By: Mia Shipley
On March 13, 2026, President Trump invoked the emergency powers of the Defense Production Act (“DPA”) to boost select oil operations off of California’s southern coast.[1] This executive order comes merely ten days after the U.S. Department of Justice’s Office of Legal Counsel (“OLC”) issued an opinion that any such executive order under the DPA would preempt contrary state law, including permitting or compliance requirements.[2]
The DPA is a Cold War-era law that grants the President a set of broad powers to guide domestic industry in support of national defense.[3] “National defense” as defined in the DPA has been expanded by Congress to include terrorist attacks, natural hazards or disasters, and domestic preparedness and response, in addition to traditional military features.[4]
The DPA offers a set of authorities to the President to support national defense. Among others, the DPA allows the President to require persons and businesses to set aside private responsibilities in favor of prioritizing government contracts.[5] The DPA also provides that the President may incentivize the expansion of production and supply in support of bolstering the industrial base.[6] In his March 13th executive order, President Trump amended previous presidential delegations under the DPA to include the Secretary of Energy and the Secretary of Commerce to act and exercise certain authorities in the name of preparedness.[7] The March 13th executive order also clarifies that in the case of a declared national energy emergency, agency heads with delegated authority, such as the Secretary of Energy, may act without presidential approval.[8]
President Trump’s invocation of the DPA occurs less than a month after the U.S. conducted a series of airstrikes on Iranian leadership and military assets.[9] As a result of the attacks, Iran has blocked the Strait of Hormuz.[10] Blocking the Strait has serious global energy implications as nearly 20% of the world’s oil passes through the Strait, making it one of the world’s busiest oil transportation corridors.[11]
With an estimated 20 million barrels a day being prevented from international usage through the closing of the Strait of Hormuz, President Trump and his administration turn to the DPA to support the national defense.[12] On March 13th, 2026, the Secretary of Energy compelled Sable Offshore Corporation (“Sable”) to resume production at its Santa Ynez Unit off the southern coast of California.[13] The directive comes in an effort to address supply disruptions and shortages caused by the Strait of Hormuz’s blockage.[14]
California officials have raised concerns and objections to President Trump’s employment of the DPA, including from Governor Gavin Newsom.[15] Gov. Newsom points out that this particular use of the DPA overrides California law and an existing federal court order.[16] It is also recognized that Sable has been named in a series of charges, inquiries, and injunctions related to its practices.[17]
President Trump’s use of the DPA to compel private oil production by preempting state laws is a developing issue. Although the long-term effects are so far unknown, the general suggestion of the President’s use of the DPA is that its scope may be wider than its previous use indicates.[18] The ability to displace existing private contracts and state laws in favor of government production for reasons related to national defense is one that is likely to be heavily debated in the coming months.
[1] James M. Auslander et al., New DOJ OLC Opinion Authorizes Broad Use of the Defense Production Act to Preempt State Law and Displace Consent Decree Obligations, Nat’l Law Review, Mar. 14, 2026, https://natlawreview.com/article/new-doj-olc-opinion-authorizes-broad-use-defense-production-act-preempt-state-law.
[2] Id. This opinion came in response to a question from the Department of Energy about a company with a major oilfield off the coast of California that is being barred from production by California laws. Id.
[3] Alexandra G. Neenan, The Defense Production Act of 1950: History, Authorities, and Considerations for Congress, Congress.Gov, Oct. 6, 2023, https://www.congress.gov/crs-product/R43767.
[4] Id.
[5] Id.
[6] Id.
[7] Adjusting Certain Delegations Under the Defense Production Act (Trump EO Tracker), Akin Gump, Mar. 13, 2026, https://www.akingump.com/en/insights/blogs/trump-executive-order-tracker/adjusting-certain-delegations-under-the-defense-production-act.
[8] Id.
[9] Iran’s War With Israel and the United States, Council on Foreign Relations, last updated Mar. 13, 2026, https://www.cfr.org/global-conflict-tracker/conflict/confrontation-between-united-states-and-iran.
[10] Id.
[11] Gavin Butler et al., Strait of Hormuz: What happens if Iran shuts global oil corridor?, BBC, Mar. 12 2026, https://www.bbc.com/news/articles/c78n6p09pzno.
[12] Chuck McCutcheon, Trump seeks to tap California offshore oil, Axios, Mar. 13, 2026, https://www.axios.com/2026/03/13/trump-oil-california-iran-war.
[13] US energy secretary directs oil company to restore operations off California, AP News, Mar. 14, 2026, https://apnews.com/article/california-oil-sable-offshore-trump-13a76a0651d759bc5236bbb54ad2c13a.
[14] Id.
[15] Chuck McCutcheon, supra note 12.
[16] Id.
[17] Id. Sable “faces a criminal prosecution by a local district attorney, a federal securities inquiry, two court injunctions and findings by county officials of a pattern of noncompliance[.]” Id.
[18] James M. Auslander et al., supra note 1.