White House Weighs Using Defense Production Act To Expand Oil Refining, Report Says

The White House is weighing how to use the Defense Production Act to expand U.S. oil refining capacity, Reuters reported Friday.

American refineries ran at 97.8% of capacity in the week ending Sept. 4, according to the Energy Information Administration. Refining executives told administration officials at a recent meeting that federal money should go to making existing plants more efficient or expanding them rather than to a new refinery, two anonymous sources familiar with the administration’s plans told Reuters.

No final decisions were made, and the 1950 law has never been used to add refining capacity, the outlet reported. A new plant would cost far more and take years to complete, the anonymous sources told the outlet.

Diesel averaged $6.06 a gallon Friday, the first time the national average has topped $6, up from $5.85 on Sept. 4 and $3.71 a year ago, according to AAA. Regular gasoline stood at $4.29.

President Donald Trump said Wednesday that oil prices will not come down before the November midterm elections.

“Right after the election, oil prices are going to be tumbling downward,” he told reporters at Joint Base Andrews.

“America’s refining capacity is essential to ensuring the United States has continuous access to secure, affordable, and reliable energy,” White House spokeswoman Taylor Rogers told the Daily Caller News Foundation in a statement. “Expanding that capacity is a top priority for the President and his energy team, who are evaluating concrete options to increase our refining capacity through regulatory reform, faster permitting, and additional investment.”

Trump met with nearly a dozen refiners at the White House on Sept. 1.

America First Refining did not immediately respond to the DCNF’s request for comment.

The act lets the president direct industrial resources and offer financial incentives for materials deemed important to national defense. Trump determined on April 20 that domestic petroleum production, refining and logistics capacity are essential to national defense, according to a memorandum to the energy secretary.

Iran has blockaded the Strait of Hormuz since the war began Feb. 28. The strait carried about a fifth of global oil and petroleum product consumption in 2024 and early 2025, according to the Energy Information Administration.

A proposed refinery at the Port of Brownsville, Texas, has emerged as a test of the push, though Reuters said it was unclear whether the project would receive any funding under the act. America First Refining plans a 168,000-barrel-per-day plant that Trump announced in March, according to the Port of Brownsville, which called it the first new Gulf Coast refinery in nearly 50 years.

Donald Trump Jr. holds a stake in America First Refining, ProPublica reported in June, and a spokesperson told the outlet he is “simply a passive minority investor” with no operational role. Cantor Fitzgerald, which Commerce Secretary Howard Lutnick led before joining the administration, is serving as the company’s financial adviser, according to company announcements cited by Reuters.

The administration is also pushing to open more foreign supply. The Pentagon’s Office of Strategic Capital holds a 35% stake in North American Blue Energy Partners, a Venezuelan company granted rights to 17 oil fields, and the White House says that production will eventually be processed through U.S. refineries, Reuters reported.