Trump Administration Weighs Using Defense Production Act to Expand US Refining Capacity
The White House is considering using the Defense Production Act to expand US oil refining capacity in response to global crude supply disruptions and price spikes.
The administration has been under pressure to contain the impact of surging fuel prices on consumers and businesses ahead of November's midterm elections, and expanding refining capacity is seen as a way to achieve this goal.
A recent meeting between President Donald Trump and nearly a dozen US refiners discussed how federal support could be used to add capacity. However, participants noted that making refineries more efficient or expanding existing plants would be more cost-effective than building new ones.
The Defense Production Act gives the president broad powers to direct industrial resources and provide financial incentives for companies to expand production of materials deemed important to national defense. The administration has already used the act to support and expand US petroleum production, refining, and logistics capacity.