"California is on Life Support"– Michael Mische, USC

Today we were fortunate to visit with our good friend Michael Mische, Associate Professor of Management at the University of Southern California’s Marshall School of Business. We were particularly interested in discussing his latest article, “California Gasoline Supply Outlook: A Disaster in the Making” (linked here). The article outlines a near-term outlook of acute gasoline supply shortages in California, driven by refinery closures, declining in-state crude production, and disrupted imports, raising the likelihood of higher prices and potential physical shortages in the weeks ahead. Mike Bradley and Maynard were pleased to hear Michael’s perspectives on this important and timely issue. In our conversation, Michael walks us through the combined impact of declining in-state crude production, refinery closures, import dependence, California’s special gasoline blend requirements, and how these factors have contributed to a more constrained and less flexible fuel system. We discuss how recent global supply disruptions are interacting with these structural dynamics, tightening inventories and increasing the risk of near-term supply pressures. We also explore affordability, regulatory complexity, and the broader policy tradeoffs shaping California’s energy system, including the role of fuel standards, taxation, and investment incentives. Michael shares his perspective on potential policy responses, including both state-level actions and a set of proposed federal executive orders aimed at increasing production, supporting refining capacity, and accelerating critical infrastructure. We examine potential pathways forward, from temporary regulatory adjustments to longer-term solutions such as expanding production, refining capacity, and pipeline infrastructure, and what these considerations could mean for consumers, policymakers, national security, and the evolving political landscape in the state. We greatly appreciate Michael for sharing his time and insights.