Oil Pushes Back Against State Climate Laws with Support from Trump

The oil industry is mounting a renewed effort to fight back against a wave of state-level climate lawsuits and regulatory actions, with hopes that a favorable White House will intervene. As highlighted in a recent Wall Street Journal article, major oil and gas companies like ExxonMobil, Chevron, and Shell are calling for federal support in response to legal threats from states including California, Vermont, and New York.

During a White House meeting last week, industry executives underscored the challenges posed by state-level “climate superfund” laws, which seek to impose billions in fines for historical greenhouse gas emissions. California’s recently proposed legislation, following the model set by New York, exemplifies this trend. Proponents of these laws argue that oil companies should shoulder the costs of climate change adaptation projects, while industry leaders contend the regulations unfairly target fossil fuel producers without considering broader consumer reliance on petroleum products.

The industry’s concerns resonate with President Trump’s pro-energy policies. With his return to the White House, the administration is exploring ways to intervene in these state-level disputes. Potential actions include filing amicus briefs to support oil companies in ongoing lawsuits or challenging the states directly on federal preemption grounds. The Justice Department may assert that climate regulation is a federal responsibility, limiting states’ authority to levy retroactive penalties.

The Weaponization of Lawfare

This is the latest example of political “lawfare:” the strategic use of the legal system to punish ideological opponents. By conflating correlation with causation, anti-oil activists and state attorneys general seek to lay blame for every climate-related event at the feet of fossil fuel producers. It’s a convenient narrative that ignores the complexities of global energy consumption and the indispensable role oil and gas play in the modern economy.

California, in particular, has positioned itself as a leader in climate litigation. Yet the state remains one of the nation’s largest consumers of petroleum products. Despite lofty goals of achieving net-zero emissions, California’s dependence on oil for transportation, manufacturing, and even the production of renewable energy infrastructure cannot be overstated. Are the politicians behind these lawsuits prepared to abandon all petroleum-based products, including plastics, medical supplies, and transportation fuels?

A Precedent of Overreach

Much like the tobacco lawsuits of the past, the current legal crusade against oil companies seeks to establish a retroactive liability for previously lawful business practices. However, unlike tobacco, the use of fossil fuels remains essential to everyday life. The legal strategy also disregards the role consumers play in driving demand. Penalizing companies without addressing the broader economic reliance on fossil fuels only serves to destabilize domestic energy production and inflate costs for consumers.

Questions to Consider:

• Are the jurisdictions suing oil companies prepared to eliminate their reliance on petroleum products entirely?

• How can the federal government ensure consistent climate policy without undermining states’ rights?

• Will Congress consider legal protections for industries facing politically motivated lawsuits?

The Road Ahead

The Supreme Court’s refusal to block state-level climate lawsuits in 2023 has emboldened plaintiffs. Now, oil companies are calling on Congress to consider legal protections akin to those granted to firearm manufacturers under the Protection of Lawful Commerce in Arms Act. With narrow Republican majorities, however, passing such legislation will be an uphill battle.

Nevertheless, oil producers are right to demand a more balanced approach. The path to a sustainable energy future requires innovation and investment, not punitive legal battles. As companies pursue carbon capture technologies, clean fuels, and emissions reduction strategies, policymakers should foster collaboration rather than perpetuate an adversarial legal environment.

CIPA will continue to monitor developments on this issue and provide updates as they unfold.