courting the Trump administration for increased support of its project, especially after several legal setbacks, increasingly cumbersome state laws and ongoing financial losses have left its future in limbo.
Sable’s proposal has generated intense resistance, particularly because it seeks to restart a pipeline that ruptured in 2015, causing one of the biggest oil spills in state history. That pipeline, which Sable says it has fully repaired, was found to be severely corroded.
But the project has been stalled for more than a year as Sable has failed to secure necessary approvals from state and local officials, who have raised safety and environmental concerns about the project, finding repeated issues of noncompliance and unlawful actions by the company.
A spokesperson for California’s attorney general declined to comment on the office’s legal strategy, but said in a statement that it continues to review this development in the Sable case.
“The Trump Administration’s desire to put oil and gas interests over our communities and a clean environment continues unabated,” the statement said.
In January, state Atty. Gen. Rob Bonta challenged the Trump administration’s decision to federalize regulatory authority of Sable’s oil pipelines, which transitioned oversight of the lines from the state’s fire marshal to the U.S. Pipeline and Hazardous Materials Safety Administration. Bonta claimed it was an “unlawful power grab.”
Bonta’s office is also representing the Central Coast Water Board in a lawsuit that alleges Sable repeatedly failed to follow state laws and regulations intended to protect water resources, putting “profits over environmental protections.”
Environmental groups vowed to fight any such order issued by Trump.
“We are exploring all options to challenge what would be a blatantly unlawful order,” said Linda Krop, chief counsel for Santa Barbara-based Environmental Defense Center. “Even in these unprecedented times, this abuse of executive power would be staggering. ... The federal administration is threatening to prop up a company that has flouted the law.”
Californians already pay more than the rest of the country for gas. Now the Iran war is expected to inflict more pain at the pump.
Sable insists it has followed all relevant California laws and regulations. It says that the Santa Ynez Unit — which includes three offshore rigs in federal waters, an onshore processing facility and a network of onshore and offshore pipelines — has “massive resource potential” that could greatly benefit California’s oil supply. Sable acquired the infrastructure in 2024 after a former owner shut down operation after the 2015 spill.
The company, however, still faces criminal charges filed by the Santa Barbara County district attorney’s office, which accused Sable of knowingly violating state environmental laws during pipeline repairs. It also remains entangled in several ongoing lawsuits, including one in which a state judge ruled last week that Sable still needed to comply with state and local requirements before a restart as outlined in the federal consent decree that followed the 2015 spill.
But the U.S. attorney general’s opinion on the matter noted that the an executive order under the Defense Production Act “may displace sanctions for non-compliance with a contrary consent decree.”
It’s unclear whether Trump will issue an order usurping California’s oversight, but he has continued to call for increased domestic oil production. Even before the escalating energy crisis that followed the attacks on Iran carried out by the U.S. and Israel, and subsequent counterattacks by Iran, Trump had declared a national emergency related to the nation’s energy supply and infrastructure.
But Krop worries that these so-called emergencies are being used to circumvent necessary safety requirements — and the Sable project may just be the beginning, she worries.
“This is probably not a one-off,” Krop said. “They’re the first test of if the president can override state laws. ... They’ll try to do this ... in any state.”
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