Description
Key insights and conclusions from our analysis include:
| * | Policymakers should look at cumulative policy impacts: When seen in the aggregate, multiple policies can exacerbate each other leading to unintended consequences which might quickly destabilize the fuel supply system | |
| * | California crude oil production is in sharp decline: Crude oil production is declining at an annual decline rate of 15%, which is not due to a lack of resources, but by the slowing pace of issuing necessary permits. | |
| * | Crude oil pipelines are approaching minimum volumes: If pipeline flows drop below their minimum volume, they have to be shut-in for safety and economic reasons. Our analysis shows several pipelines might be approaching closure risk. | |
| * | Growing marine movements eventually reach limits: Crude oil production declining faster than demand requires increasing tanker imports. Vessel traffic congestion is not just an import issue, with increasing exports of petroleum diesel as renewable diesel captures California market share. | |
| * | Petroleum refiners will soon face difficult decisions: Our scenarios show a series of “cliffs and hard landings” with risks of growing price volatility. Some refining companies might be making decisions very soon because from a planning perspective, it’s already 2030. |
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