Interesting developments for Sable Offshore / $SOC

Brief Introduction

The Trump Administration has just ordered SOC to begin pumping oil for sale immediately, which abruptly clears the roadblock they had been waiting on to begin their first sales.  They have a 55K BPD pumping capacity and 540,000 Barrels already ready for sale.

The Order

• The Trump administration on Friday directed Sable Offshore to restart its operations of the Santa Ynez Unit and Santa Ynez Pipeline System off the coast of California, which comes as oil and gas prices surge as a result of Iran’s closure of the Strait of Hormuz.
• Energy Secretary Chris Wright’s order for oil production, which followed an executive order signed by President Trump on Friday, intends to “address supply disruption risks caused by California policies that have left the region and U.S. military forces dependent on foreign oil”
• https://www.whitehouse.gov/presidential-actions/2026/03/adjusting-certain-delegations-under-the-defense-production-act/ 
• Nearly every major news outlet has covered this over the weekend

The reason for order

• More than 60 percent of the oil refined in California comes from overseas, with a significant share traveling through the Strait of Hormuz—presenting serious national security threat
• The action intends to “reduce California’s reliance on foreign oil vulnerable to geopolitical disruption” 
• Offering US oil serves two purposes: Significantly reducing costs of transport/import, and, providing a stable source that isn’t vulnerable to world market issues
• “Today’s order will strengthen America’s oil supply and restore a pipeline system vital to our national security and defense, ensuring that West Coast military installations have the reliable energy critical to military readiness” – Energy Secretary Chris Wright

The company says pumping for sale will begin immediately, March 14th (Saturday)

• Following the order, Sable officially notified the Santa Barbara County Fire Chief on Friday, shortly after the order, that it will begin transporting oil within 24 hours. https://www.newspress.com/2026/03/14/president-trump-orders-sable-offshore-to-restart-transporting-oil/ 

Sable had already filled their storage tanks with oil ready to sell, but they were not allowed to sell it until now 

• The company already filled their 540,000 barrels of storage capacity at the Las Flores Canyon facility where the crude is held.  
• The tanks have been filled and ready to sell via pipe transport since mid 2025, but transport through the pipes for sale was held up by legal uncertainty, hence the drop in stock price.
• At a modest $75 per barrel, a full storage tank facility represents roughly $40.5M worth of immediate sales 

Sable's Oil pumping capacity

• SOC already has the infrastructure in place to pump the oil, it just needs to be turned back on
• SOC can currently pump 55k barrels/day according to the company and the government press releases
• 55,000 × 365 = ~20.1 million barrels/year

An interesting Short Interest situation

• An interesting situation exists with the short interest.  Short sellers grew the total shares shorted to 33.9 million shares by February 2026. This represents an estimated 46% of the tradable float.
• A large volume of the shorting happened at the lows of the yearly chart, meaning many short sellers are currently at a losing position as of Friday, March 13th 2026
• Short sellers were betting on a prolonged process for oil sales approvals, but this roadblock was removed overnight.  This is likely to cause the need to cover the short positions imminently before the price rises further due to the short seller’s hope being removed suddenly. 

The government now has authority to support Sable financially and otherwise through this DPA order

• The Defense Production Act of 1950 (DPA) gives the U.S. government broad powers to prioritize, fund, and accelerate production of materials considered critical for national defense.  This was used in multiple ways during the COVID pandemic to support companies.
• Under Title I of the DPA, the government can require suppliers to prioritize contracts for SOC if the project is deemed important for national energy security. (e.g. Prioritized delivery of offshore drilling equipment, faster access to pipeline repair materials, priority for transportation and refining capacity, etc)
• Under Title III of the DPA, the government can provide loans, loan guarantees, or direct investment to increase domestic production. (e.g. Funding to repair or upgrade the Las Flores pipeline system, loans to restart and expand offshore platforms, financing any infrastructure needed to reach or exceed the 55k barrels per day capacity)
• The government could agree to purchase oil output under DPA authority (e.g. buy for the Strategic Petroleum Reserve, or buy for military fuel needs)
• The DPA allows the government to speed regulatory issues (e.g. accelerated environmental reviews or approvals for any needed repairs that arise) 

Why this all likely matters

• The company’s stock was previously in limbo while awaiting legal approvals to begin sales
• As the wait for approvals continued, the price dropped because there was not a guarantee of a date the legal issues would resolve
• With sales beginning immediately (see above) and the existing roadblock removed overnight, the valuation changes completely.  The company’s entire existence is based on oil sales, which have not been able to occur.  Now that they will be occurring for the foreseeable future, the enterprise value will dramatically increase. 
• Now that oil pumping for sale has commenced, it requires a stock repricing to the upside to represent the typical revenue valuation multiples that are used for active oil companies.

A few additional considerations 

1. The high profile nature of the new directive for SOC provides a broad investor audience 
2. Multiple governmental organizations are mentioning $SOC by name (Including the President, the Secretary, the US Oil & Gas Association, and others).  https://x.com/US_OGA/status/2032816321713570287?s=20 
3. There is no other domestic oil company being named, rather, $SOC is the only one being designated as essential for the United States’ national interest under the DPA authority.
4. The 36%+ short interest must be covered (see above)

*Disclosure – This is not financial advice.  It is intended to be a summary of the recent developments over the weekend of March 14-15.  I am long in a position for SOC currently.