How Trump Is Trying to Crush California’s Environmental Policies

At least a half-dozen federal agencies have taken action against the state that has led the nation in environmental protections.

By Maxine Joselow, The New York Times, Aug. 20, 2026

The Trump administration has taken a series of extraordinary steps to attack California’s position as a national leader in environmental protection, enlisting at least a half-dozen federal agencies to undermine the state’s efforts to pivot away from fossil fuels.

The stakes are high. Because of its market muscle as the world’s fourth largest economy, California’s environmental regulations have influenced the manufacturers of automobiles and other consumer goods. And its green policies have spread to some other states in what’s known as the “California effect.”

But President Trump has marshaled the full power of the federal government to clamp down on the state’s climate initiatives. He has been vocal in his contempt for Gov. Gavin Newsom of California, a Democrat and possible 2028 presidential contender whom he refers to as “Gavin Newscum.”

Mr. Newsom, a loud and pointed critic of Mr. Trump, pledged soon after the 2024 election to insulate California’s environmental policies from a second Trump administration — perhaps making the state an inviting target for a president who has been using government levers to punish perceived enemies.

There are almost too many examples to list.

Mr. Trump and his Republican allies in Congress have blocked California from setting its own limits on automobile pollution, which federal law has permitted since the 1970s. The Energy Department has announced $75 million for a new coal export terminal in Oakland, Calif. The Interior Department has paid energy companies to cancel planned wind farms off the coast of California and other blue states. The president ordered a company to restart a pipeline that caused one of the state’s largest oil spills in 2015.

And just last week, the National Oceanic and Atmospheric Administration signaled it could curb the power of the California Coastal Commission, a state agency that has protected the shoreline from threats like oil spills for more than half a century.

Mr. Trump’s “destructive behavior has grown significantly,” said Jerry Brown, the former four-term Democratic governor of California who made climate change a signature cause. “It’s completely against a traditional Republican doctrine of respecting states’ rights.”

The state has filed a slew of lawsuits to try to undo the administration’s actions.

“Donald Trump attacks California because we are building a future that doesn’t depend on fossil fuels,” Anthony Martinez, a spokesman for Mr. Newsom, said in an email. “This fading industry desperately attempts to tighten its grip on the world economy even as clean energy dominates, growing cheaper and faster to deploy than anything they can offer. Follow the money, and you will find the truth behind his war on California’s climate policies: this is a White House run for Big Oil, by Big Oil.”

Taylor Rogers, a White House spokeswoman, said the administration was intervening in California because state policies had led to higher energy prices and oil refinery closures, though analysts say market forces have also fueled these trends.

“Governor Newscum has continued carrying out the left’s costly and unpopular green new scam,” Ms. Rogers said in an email. “President Trump is working relentlessly to reverse the damage done by California Democrats and unleash American energy dominance.”

Richard Goldberg, a former senior counselor for the National Energy Dominance Council, which Mr. Trump created last year to coordinate energy policy, said the White House had genuine policy disagreements with California, but it also saw a political advantage in feuding with Mr. Newsom.

“I would say it’s probably a beneficial byproduct that it happens to be Newsom,” Mr. Goldberg said. “But regardless of who the governor is, California has important energy resources that are needed for the country’s national security.”

California’s 840 miles of coastline are one of its most treasured resources, drawing millions of tourists and locals annually and stretching from redwood forests in the north to palm-tree-studded beaches in the south.

In his first term, Mr. Trump largely left the coast alone, with the exception of an unsuccessful attempt to spur offshore oil and gas drilling. This time, his administration has sought to bring not only more oil rigs, but also more pipelines and possibly more rocket launches by SpaceX from a coastal military base.

In November, the Interior Department announced a draft plan to allow new oil drilling in federal waters off California for the first time in roughly four decades. The plan called for up to six oil and gas lease sales in those waters, including in an expanse off Santa Barbara where a 1969 oil spill galvanized the modern environmental movement.

Asked about the proposal at the time, Mr. Newsom rolled his eyes and called it “dead on arrival in California.” He said that the state would “absolutely” challenge the plan in court once it was finalized.

The clash over the coast was just beginning, and an offshore oil pipeline would be the next sticking point.

In March, Mr. Trump ordered the Houston-based company Sable Offshore Corp. to restart its pipeline off Santa Barbara, even though state agencies had denied permits for the project, saying it had failed to fix damage that led to a 2015 oil spill. To justify the move, the president invoked a Cold War-era law that the administration said superseded state regulations.

The law, the Defense Production Act, has typically been used in emergencies like hurricanes and the Covid-19 pandemic. In this case, the administration said the emergency was an energy shortage in California fueled by the war in Iran, which had choked global oil supplies.

Yet the administration has also paid energy companies hundreds of millions of dollars to cancel planned wind farms in the waters off California.

“It really is the definition of hypocrisy to say that we’re in a national energy emergency and we need to empower companies like Sable, but at the same time, we’re paying taxpayer dollars to not do offshore wind projects,” said Alex Katz, the executive director of the Environmental Defense Center, a nonprofit based in Santa Barbara.

Last week, the administration opened a new front in its efforts to wrest control of the coast. The National Oceanic and Atmospheric Administration held a public hearing in Santa Monica, Calif., to reconsider the power of the California Coastal Commission, which for more than half a century has had the legal authority to review and object to federal actions or projects that affect coastal resources.

Mr. Trump has long complained about the commission, which once tried to stop him from erecting a 70-foot flag on his oceanfront golf course near Los Angeles. Elon Musk, a Trump ally, has also tangled with the agency over increasing the number of SpaceX rocket launches from Vandenberg Space Force Base in Santa Barbara County.

The review could lead to the commission losing federal certification of its programs or federal grants that account for 10 percent of its budget. If the administration succeeds, it could also set a precedent for similar actions in other coastal states.

“There could be an impact on what happens in Oregon if California no longer has this authority,” said Charles Lester, a marine science researcher at the University of California at Santa Barbara and a former executive director of the coastal commission.

A Multi-State Fight

Another environmental showdown between California and the Trump administration could also reverberate far beyond the state’s borders, affecting vehicles sold across the country.

This fight dates back to the 1970s, when heavy smog choked Los Angeles. In response, Congress passed the Clean Air Act, which explicitly allowed California to set automobile pollution standards that were stricter than federal rules, as long as the state obtained waivers from the Environmental Protection Agency. The landmark law also allowed other states to adopt California’s standards.

Ever since, the waivers have helped rein in smog-forming pollutants like soot and nitrogen dioxide that can contribute to asthma and lung disease. They have also been a powerful tool for curbing greenhouse gases like carbon dioxide, the main driver of climate change.

Mr. Trump and his Republican allies in Congress have shattered that dynamic.

Last year, Mr. Trump signed a congressional resolution to revoke a waiver that had allowed California to ban sales of new gas cars by 2035. And in June, Lee Zeldin, the E.P.A. administrator, urged Congress to rescind waivers for four other emissions rules affecting everything from light trucks to lawn mowers.

California has filed multiple lawsuits to maintain its vehicle rules. At a hearing on Wednesday, a Justice Department attorney argued that the state lacked standing to sue over the four additional waivers because Congress hadn’t yet acted on them. A federal judge will soon decide that question.

The outcome of these legal battles could dictate the types of vehicles available at dealerships nationwide, said Casey Katims, the executive director of the U.S. Climate Alliance, a bipartisan coalition of governors working on climate policy. He noted that 11 other states have pledged to follow California’s lead in banning gas car sales by 2035, representing more than 40 percent of the U.S. vehicle market.

“Attempts to block climate progress in California,” he said, “don’t live just in California.”

Brad Plumer contributed reporting.

https://www.nytimes.com/2026/08/20/climate/trump-california-climate.html?campaign_id=54&emc=edit_clim_20260823&instance_id=180811&nl=climate-forward&regi_id=66704053&segment_id=225291&user_id=97eb24ff9121d1a70f01fac05f86ea1b

How the hard reality of climate change hit Europe's economy this summer

By Balazs Koranyi, Reuters, August 10, 2026

FRANKFURT - For anyone in Europe who still thought climate change was a problem for future generations, this summer's sweltering heatwaves have brought home the reality that its costly and life-altering economic impacts have already arrived.

Record heat and droughts this summer - which scientists say are exacerbated ​by global warming - have wreaked havoc in power production, shipping and public health systems, while this wildfire season is on track to be Europe's biggest ever, opens new tab.

Together, the hit to the region's economy can already be ‌measured in the hundreds of billions of euros, economists and academics estimate. But they warn this is just the beginning, as costs are set to rise faster than temperatures.

Climate is changing more rapidly in Europe than on any other continent and the damage is already stretching public finances, setting off wild swings in inflation, redrawing the tourism map, and forcing the bloc to rethink how power is produced and how goods are transported.

"What makes 2026 particularly worrying from an economic perspective is that there are multiple episodes of extreme events," said University of Mannheim economist ​Sehrish Usman.

"Take heatwaves, droughts, wildfires... these events are taking place at the same time and mostly in the same regions, compounding their impact," she said.

RECORD ECONOMIC DAMAGE FROM HEAT

Temperatures hit records in June and July, and the ​economic damage will likely exceed all previous marks, economists say.

Traffic on the Rhine and the Danube rivers, key cargo arteries, is severely limited because of low water levels, more ⁠than a half dozen nuclear generators have shut or curtailed production due to cooling difficulties. Agricultural yield estimates have been cut with crops harvested late, such as maize and sunflower, suffering a 6-7% loss already in July.

Heat curtails human productivity and ​has already claimed tens of thousands of lives, with Germany alone reporting more than 10,000 heat-related deaths.

Meanwhile, the costs of the emergency response, like fighting fires or curtailing power use, further stretch budgets.

ING estimates that the halt of traffic on the Rhine ​alone will lower the GDP of Germany, the world's third-largest economy, by 0.3 percentage points this year, while Hungary's MBH Bank sees a 0.1 percentage point GDP hit for every week the country's largest nuclear generator is offline.

Allianz, the German insurer, estimates the two-week June heatwave alone will cut the GDP of Europe by 0.3 percentage points, and climate change will shave 5-7% off growth by 2030 for the most exposed economies like Spain, France and Italy.

"The total bill for this year will be much larger," said Hazem Krichene, an economist at Allianz. "This figure ​doesn’t account for the fires, droughts, different flood events or the expected El Niño."

Given that the euro zone is expected to grow just 1% this year, the hit is sizable.

Yet Usman says the full extent of the economic damage will ​only be felt several years down the line.

"You'd expect the damage to be largest in the year an extreme event happens and then to fade but we find the opposite," Usman said. "The economic impact grows over the following years because the extreme weather set off ‌a chain of ⁠slow economic consequences."

SOUTHERN EUROPE TO SUFFER FALLING TOURISM AND RISING INFLATION

Southern Europe could take the biggest hit as temperature spikes are the largest there, cutting tourism income, exacerbating crop failures and inducing outward migration.

"Can you see tourists marching through southern Italy or Spain in 45 degrees? I can't. So, I think the nature of tourism will change," ING economist Carsten Brzeski said.

The south may get more year-round tourists but summer peaks will drop as vacationers move north, hitting the southern hospitality industry, Brzeski argued.

The south will also take a bigger food price hit from extreme weather, complicating life for the European Central Bank, which is already struggling to keep inflation at target.

"You see bigger effects of extreme temperatures on food prices in places that are already ​hotter, so if you're in Southern Europe, you'll see ​a bigger effect," said Maximilian Kotz, a researcher at ⁠the Barcelona Supercomputing Center.

Extreme heat in 2022 lifted euro zone inflation by 0.34 percentage points via higher food prices, with the south taking a disproportionate hit, Kotz estimated.

Meanwhile, a halt in river transport is making it harder for fuel to reach parts of Europe, widening regional price differences.

HEAT STRAINS ON BUDGETS TO PUT PRESSURE ON ECB

"The fiscal consequences fall most heavily on ​the economies least able to absorb them," Allianz said in a research note.

Reductions in annual tax revenue from lost output could reach 1.8% in France, 1.3% in Italy and ​Spain as progressive tax systems mean ⁠revenues fall faster than output, it estimates.

Business profit margins will also decline, depressing investment and exacerbating the economic loss.

Costs meanwhile surge, both because governments have to fund the emergency response and must invest, such as in future-proofing power generation or transportation routes.

"A key concern is that countries still rely far too much on ad hoc emergency response, which is both expensive and also often quite inefficient," said Heather Grabbe, a senior fellow at the Bruegel think tank.

But investors may push back if governments try to spend more. ⁠Debt levels are ​already high - especially in France and Italy - and countries need to invest in defence and the green energy transition.

The dilemma could draw in the ​ECB, which bought up trillions of euros worth of countries' debt in the past decade to keep borrowing costs depressed when inflation was too low.

"With such a long list of spending needs, the trend will be towards higher government debt," ING's Brzeski said. "This will then mean pressure on the ECB ​to step in and do more quantitative easing, if there is a sudden selloff in bond markets."

https://www.reuters.com/business/environment/how-hard-reality-climate-change-hit-europes-economy-this-summer-2026-08-10/?utm_source=Sailthru&utm_medium=Newsletter&utm_campaign=Daily-Briefing&utm_term=081026&lctg=63da3ddf6bb4e85305091e58&user_email=5ed957ca1eefc49380b1b0c0e01fd14feff0e0a2c8584e0cf002bd0dc0c874ef

Climate's Compounding Financial Toll Is Becoming Harder to Ignore

By Justin Worland, Time magazine, July 18, 2026

It’s felt all but impossible to escape the reality of our changing climate this past month, from extreme heat at London Climate Action Week to wildfire smoke across the U.S. northeast and midwest. While each individual event is dramatic in its own right, I’ve been struck by the breadth. Everywhere seems to be undergoing its own unique climate event at the same time. 

In many conversations, climate change gets boiled down to individual events, or even just the simple sum of multiple events. But the impacts this summer offer a useful reminder that it’s not so simple. While economies may be able to absorb one climate shock, the risks grow when they accumulate and occur across geographies and assets simultaneously. You might call it “death by a thousand cuts.”

Already, this bludgeoning has become visible in insurance markets. Insurance is an obvious place for these challenges to show up first. Insurers price based on short-term risk and can’t defer a loss the way an equity investor can, so they either raise prices or exit the market. We’ve already seen those in the most at-risk markets, including both Florida and California. 

But insurance is not alone. We’re starting to see indicators of other, similar slow-moving financial disasters. Earlier this month, the Bank of England quietly said that climate change was creating a spending pressure on governments, contributing to growing sovereign debt loads. Last month, the International Monetary Fund warned that climate disasters were creating an “impossible trilemma” for countries. Disasters drive countries to take on more debt, making it harder to fund the adaptation necessary to prepare, and then face higher default risk.  

This is a dangerous cycle with implications for investors and businesses across the economy. Sovereign debt flows through to the rest of the economy. Too much of it leads to higher interest rates for businesses, lower private investment, and lower growth. One disaster, even a record one, can be absorbed. The danger is when they all happen at once, and then continue to happen. A never-ending string of extreme events threatens economic havoc in a way one event doesn’t.

Thus far, capital markets more broadly have been slow to respond to this threat for a variety of reasons. Climate risk is difficult to model and plays out over long time-periods. Meanwhile, investors discount future risks and prioritize quick returns. And, importantly, they generally expect that events will be non-correlated and therefore easier to absorb.   

This view may change. The Bank of England warned last December of the possibility of a climate Minsky moment, where assets reprice rapidly due to climate shock. It’s also possible that repricing happens gradually over time. In any event, the cumulative effect of concurrent disasters should not be taken lightly. Markets often ignore risks when they feel isolated, or idiosyncratic, but once they are understood as systemic they are priced. 

For many who work in climate, this season of extremes has revived the longstanding prediction that the effects of rising global temperatures will help drive a resurgence in concern among policymakers and the general public. I hope so, but I’m not so sure. While some studies have suggested extreme weather events can drive support for climate action, many others have shown minimal effect. And we’ve also seen the opposite effect: climate events that triggered populist backlash led by anti-climate politicians.

While it’s hard to predict how exactly these events will shape public engagement on climate, markets have a simpler logic to them. Climate related events are exacting a growing cost. And it’s now clear both that those costs will grow and that economies aren’t fully prepared. If and when investors look at the same information and determine that those costs aren’t fully accounted for, asset prices will take a hit.

https://time.com/article/2026/07/17/climate-impacts-economic-risk/

A renewables playbook for the rest of Trump 2.0

By Ben Geman, Axios, July 8, 2026

A top renewables and storage group sees openings for progress on Capitol Hill as it looks to build more nationwide power on the political right.

Why it matters: Trump officials are targeting wind power, which the president overtly despises, and last year's GOP budget law phased out tax credits for wind and solar generation projects.

Driving the news: American Clean Power Association CEO Jason Grumet on Tuesday briefed reporters on the group's strategy — on and off Capitol Hill — in the near and longer term.

A few highlights of its quest for "policy durability"...

📃 Permitting: A big bipartisan deal is a top priority in this Congress — and one Grumet acknowledges is looking dicey.

• "We think the window of opportunity there is starting to close," he said, noting that a bipartisan Senate proposal from leaders of the environment and energy committees has yet to surface.

• Grumet's not especially hopeful about a lame duck deal.

💵 Tax policy: In the next Congress — assuming Democrats win control of at least one chamber — the group sees openings for new credits that support transmission projects, and improving incentives for domestic manufacturing.

• "We look forward to the opportunity, as we move into what we anticipate is divided government, to restore some of the bipartisan support for this industry," Grumet said.

• Boosting transmission would help ensure the grid is adequate for all energy technologies, he said.

🚢 Tariffs and trade: "We think there is growing discomfort in the Congress about the way tariffs are being used," Grumet said.

• There may be opportunities for Congress to make tariff policy less volatile, he said.

💪 Building power among conservatives: The group has been expanding its communications and messaging.

One channel is the pro-solar "American Energy First" coalition of companies created in late 2025 that's affiliated with the group. It includes "clean energy companies that have worked together to activate a network of conservative thought leaders and digital influencers," Grumet said.

• Work to date included a poll conducted by former Trump adviser Kellyanne Conway's firm.

• American Clean Power created a separate new grassroots effort last year called PowerVotes that aims to mobilize conservative support for permitting reform and state-level project siting work.

• And it's expanding efforts to build support across the political spectrum via platforms like TikTok, Substack and Instagram.

What's next: American Clean Power will help a group of member companies launch a major new consumer outreach campaign this fall about the benefits of clean energy.

• "It's really the first time that the industry is putting significant resources behind that kind of consumer engagement, consumer awareness," Grumet said.

https://www.axios.com/2026/07/08/american-clean-power-renewables-strategy-trump

Trump Administration Pays Duke Energy $129 Million to Halt Offshore Wind Farm

It was the fourth such deal struck by the administration to get companies to forfeit their offshore wind leases.

By Maxine Joselow, The New York Times, June 29, 2026

The Trump administration on Monday said it would pay Duke Energy $129 million to abandon its plans to build an offshore wind farm off North Carolina.

It was the fourth such deal struck by the administration to throttle the development of offshore wind power, a source of renewable energy that President Trump has disparaged for decades.

Under the agreement, Duke Energy would surrender its lease in federal waters for a wind farm that was planned in the Carolina Long Bay area, roughly 15 to 22 miles off southeastern North Carolina. The project was in the early stages of development and construction had not yet begun.

The government plans to reimburse Duke Energy $129 million, slightly less than the amount that the utility paid for the lease under the Biden administration. Duke Energy would then reinvest that money in other sources of energy favored by the Trump administration, which could include new nuclear and natural gas projects, according to the utility.

Scientists and environmentalists say that offshore wind farms could play a crucial role in the fight against climate change. Unlike burning fossil fuels, wind turbines do not generate any of the greenhouse gases that are dangerously warming the planet. And unlike large-scale solar farms, they do not take up vast amounts of valuable land.

The Trump administration, however, has criticized offshore wind projects as ugly and inefficient.

“President Trump’s vision of unleashing affordable, reliable American energy for our country’s communities and using common sense to put the American people first is being implemented,” Interior Secretary Doug Burgum said in a statement on Monday.

Mr. Burgum also repeated his earlier claims that offshore wind farms threaten national security. Last year, the Interior Department cited those concerns when ordering a halt to the construction of five other wind farms off the East Coast, saying their spinning turbines could interfere with military radar. But several federal judges struck down the stop-work orders, saying they were unpersuaded by the administration’s arguments.

After its losses in court, the administration pivoted to a new strategy: paying developers to walk away from offshore wind projects. It struck the first such deal in March with the French energy company TotalEnergies.

That deal saw the government pay TotalEnergies nearly $1 billion to abandon plans to build two wind farms, one off New York and the other in the same area off North Carolina. Seven Democratic-controlled states have sued the administration over that agreement, calling it an illegal use of taxpayer dollars.

The latest deal with Duke Energy means the government has so far committed to spend more than $2.5 billion to get companies to terminate their offshore wind leases.

Duke Energy, based in Charlotte, N.C., is one of the nation’s largest utilities. It provides electricity to roughly 8.7 million customers in six states and natural gas to roughly 1.6 million customers in four states.

“This settlement allows Duke Energy to refocus $129 million in ways that directly benefit our customers and communities in the Carolinas,” Kodwo Ghartey-Tagoe, the executive vice president and chief executive of Duke Energy Carolinas, said in a statement.

Riley Cook, a spokesman for Duke Energy, said in an email that the $129 million would be reinvested in “reliable, diverse energy sources that can help meet growing demand” for electricity. He said the investments could flow to nuclear reactors and “grid infrastructure projects” in the Carolinas, though he did not provide specific details.

But Pasha Feinberg, an offshore wind strategist at the Natural Resources Defense Council, an environmental group, said the scuttled wind project could have helped meet soaring power demand, too.

“We need more electricity, not less,” Ms. Feinberg said in a statement. “Canceling clean energy projects is self-defeating. Paying off companies so they will abandon them is just ludicrous.”

Gov. Josh Stein, Democrat of North Carolina, also sharply criticized the agreement.

“The Trump administration is strong-arming companies into abandoning clean energy, and the industry is folding like a beach chair,” Mr. Stein said in a statement, adding that his state needed the power and jobs that the wind project would have generated.

https://www.nytimes.com/2026/06/29/climate/trump-offshore-wind-duke-energy.html

America’s Thirst for Gasoline May Not Recover After Iran War

People drove less and bought more-efficient cars when fuel prices surged, habits that could stick over the long term.

By Lydia DePillis, The New York Times, June 23, 2026

Judy Vassallo, an 89-year-old retired art teacher who lives on her own in a leafy neighborhood just north of Center City in Philadelphia, used to take her 2002 Honda CRV to the suburbs for a visit with friends, or downtown for doctor appointments and Pilates classes.

But since gasoline prices shot up after the United States and Israel attacked Iran in late February, she couldn’t stomach paying nearly twice as much to fill her tank. Instead, Ms. Vassallo started taking the city bus, which is free for seniors. She found that she liked it — saving on gas and parking tickets.

“Once it becomes a habit, it’s not an onerous thing, it’s built into the pattern of my behavior,” Ms. Vassallo said. “You’re going into the city, you’re going to take the bus. And I’m finding that it’s so much easier.”

Americans are powerfully attached to their cars, and their spending at gasoline stations jumped 21 percent from February to May. But that ability to spend has limits. According to Dow Jones Energy, consumption was 6.1 percent lower in May from a year earlier. Some of that is a long-running trend owing to the increasing efficiency of passenger vehicles, said Denton Cinquegrana, the company’s chief oil analyst, and about half is probably a consumer response to higher prices.

Much of that response comes from people forgoing discretionary driving, like road trips and grandchildren’s traveling sports games, particularly those with lower incomes. But in recent years, Americans have also gained greater ability to adapt, as more employers have allowed for telecommuting and more electric vehicles have arrived on the market.

“There’s more flexibility within working situations,” Mr. Cinquegrana said.

Despite the car-dependent nature of most American cities, sticker shock does make a difference: After the 1970s oil embargo, oil consumption per person in the United States fell, and didn’t return to the same level for another 20 years.

Some of those changes can last. The energy crisis gave rise to federal fuel-economy standards that spurred gas-saving innovations in vehicle design, keeping consumption lower than it might have otherwise been even as driving recovered.

Over the past decade, studies have shown that gasoline prices affect consumption both when they are going up and when they are going down. According to one 2021 paper, drivers have become more responsive to high prices over time, potentially because of energy price shocks that have prompted them to try different forms of transportation.

One option that has become more available lately is battery power. Some popular models, like Toyota’s RAV4 and Camry, are now available only with hybrid engines.

According to Cox Automotive, hybrids have been flying off dealer lots since the war started. And even though Congress truncated Biden-era incentives for fully electric vehicles, enough of them are coming off subsidized leases to supply a healthy used market.

“We’ve seen a change in consideration,” said Stephanie Valdez Streaty, director of industry insights at Cox. “People who need to buy a car, they’re looking online at these options that are more fuel efficient.”

One of those motivated buyers was Karin Ranta-Curran, a university administrator in Denver, who had decided to buy a third car because her youngest son started needing to drive himself around more. The family had considered getting an electric vehicle, but held off because of the expense of installing a home charger.

The war in the Middle East changed that.

“We woke up that morning and Israel started bombing Iran, and we thought, ‘OK, this might be the time,’” said Ms. Ranta Curran, who found a good deal on a used electric Lexus and now drives it to work.

She’s happy with the car and not having to pay for gas, even if geopolitical circumstances made it necessary. “We’re certainly not early adopters, so this was a bit of a forced decision in some ways.”

That is not an option for most people. Vehicle prices have climbed steeply since the pandemic, interest rates remain high, and low-income workers are under pressure as wage growth slows. That’s leading consumers to hold off on big-ticket purchases, counteracting what might otherwise be a faster replacement cycle toward cleaner cars.

Even bicycle sales have declined substantially from last year, according to the National Bicycle Dealers Association. It attributes the slowdown to an unsteady economy and tariffs that drove prices higher, although e-bike sales continue to grow.

Baylii Adams-Yates is among those who feel stuck. She attends college in Morgantown, W.Va., and works as a dental assistant. She owns a 2016 Jeep that gets about 13 miles to the gallon, and doesn’t think she could sell it for enough to buy a more efficient car. But having a car that’s so expensive to drive also means she can’t take jobs that are a little farther out of town, or make extra income by doing deliveries.

“I tried doing DoorDash for the week, and I drained my gas tank within a day, every day,” said Ms. Adams-Yates, 25. “I would love to be able to do that, but it’s not realistic.”

Other countries, particularly in Europe and Asia, are more affected by petroleum shortages than the United States has been. They also have access to affordable electric vehicles imported from China, and have taken more policy measures to reduce energy demand. The U.S. Energy Information Administration forecast last week that global oil consumption would decrease this year, rather than increase, as it originally had expected.

For many U.S. consumers, there’s no way to cut back on gas, and they just have to reduce spending in other ways.

Take Kjersten Oudman, who runs a farm with her husband outside Sioux Falls, S.D. They have no choice but to fill their tractors with diesel to plant in the spring, and no choice but to deliver boxes of vegetables to 130 farm share members once they’ve started harvesting, filling the pickup truck with gas about three times a week. Unlike big logistics companies, they can’t tack on a fuel surcharge; the subscriptions are paid at a fixed price.

“We’re going to have to eat it for the foreseeable future,” Ms. Oudman said. Shelling out an extra few hundred dollars a month means tightly budgeting on groceries, which she tries to keep to $80 a week for her family of five, and postponing investments in the business. They were hoping to insulate their wash-and-pack building to store vegetables for longer, but the extra fuel costs pushed the project off.

“We got about halfway done and were like, ‘Well, I guess we’ll have to wait now,’” Ms. Oudman said.

It’s not just gasoline. Oil heating is still common in some parts of the United States, and the cost has jumped far more than natural gas or electricity since the war started.

Jennifer Kewley moved in 2020 into the house her great-grandfather built in Milwaukee, and replaced the roof and the siding. But it still has an oil heater, and filling it up costs about double what it did before the war.

In March and April, she set the heat at 55 degrees and bundled up while working from home doing medical billing for a hospital system. She filled up the tank only halfway, for $600, and is hoping the price will drop by the time she needs the heat again in October. Over the long term, she’s thinking about how she might cobble together the money to replace the old boiler.

“I think that this is a situation that could happen again,” Ms. Kewley said. “I don’t think this is a one-off, where I could just go another 20 years like this.”

Whether oil and gas demand recovers also depends on the price of everything else, since consumers have to balance rising costs for food, utilities, insurance and other necessities.

Judith Awkerman already made one compromise, giving up the dream of moving into a nicer house once her children were through college because home prices have jumped around where she lives near Newport, R.I. She has also given up frequent visits to her two sisters, who live in other parts of the state. She’s not sure she’ll return to those longer drives, even if gas prices recede.

“I don’t think it’ll be like, ‘Yay, we can do whatever we want,’ because it’s cumulative with everything,” she said. “Car repairs, medical expenses, medications — it would take a whole system downgrade, where inflation is way down, which of course we won’t have for a while, I don’t think.”

https://www.nytimes.com/2026/06/23/business/economy/gasoline-demand-destruction.html