RealClearPolicy first published this opinion piece.

For decades, California oil producers have faced declining well production, a hostile regulatory regime, and a government vehemently opposed to drilling new wells. But “big oil” has persevered, squeezing out the remaining drops from their aging fields— until now, perhaps.

On September 16, Governor Gavin Newsom and Attorney General Rob Bonta sued Shell, ExxonMobil, ConocoPhillips, British Petroleum, and Chevron to make them pay their “fair share” for the climate change they allegedly cause and for “delay[ing] our transition away from fossil fuels,” as if buying their products is required. If successful in court, California’s lawsuit could slap the defendants with billions of dollars in punitive damages. Taxation by litigation, the backhanded “thank you” to the oil and gas producers that keep California’s economy cruising on physical and digital highways.

California’s economy, as the governor likes to remind us, is the fourth largest in the world. But it doesn’t run on Dunkin’—or on the wind, or the sun, or the rain. It runs on oil and natural gas. Despite sun-drenched deserts and a breezy coastline, fossil fuels still account for 70 percent of the state’s energy consumption, which does not account for the petroleum products used for fertilizer, semiconductors, electric vehicle and wind turbine lubricants, and health care. California, it seems, has an unslakable thirst for crude, but, according to Mr. Newsom, “big oil” is to blame for quenching it. And so, he filed a lawsuit with teeth to bite the hand that feeds his state.

The risk, of course, is that Governor Newsom gets his wish—less oil and gas in California. The state’s draconian anti-drilling policies already make oil artificially scarce there, but liberal state politicos demand even deeper cuts. State regulations restrict where new wells can be drilled. Hydraulic fracturing permits have not been awarded since 2021, and the governor has vowed to ban the practice entirely by next year as part of his pledge to end oil production in the state by 2045. 

Without new wells, California’s oil supply will inevitably run dry. Some oil and gas producers have taken the hint and left, and last year Shell and ExxonMobil read the room and sold off more than 23,000 California wells even though locally produced crudes were nearly $100 per barrel, well above profit margins. Chevron, California’s oldest oil company, kept its wells, but followed Tesla out of California and moved its corporate headquarters to oil-friendly Texas.

California’s quixotic quest to make the oil and gas industry unprofitable from Oregon to Baja—epitomized by the state’s latest lawsuit—has not, in fact, reduced its oil consumption, it has simply made oil products, like gasoline, more expensive for its residents. Content to let others utilize natural resources and ship them across the ocean or over the mountains, California currently imports more than half of its oil from foreign countries, for which it pays a significant premium. And because it relies so heavily on imported, foreign-sourced oil that doesn’t come with free shipping, Californians regularly pay the highest gas prices in the nation. The governor wants to chase what little energy security remains out the door with a gavel.

Without big oil, California will soon be entirely dependent on expensive foreign crude. And for Governor Newsom, that seems to be a feature, not a bug. Joining a long series of misguided policies, pledges, and commitments, his lawsuit is just the latest skirmish in the state’s multi-theater war on U.S. oil. It will grease the skids for oil companies already sliding toward the exits, and it will help ensure that virtually everything—not just gasoline or the electric bill—will cost more in California tomorrow than it does today. But rest assured, it’s all part of Mr. Newsom’s oil-free California dream.

Trevor Lewis is an economic policy analyst at The Buckeye Institute.