Interview: California Secretary Weighs Petroleum Supply Needs Against Energy Transition
California Natural Resources Agency Secretary Wade Crowfoot said in an interview with Dow Jones Energy that while the state’s relationship with the petroleum sector remains “fairly stable,” decisions surrounding petroleum assets will pose challenges in coming years.
“As we reduce our demand for gasoline and oil, there will be decisions that are made about keeping assets running, and, in the coming years, these are challenges we’re going to need to contend with,” Crowfoot said. “We think (refiners are) a natural part of this transition as demand reduces for fossil fuels, and companies ultimately are making decisions around where to invest or reinvest their capital around the world.”
Crowfoot leads the California Natural Resources Agency, a Cabinet-level agency that oversees divisions focused on managing the state’s natural resources, including the California Energy Commission, California Geologic Energy Management Division (CalGEM) and the California Coastal Commission, among others.
He said stability with the refining sector became “an intense focus” after the recent loss of two major refineries in California, which slashed roughly 18% of the state’s fuel production capacity. He added that the state is focused on a transparent and reliable transition plan, which aims to stabilize the market, protect displaced communities from the transition and provide infrastructure strategies that can sustain decisions from in-state refiners.
Some of the state’s refiners, represented by the Western States Petroleum Association, in a recent letter addressed to the CEC urged California to “protect what remains,” by providing the petroleum sector regulatory certainty for long-term investment.
“There is an inherent tension with a sector who sell the product that we need to move away from,” Crowfoot said. “Our north star is very clear: moving away from fossil fuels to clean, abundant, reliable energy, and this transition will take decades. Within that time, there’s still a profitable opportunity for companies to serve California’s fuel needs.”
With a complete transition decades away, Crowfoot’s agency – primarily through the California Energy Commission – is working with upstream producers to increase in-state crude oil production and with refiners to maintain a dynamic supply of imported refined gasoline. Crowfoot added that the state is focused on a resilient supply of traditional fuels with a stable mix of in-state production and imports.
California averaged around 288,000 b/d of crude oil production in 2025, according to the U.S. Energy Information Administration. In 2026, crude oil production remained between 245,000 b/d to 256,000 b/d through June, EIA data show.
While he did not comment on an exact number for sufficient crude oil production in the state, Crowfoot cited a dynamic market in which when production is down, imports increase.
Imported shipments of finished gasoline this year have reached as high as 235,000 b/d in May.
“As this transition evolves and deepens, imports have demonstrated that they can supply in-state supply,” he said. “But at the same time, our leaders have said that, for now, it’s important to maintain a mixture of in-state supply along with these refining imports.”
Crowfoot emphasized that the state is prioritizing “adaptive management,” which promotes less of an import-first approach and more of a combined approach of local and international fuel supply. He highlighted the increased approval of oil drilling permits in Kern County as a significant lever to stabilize production in the state.
As of Oct. 12, Kern County accounts for 422 of California’s 437 issued new drill permits in 2026, according to CalGEM.
“As I understand it, many of those permits have been approved, but the drilling and production has not yet started … in coming months and years, we’ll see those permits really turn into increased production back towards stabilizing production,” Crowfoot said.
Since March, CNRA, along with others, has navigated the resumption of operations for an offshore oil pipeline through the Santa Barbara coast. The pipeline, operated by Sable Offshore Corp., led to one of the largest oil spills in the state in 2015. The state and Sable are currently embroiled in a slew of lawsuits against each other.
In May, the National Oceanic and Atmospheric Administration began a formal review of California’s coastal management program under the Coastal Zone Management Act. The review would examine how the state’s coastal management practices have addressed economic development, federal priorities related to spaceport infrastructure, offshore oil production, pipeline maintenance and other priorities, the U.S. Department of Commerce said in May.
Despite its concern about the review, the California Coastal Commission is participating in the review process, Crowfoot said.
“We’re confident we’re going to be able to defend our coastal zone management program,” he said. “If it comes to it and the program gets removed against the federal act, then obviously we’ll be challenging that.”
With a 2045 deadline for the energy transition, questions have materialized about whether the state is discussing safeguards or delays in its transition.
“The short answer is no,” Crowfoot said.