Trump Invokes Defense Production Act to Restart California Oil Pipeline Amid Iran War

President Trump has invoked emergency powers under the Defense Production Act to compel the restart of the Santa Ynez offshore oil platform and pipeline along the California coast, which was shut down following a 2015 oil spill. The move comes as gas prices surge in the wake of the ongoing war with Iran and aims to bolster the nation’s oil supply.

Executive Order and Department of Energy Directive

On Friday, March 12, 2026, President Trump signed an executive order granting the Department of Energy the authority to utilize the Defense Production Act to expedite oil and gas development. Energy Secretary Chris Wright subsequently directed Sable Offshore Corp. To resume operations of the Santa Ynez Unit, encompassing offshore oil rigs and a pipeline network serving the Santa Barbara County coast. According to a statement from Secretary Wright, this action 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.”

Political and Legal Opposition

California Governor Gavin Newsom strongly criticized the decision, labeling it an “attempt to illegally restart a pipeline whose operators are facing criminal charges and prohibited by multiple court orders from restarting.” Newsom asserted that the Trump administration initiated the war with Iran knowing it would elevate gas prices and is now leveraging the conflict to benefit the oil industry at the expense of California’s coastline. He has pledged to pursue legal action against the administration’s directive.

Background of the Santa Ynez Unit and Sable Offshore

The Santa Ynez Unit facilities, acquired by Houston-based Sable Offshore Corp. From Exxon in 2024, have the potential to produce approximately 50,000 barrels of oil per day, potentially replacing around 1.5 million barrels of foreign crude monthly, according to the Department of Energy. However, this output is considered minimal compared to the estimated 20 million barrels per day disrupted by Iran’s closure of the Strait of Hormuz in response to U.S. And Israeli military actions.

Concerns Over Limited Impact on Gas Prices

Critics argue that restarting the Sable project will have a negligible effect on lowering soaring gas prices. U.S. Representative Salud Carbajal (D-Santa Barbara) stated that the project’s limited oil production is a “hollow solution” to a crisis caused by the “reckless war” initiated by President Trump. Experts note that U.S. Oil is sold on the global market at prevailing prices, meaning American consumers will not necessarily benefit from a discount.

Defense Production Act and Legal Justification

The Defense Production Act, originally enacted during the Cold War, grants the President broad authority to influence domestic industry for national defense or emergency purposes. It was previously used by the Biden administration to address the COVID-19 pandemic and by Trump to increase domestic mineral production. A legal opinion released by the U.S. Department of Justice earlier in March 2026 affirmed the Act’s applicability to override California laws hindering Sable’s resumption of production.

Ongoing Legal Challenges and Environmental Concerns

Sable Offshore continues to await approvals from the California Coastal Commission and California State Parks. The company has faced numerous lawsuits from environmental groups challenging waivers to pipeline safety requirements and alleging unlawful work in sensitive coastal habitats. The Santa Barbara District Attorney has filed criminal charges against Sable for alleged unlawful discharge into waterways, and the California Attorney General has also filed suit alleging regulatory overreach by the Trump administration. Federal regulators are also investigating potential improper disclosure of investor information by Sable, according to Bloomberg.

Current Market Conditions

As of mid-March 2026, two weeks into the war with Iran, crude oil prices have reached $100 per barrel, and the average price of gasoline in California has exceeded $5.40 per gallon, according to the American Automobile Association.