Trump invokes Cold War-era Defense Production Act for oil production, refining

By Reuters News

WASHINGTON, Oct 22 (Reuters) - US President Donald Trump determined on Thursday that petroleum production, refining, and related activities are essential to national defense, a move that could open up US funding for fossil fuel projects.

In a presidential memo, Trump also invoked part of the Cold War-era Defense Production Act, allowing him to provide financial incentives for oil-related activities, pipelines and storage of liquid fuels.

Prices for crude oil and diesel have surged since the US and Israel attacked Iran in joint action at the end of February. Since then, the conflict has limited energy shipments globally, with Ukrainian attacks on Russian refineries exacerbating the fuel shortages.

The surge in costs poses a risk for Trump in the November 3 elections, as his fellow Republicans try to maintain control of both chambers of Congress. The Reuters/Ipsos opinion poll that closed Monday shows just 36% of Americans approve of Trump's handling of the economy.

The memo said that without taking the actions, the US is not able to provide enough of those energy services in a "timely manner due to constrained financing, long lead times, permitting and infrastructure bottlenecks, and supply chain limitations."

The memo did not mention specific projects that could be funded. The US averaged around 13.6 million barrels of daily crude production in 2025, making it the largest crude producer worldwide.

Last ‌week, Vice President JD Vance said the administration would use the Defense Production Act to expand capacity of a Texas refinery owned by Delek US Holdings DK.N

Trump signed legislation last year that included $1 billion in Defense Production Act funding for energy-related projects deemed critical to national security.

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