California has been producing oil for more than 150 years and remains one of the largest oil-producing states in the country. The state sits atop enormous geological reserves, particularly in the San Joaquin Valley and along the southern coast, and it still pumps hundreds of thousands of barrels per day. But California’s relationship with its own oil is unusually complicated: the state simultaneously extracts a huge amount of petroleum and enforces some of the nation’s strictest environmental and public-health regulations on the industry that does the extracting.
Where California’s Oil Comes From
The bulk of California’s oil lies in a handful of sedimentary basins that formed over tens of millions of years as organic-rich marine sediments were buried, compressed, and cooked into hydrocarbons. The San Joaquin Basin, stretching through the southern Central Valley, is by far the most productive. The U.S. Geological Survey has assessed the basin’s petroleum systems in detail, mapping the source rocks, reservoir formations, and trapping structures that hold the oil in place underground.1U.S. Geological Survey Professional Paper. Petroleum Systems and Geologic Assessment of Oil and Gas in the San Joaquin Basin Province, California Kern County, at the basin’s southern end, produces more oil than any other county in the state by a wide margin.
Other significant producing areas include the Los Angeles Basin, where oil was first tapped in the late 1800s beneath what became one of the world’s largest metro areas, and the Santa Maria and Ventura basins along the central and southern coast. Smaller volumes come from the Sacramento Basin and scattered fields elsewhere. California’s oil tends to be heavy and viscous compared to the lighter crude found in states like Texas or North Dakota, and that characteristic shapes almost everything about how the state’s oil is extracted, processed, and regulated.
Why California’s Oil Is Hard to Get Out
Heavy oil does not flow easily through rock. At reservoir temperatures, much of California’s crude behaves more like thick molasses than the free-flowing liquid most people picture when they think of an oil well. Getting it to the surface requires thermal enhanced recovery methods, the most common of which is steam injection. The idea is straightforward: pump steam underground to heat the formation, which drops the oil’s viscosity enough that it can be pushed or pumped to the surface.
Conventional steam injection uses large surface boilers to generate high-pressure steam, which is then piped down the wellbore. This works, but it is energy-intensive and loses a significant amount of heat on the way down. Newer approaches, including downhole steam generation, place the steam-generating equipment inside the well itself, closer to the oil-bearing formation. Downhole generators reduce heat losses and can reach formations deeper than about 2,500 feet, where conventional steam often arrives too degraded to be effective.2IntechOpen. Downhole Steam Generation for Heavy Oil and Oil Sands Production The tradeoff is that all this steam generation burns natural gas and emits greenhouse gases, making California’s heavy oil some of the most carbon-intensive petroleum to produce anywhere in the world.
Cyclic steam stimulation (sometimes called “huff and puff”) and continuous steamflooding are both widely used in Kern County fields like Midway-Sunset and Kern River, two of the largest oil fields in the continental United States. The enormous water and energy demands of these methods have made the San Joaquin Valley a flashpoint for debates over water use, air quality, and climate policy.
Drilling in Cities
One of the most distinctive features of California’s oil industry is how close wells sit to where people live. The Los Angeles Basin contains thousands of active and idle wells scattered among residential neighborhoods, schools, and parks. Some of these wells date back a century, drilled long before modern zoning or environmental law existed. Others were drilled more recently on small urban lots, sometimes hidden behind walls or inside buildings designed to look like apartments or office towers.
Research on the health effects of living near these urban drilling sites has grown substantially in the past decade. A study of more than 600 adults in Los Angeles found that for every 100 meters closer a person lived to an active oil and gas drilling site, their diastolic blood pressure was higher by an average of about 0.7 mmHg. The association was strongest among people who had never smoked and those with a healthy body weight.3PubMed Central. Cardiovascular health and proximity to urban oil drilling in Los Angeles, California That may sound like a small shift for one person, but across a large population, even modest increases in blood pressure translate into meaningful increases in heart attacks and strokes.
Metal exposures are another concern. A study of residents living within one kilometer of a south Los Angeles drilling site found elevated levels of nickel and manganese in participants’ toenail clippings, a biomarker of longer-term exposure. Researchers used statistical methods to separate out industrial and dietary sources of metals and concluded that the nickel-manganese cluster was consistent with oil drilling activity.4PubMed Central. Metal Exposures in Residents Living near an Urban Oil Drilling Site in Los Angeles, California The communities most affected are disproportionately Black, Latino, and low-income, making urban oil drilling a prominent environmental-justice issue in the state.
Even inactive wells may pose risks. Research examining maternal proximity to oil and gas development in California and childhood cancer found a plausible link between poorly sealed inactive wells and certain rare cancers, suggesting that emissions from aging, improperly maintained wells could still be harmful.5PubMed Central. Maternal residential proximity to oil and gas development in California and the risk of childhood cancer California has tens of thousands of idle and orphaned wells across the state, and plugging them all is a slow, expensive process.
The Setback Rule and the Phaseout Debate
In 2022, California passed Senate Bill 1137, which established a 3,200-foot health and safety buffer zone between new oil and gas wells and “sensitive receptors” like homes, schools, hospitals, and parks. Existing wells within the buffer zone were required to meet stricter pollution controls. The oil industry funded a referendum to overturn the law, but voters upheld it in November 2024. The setback rule is among the most aggressive of its kind in the United States, and it effectively blocks most new drilling in urbanized parts of the state.
Separately, Governor Gavin Newsom signed an executive order in 2020 directing the state to end the issuance of new hydraulic fracturing permits by 2024, though conventional drilling permits are still granted. California’s legislature has also debated broader phaseout timelines, with some proposals targeting a complete end to in-state oil extraction by 2045. None of those more ambitious timelines have been signed into law, and the political dynamics are tricky: even in a state that prides itself on climate leadership, oil production still supports tens of thousands of jobs, generates tax revenue, and supplies refineries that produce much of the gasoline and diesel Californians burn every day.
The regulatory picture is further complicated by overlapping jurisdiction. The California Geologic Energy Management Division (CalGEM) oversees permitting and well integrity. The California Air Resources Board (CARB) regulates emissions. Regional air quality management districts impose local rules on flaring, fugitive emissions, and equipment standards. And local governments set their own zoning restrictions, with the city of Los Angeles voting in 2022 to phase out oil drilling within city limits entirely. The result is a patchwork where the rules governing a well depend heavily on exactly where it sits.
Offshore Platforms and the Decommissioning Problem
California’s coast was once dotted with active offshore platforms, most of them clustered in the Santa Barbara Channel. Twenty-seven oil and gas platforms stand offshore of southern California, and most are approaching or have already passed the end of their productive lives, with estimates putting decommissioning timelines between the mid-2010s and 2030.6PubMed. Considerations in evaluating potential socioeconomic impacts of offshore platform decommissioning in California Under existing federal lease terms, operators are required to completely remove these structures once production ends. But current state and federal laws also allow for alternative uses, and that has opened a complicated debate about what to do with these aging steel giants.
One option that has gained traction is the “rigs to reefs” concept. Over decades, platform jackets, conductors, and the shell mounds that accumulate at their bases become densely colonized by marine life. These structures function as artificial reefs, hosting diverse and productive communities of fish, invertebrates, and algae.7Bulletin of Marine Science. Decommissioning impacts on biotic assemblages associated with shell mounds beneath southern California offshore oil and gas platforms Removing a platform entirely means destroying that ecosystem. Leaving the lower portion of the jacket in place as a permanent artificial reef preserves habitat and costs less, but it also means the operator avoids the full cost of removal, raising questions about who benefits from the arrangement.
The 1969 Santa Barbara oil spill, caused by a blowout at Platform A, was one of the catalysts of the modern American environmental movement and led to a moratorium on new federal offshore leasing along much of the California coast. That moratorium has been repeatedly renewed. No new offshore platforms have been built in California waters in decades, and the political appetite for new offshore drilling is essentially nonexistent. The question now is purely about how to dismantle the infrastructure that already exists.
Produced Water and the Farm Belt
For every barrel of oil pumped in California, several barrels of water come up with it. This “produced water” is a briny, sometimes chemically complex byproduct that the industry must deal with in enormous volumes. In water-scarce parts of the San Joaquin Valley, operators have long treated and blended produced water with surface water and used the mixture for crop irrigation. The Cawelo Water District in Kern County has been doing this for over 25 years under permits from the California Water Board.
A study evaluating the environmental impact of this practice found that soils irrigated with blended produced water showed higher levels of salts and boron compared to soils irrigated with groundwater alone, suggesting long-term accumulation. The researchers concluded that continued use would require ongoing blending with fresh water and the planting of boron-tolerant crops to avoid toxicity.8PubMed. The impact of using low-saline oilfield produced water for irrigation on water and soil quality in California That is a meaningful constraint: if the water supply helps growers survive drought but slowly degrades the soil, the calculus shifts over decades.
The food safety angle is equally contentious. A risk assessment examined trace metals in crops irrigated with produced water in the Central Valley and attempted to quantify whether consuming those foods posed a health risk.9PubMed Central. Is Food Irrigated with Oilfield-Produced Water in the California Central Valley Safe to Eat? A Probabilistic Human Health Risk Assessment Evaluating Trace Metals Exposure The study was the first peer-reviewed evaluation of its kind, reflecting how little formal scrutiny the practice had received despite decades of use. California’s Central Valley grows a substantial share of the nation’s fruits, vegetables, and nuts, so the question of what goes into its irrigation water carries implications far beyond the valley itself.
Regulators have tightened monitoring in recent years, and the state commissioned its own review of produced-water reuse. But farmers in Kern County remain deeply dependent on supplemental water sources, and produced water is cheap and abundant where they need it most. The tension between agricultural water supply and long-term soil and food safety is unlikely to resolve quickly.
Old Oil Fields as Carbon Storage
As California pushes toward carbon neutrality, an ironic second life has emerged for its depleted oil and gas fields: storing carbon dioxide underground. The same geological properties that trapped oil for millions of years, porous reservoir rock capped by impermeable layers, make these formations natural candidates for injecting and sequestering COâ‚‚ captured from industrial sources or the atmosphere.
A study assessing California’s oil and gas fields as potential COâ‚‚ storage sites used a three-stage screening process. Starting from a broad inventory, researchers first identified 129 sites that met basic geological requirements like adequate formation properties and pore pressure. They then screened out sites near seismic faults, dense populations, sensitive habitats, and restricted lands. After that conservative filtering, 61 potential storage sites remained.10International Journal of Greenhouse Gas Control. Assessment of oil and gas fields in California as potential CO2 storage sites Most of these are in the San Joaquin Valley, which means the same region that has produced the most oil could eventually absorb some of the carbon the state is trying to eliminate.
Carbon capture and storage is not uncontroversial. Environmental groups worry about the technology being used to justify continued fossil fuel production rather than genuinely reducing emissions. Communities near proposed injection sites have raised concerns about induced seismicity, groundwater contamination, and the risk of COâ‚‚ leaks. California has been developing its own regulatory framework for carbon storage, separate from the federal Environmental Protection Agency’s existing underground injection program, in part to address these concerns. Whether depleted oil fields become a meaningful part of the state’s climate strategy or remain a niche pilot project depends heavily on how those regulatory and community-acceptance questions play out.
How Much Oil California Still Produces
California’s oil production has been in a long, slow decline since peaking in the mid-1980s. The state once produced over a million barrels per day; recent figures are closer to a third of that. Even so, California consistently ranks among the top seven or eight oil-producing states, ahead of places like Wyoming and behind powerhouses like Texas, New Mexico, and North Dakota. The decline reflects both geology (easy-to-reach reserves are largely tapped out) and policy (tightening regulations make new projects more expensive and harder to permit).
Despite its own production, California is a net importer of oil. The state’s refineries process far more crude than its wells produce, with the difference made up by imports from Alaska, foreign sources like Ecuador and Saudi Arabia, and pipeline deliveries from other states. California’s gasoline prices are among the highest in the country, driven by a combination of special fuel blend requirements, cap-and-trade costs, higher state taxes, and the logistics of supplying a large, isolated refining market on the West Coast.
The decline in production has not been matched by a decline in consumption. Californians still drive enormous distances, and the state’s transportation sector remains overwhelmingly dependent on liquid fuels. That gap between falling in-state production and persistent demand is a central tension in the state’s energy and climate politics. Every barrel not produced in California gets produced somewhere else and shipped in, often with its own environmental footprint from tanker traffic and pipeline operations. Critics of aggressive production phaseouts point to this dynamic as evidence that restricting California’s own industry may not actually reduce global oil consumption. Supporters counter that the state cannot credibly lead on climate while maximizing extraction within its own borders.
The question, then, is not really whether there is oil in California. There is plenty. The question is how the state navigates a transition away from producing it while managing the health, environmental, economic, and agricultural consequences of more than a century of drilling.