Trump invokes Section 303 to support oil production and refining, tasks secretary of war with implementation
Key Facts
U.S. President Donald Trump issued a memorandum invoking Section 303 of the Defense Production Act to support domestic oil production, refining and logistics capacity, according to the directive published by the White House on October 22, 2026. Trump addressed the memorandum to the secretary of war, tasking him with implementing the directive and using the necessary intervention tools to develop this capacity. The memorandum authorizes purchases, purchase commitments and financial support instruments to expand the domestic oil production base. The intervention is based on the designation of this capacity as essential to national defense and the need to avert a shortfall that would impair U.S. defense capabilities. Citing the emergency, Trump waived the requirements of paragraphs 1 through 6 of Section 303 for the expansion of capacity covered by the directive. The directive thus combines access to purchasing and financial support tools with exemptions from specified legal requirements for expanding oil capacity.
The memorandum covers exploration and production, as well as refining and oil-related logistics, according to the White House. Covered activities include oil gathering and transportation pipelines, as well as storage facilities and marine terminals. The administration attributes the need for intervention to financing constraints and long project lead times, both obstacles cited in the memorandum to justify support for developing domestic capacity. The memorandum also cited "permitting and infrastructure bottlenecks" among the reasons for intervention, alongside supply chain constraints. This scope brings oil handling, storage and transportation facilities under the directive, alongside extraction and refining facilities.
The move follows an earlier directive Trump issued on the same oil capacity on April 20, 2026, according to a memorandum published by the White House at the time. The April memorandum was addressed to the secretary of energy, while the new directive assigns implementation to the secretary of war. U.S. operable refining capacity stood at 18.2 million barrels per day on January 1, 2026, according to the U.S. Energy Information Administration. That was down by more than 250,000 barrels per day from the start of 2025. The decline represents about 1% of operable capacity, according to the agency, putting the government action in the wake of an annual decline in U.S. refineries' crude processing capacity.
In the fuel market, Energy Information Administration data showed the average U.S. regular gasoline price fell to $4.284 per gallon on October 19, 2026. The average had stood at $4.331 per gallon on October 12, putting the latest weekly reading below the previous week's level. On supplies, the Environmental Protection Agency said total U.S. motor gasoline inventories remained below the usual level for this time of year. The agency cited the weekly inventory report for the week ended October 9, 2026, which showed stocks 3.8% below the 5-year average. The weekly decline in gasoline prices thus coincides with inventories remaining below their seasonal average as the administration seeks to develop domestic production and refining capacity.
Among the projects announced by the administration, Vice President JD Vance said it would use the Defense Production Act to expand Delek's refinery in Tyler, Texas, according to Reuters. The refinery was processing about 74,000 barrels per day when the expansion project was announced. The news agency quoted refining executives as favoring government funding for efficiency improvements or expansions at existing refineries. They attributed that preference to the higher cost and years required to build a new refinery compared with upgrading operating facilities. Even so, refinery expansions typically take many months and can stretch into years depending on the complexity of the additions, according to Reuters. In its October outlook, the Energy Information Administration forecast Brent crude would average $105 per barrel in the fourth quarter of 2026. The agency thereby raised its estimate for the quarter by $14 per barrel from its forecast issued the previous month.