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ADDRESSING U.S. NATIONAL SECURITY VULNERABILITIES CREATED BY CALIFORNIA OIL AND REFINERY POLICIES: THE NEED FOR A RAPID RESPONSE FUEL RESERVE
By Michael Mische, James Rector, and Joseph Silvi
September 14, 2026
This document analyzes California's oil refinery policies and recommends establishing a federally controlled fuel reserve to enhance U.S. national security and military readiness in the Pacific.
California Oil Dependency and Vulnerability
California Oil Dependency and Vulnerability
- Over 61% of California's crude oil is imported mainly from Iraq, Saudi Arabia, Brazil, Guyana, and Ecuador.
- California's reliance on foreign fuels passes through strategic maritime chokepoints, creating security risks.
- The 1970s oil shocks exposed U.S. dependence on Middle Eastern oil, prompting energy crises.
- U.S. crude production peaked in 1970 and declined due to depletion and policy restrictions, increasing import reliance.
- The U.S. SPR is concentrated along the Gulf Coast, with no direct pipelines to California.
- California's lack of infrastructure heightens vulnerability during international disruptions.
- A federally controlled California Rapid Response Fuel Reserve (RRFR) is recommended to support military needs.
- Strategies include increasing domestic production, expanding storage, reactivating refineries, and building pipelines.
- California has about 30 billion barrels of recoverable oil but faces restrictions on development.
- Federal intervention on federal lands could boost production and mitigate regulatory barriers.
- The 1973 Arab-Israeli War led to a U.S. oil embargo, causing prices to surge 71% in three months.
- The 1979 Iranian Revolution and Iran-Iraq War caused oil prices to double, severely impacting U.S. economy.
- The 1970s oil shocks prompted creation of the Department of Energy and the Strategic Petroleum Reserve (SPR).
- The SPR, with a capacity of 714 million barrels, was established to mitigate supply disruptions and stabilize prices.
- California's oil production declined 75% since 1981, increasing reliance on foreign imports to less than 2% of U.S. output.
- The state imports over 61% of its oil from foreign countries, mainly from the Middle East, increasing vulnerability.
- California reduced refineries from over 40 to 6, with closures causing capacity loss and higher prices.
- The state relies heavily on imported fuels, with imports rising 733% since 2019, mainly from foreign sources.
- The 2026 Iran conflict halted 20-22% of global oil passing through the Strait of Hormuz, raising prices.
- U.S. military action in Iran led to a 101% rise in Brent crude prices, but less severe than past shocks.
- California hosts major military bases dependent on local and imported fuels for readiness.
- The military’s logistics rely on pipelines, local refineries, and tanker imports, with vulnerabilities due to infrastructure limits.
- The U.S. has approximately 2.10 million military personnel, with 1.33 million active-duty and 770,118 reservists or Guard members.
- Civilian population involved in defense totals around 715,212.
- In 2026, the Army, Navy, Air Force, Marines, Space Force, and Coast Guard collectively comprise the force, with the Navy and Air Force holding the largest shares.
- The U.S. Air Force operates over 5,000 aircraft, consuming about 47.6 million barrels of fuel annually, mainly JP-8 jet fuel.
- The Navy’s fleet includes 300 surface ships and 11 aircraft carriers, with carrier strike groups consuming millions of gallons of jet fuel daily.
- The USMC deploys attack, transport, and utility aircraft, with significant fuel needs for operations.
- The Army uses JP-8 fuel for tanks and vehicles, with a single division consuming around 600,000 gallons daily.
- California’s declining refining capacity and reliance on foreign imports threaten U.S. military logistics.
- Establishing a California Rapid Response Fuel Reserve (RRFR) of 23-53 million barrels of crude and 961 million-2.2 billion gallons of fuel is recommended to enhance force readiness.
- California holds an estimated 30 billion barrels of recoverable crude oil but faces regulatory barriers limiting production.
- Federal intervention could increase California’s oil output to over 1 million barrels per day, supporting national security needs.
- Heavy dependence on foreign oil from the Middle East, South Korea, and Bahamas exposes California to geopolitical risks.
- Major supply chokepoints like the Strait of Hormuz and Malacca threaten fuel security during conflicts involving China or Iran.
- California’s crude oil reserves are mainly in Kern County, Monterey Formation, and offshore fields.
- The state’s refining infrastructure is limited, with many facilities shut down or constrained by regulations, hindering rapid expansion.
- China’s military buildup, artificial islands, and missile capabilities threaten regional and U.S. naval operations.
- China and Iran’s alliance could disrupt critical maritime routes and fuel supplies, impacting U.S. military and economic stability.
- California’s reserves are in six main basins, including Los Angeles and San Joaquin, with significant offshore resources.
- The state holds around 30 billion barrels of crude oil, with substantial undeveloped and recoverable reserves.
- The Los Angeles Basin is the most prolific, with estimated remaining recoverable oil of up to 5.6 billion barrels.
- Redevelopment using modern techniques could add 85,000–150,000 BOPD over five years, leveraging existing infrastructure and low geologic risk.
- Fields like Wilmington-Belmont, Beverly Hills, and Long Beach contain hundreds of millions of barrels of recoverable oil.
- Redevelopment plans include horizontal drilling, waterfloods, and seismic surveys to increase production and reduce natural seeps.
- Produces over 70% of California’s onshore oil, with remaining recoverable reserves estimated at 10–20 billion barrels.
- Developing Diatomite and deeper reservoirs with enhanced recovery could add 80,000–125,000 BOPD, despite current permit delays.
- Onshore development could increase regional output by 55,000–85,000 BOPD using advanced drilling.
- Offshore reserves in federal and state waters are estimated at over 10 billion barrels, with potential to exceed 400,000 BOPD through expanded development.
- California’s refining capacity has declined from 2 million to 1.3 million BPD, increasing reliance on foreign fuels.
- Major pipelines are nearing capacity, with reactivation of idled pipelines and refineries essential for boosting local supply and security.
- Federal jurisdiction could restore idled refineries and pipelines, bypassing restrictive state policies.
- Proposed projects include developing new refineries in Nevada and expanding pipeline infrastructure to enhance resilience and military fuel security.
- Increasing crude production and refining capacity is vital for military and civilian fuel security.
- Revitalizing existing California refineries is more cost-effective than building new facilities.
- California’s military bases require reliable, domestically produced fuels for readiness.
- Dependence on foreign imports increases vulnerability during conflicts in the Pacific.
- Kinder Morgan pipelines distribute fuels to military bases and major airports.
- Expanding storage at key sites could enhance surge capacity for military fuels.
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