The Great Decline
California's domestic oil and gas production has been in a steep, multi-decade fall. This section visualizes the long-term trend, revealing an accelerated decline in recent years as new policies have taken effect.
Crude Oil Production Plummets
Daily output has fallen from over 1 million barrels in the 1980s to under 300,000 today. Hover over the chart to see data for any year.
Natural Gas Follows Suit
Gross withdrawals of natural gas show a similar long-term decline, reducing in-state energy resources.
Key Insight: Policy-Driven Acceleration
The decline in production isn't just geological; it's policy-driven. The rate of decline steepened significantly after 2019, coinciding with a new wave of environmental regulations. A key indicator is the dramatic drop in new oil well drilling permits issued, falling from 2,664 in 2019 to just 73 in 2024, a direct consequence of the state's new policy direction.
The Import Paradox
As local production wanes, California's thirst for energy is quenched by external sources. This growing dependency on imports exposes the state to global market volatility and geopolitical risks.
The Shifting Supply Mix
Foreign sources now dominate the crude oil supply for California's refineries, rising from 58.4% in 2019 to 63.5% in 2024.
Top Foreign Suppliers
Select a year to see the top foreign countries supplying crude oil to California. Data is in thousands of barrels.
The Refining Squeeze
California's refining capacity is critical but shrinking. Planned closures are tightening the supply-demand balance, making the state more vulnerable to price shocks from any single disruption.
Major California Refineries
| Refinery | Began Ops | Capacity (b/d) | Status |
|---|
*Capacity is in barrels per day.
Key Insight: Shrinking Safety Margin
In 2024, California's refining capacity was ~1.6 million b/d against a consumption of ~1.4 million b/d. After the Phillips 66 Wilmington refinery (139,000 b/d) closes in 2025, the state's surplus capacity will shrink to a razor-thin 6.3%. This means a single major refinery outage could plunge the state into a deficit, causing immediate supply shortages and price spikes for consumers.
Policy, Price, and a Mandated Transition
California's environmental policies are the primary drivers of the energy transition. This section explores the key laws curtailing production and their direct impact on costs for industry and consumers.
Key Laws Reshaping the Industry
Click on a law to learn more about its specific impact.
The Cost at the Pump
As of March 2025, taxes and fees add ~$0.90/gallon. Here's the breakdown.
The Rising Cost of Regulation
While California has no severance tax, the state's assessment fee on oil and gas production has skyrocketed, reflecting the increasing cost of regulatory oversight on a shrinking industry.