President Donald Trump signed a presidential memorandum on Thursday determining that domestic petroleum production, refining, and logistics capacity are "industrial resources, materials, or critical technology items essential to the national defense," and invoking Section 303 of the Defense Production Act of 1950 to expand them.
The memorandum directs the Secretary of War to use the Section 303 authorities — including purchases, purchase commitments, and financial incentives — to create, maintain, and expand capacity across oil exploration, production, and refining, as well as gathering and transportation pipelines, storage, and marine terminals. Trump waived the standard requirements set out in Section 303(a)(1) through (6) for the capacity covered by the determination, and the memorandum states that it takes precedence over earlier memoranda, proclamations, and executive orders where they conflict. It names no specific project.
In the memorandum, Trump found that without presidential action, U.S. industry "cannot reasonably be expected to provide" the needed capacity "in a timely manner" because of "constrained financing, long lead times, permitting and infrastructure bottlenecks, and supply chain limitations." The determination builds on Executive Order 14156, "Declaring a National Energy Emergency," issued on January 20, 2025, and argues that petroleum fuels the nation's armed forces, industrial base, and critical infrastructure, so a shortfall would severely impair the national defense capability of the United States.
The memorandum is addressed to the Secretary of War, a shift from a determination bearing the same title that was issued on April 20, 2026, and addressed to the Secretary of Energy. Last week, Vice President JD Vance said the administration would use the Defense Production Act to expand the capacity of a Texas refinery owned by Delek US Holdings, and legislation Trump signed last year included $1 billion in Defense Production Act funding for energy-related projects deemed critical to national security.
The move comes as fuel prices surge. Brent crude closed around $113 a barrel on Thursday, its highest since early May, after reports that the United States and Israel have drawn up plans for renewed strikes on Iran after the midterms. Crude and diesel prices have climbed since the U.S. and Israel attacked Iran in joint action at the end of February, with the conflict limiting energy shipments globally and Ukrainian attacks on Russian refineries exacerbating fuel shortages. U.S. gasoline prices topped $4 a gallon in October for the first time on record — the national average for regular gasoline stood at $4.284 a gallon on October 19 — and diesel has been above $6, while U.S. gasoline inventories were 3.8% below the five-year average in the week ended October 9. The Energy Information Administration forecasts Brent will average $105 a barrel in the fourth quarter of 2026.
The United States is already the world's largest crude oil producer, averaging around 13.6 million barrels a day in 2025, but its operable refining capacity stood at 18.2 million barrels a day at the start of 2026, down by more than 250,000 barrels a day — about 1% — from the start of 2025. Analysts note that the determination does little to change the near-term oil balance, which is still driven by the Iran conflict, but that federal financial support for capacity could over time ease the tight diesel and gasoline margins that have pushed pump prices above what crude alone would imply.
Fuel costs have become a central issue twelve days before the November 3 midterm elections, which will decide control of Congress. A Reuters/Ipsos opinion poll that closed on Monday found that just 36% of Americans approve of Trump's handling of the economy, as his fellow Republicans try to maintain control of both chambers.