Trump invokes Section 303 to support oil production and refining, tasks secretary of war with implementation
Key Facts
U.S. President Donald Trump invoked Section 303 of the Defense Production Act to support petroleum production, refining and related logistics capacity, according to a memorandum published by the White House in October. He addressed the memorandum to the secretary of war, directing him to implement the decision using the necessary purchases, commitments and financial instruments. The decision includes a waiver of statutory requirements to expand oil capacity on national defense grounds. The White House justified the waiver by citing the need to avert a shortfall "that would severely impair national defense capability." The decision places support for production, refining and logistics within the scope of federal intervention aimed at securing that capacity.
The presidential memorandum listed financing and implementation hurdles facing the expansion of oil capacity, presenting them as reasons for federal intervention. It identified "financing constraints" among the obstacles to developing that capacity, alongside long implementation timelines. It listed permitting bottlenecks among the factors hampering expansion, as well as related infrastructure bottlenecks. It also cited supply chain constraints as part of the difficulties facing the sector. Under the White House's rationale, financing needs thus overlap with permitting and infrastructure requirements and supply availability in carrying out capacity expansion projects.
The October memorandum was preceded by an official text published by the White House in April addressing support for petroleum production, refining and related logistics capacity. Its scope includes exploration and production, as well as oil gathering and transmission pipelines, according to the official text. It also extends to storage facilities and marine terminals, encompassing multiple stages of petroleum production, transportation and storage. The text authorizes purchases and purchase commitments to support the development of production capacity. It also provides for financial assistance for that development among the support tools available under the law. The text combines purchases of output, commitments to purchase it and financial contributions to developing the necessary capacity.
The move comes as total U.S. refinery output reached its highest level since 2019, according to the U.S. Energy Information Administration. U.S. refining capacity, meanwhile, has fallen 4% since that year, according to the agency, which linked the output level to the decline in capacity. Refinery utilization averaged more than 95% from May to September of the year covered by the report. The agency said the utilization rate was the highest for those months since 1998. The historical comparison places high utilization in the context of lower refining capacity than in 2019, with output reaching its highest level since that benchmark year.
The use of national security support tools extends to other energy sector projects, according to U.S. Department of Energy announcements in October 2026. The department said the Working Families Tax Cut Act allocated 1 billion dollars to energy projects deemed vital to national security. In an announcement concerning a specific project, the department unveiled funding of up to 42 million dollars to advance the development of a natural gas pipeline. The project, known as the Constitution Pipeline, links Pennsylvania and New York. The department said the funding would be provided using Title III appropriations under the Defense Production Act, applying the law's tools to energy transportation infrastructure.
In the refining sector, Vice President JD Vance announced the use of the Defense Production Act to expand Delek's refinery in Tyler, Texas, according to Reuters. Vance said: "We're going to expand the refinery here in Tyler, Texas." The agency linked the move to White House efforts to ease fuel prices ahead of the midterm elections, after affordability became a key issue for voters. But refinery expansions require heavy capital spending, according to Reuters' report on the project. Such expansions can take many months or years to complete, depending on the complexity of the additions required. Congressional elections take place on November 3 and will determine which party controls Congress, bringing the approaching electoral milestone against a backdrop of the long implementation timelines associated with refining projects.