U.S. President Donald Trump speaks to the media as he leaves the White House en route to South Carolina, in Washington, DC, United States, October 21, 2026.
Kevin Lamarque | Reuters
President Donald Trump determined Thursday that oil production, refining and related activities are essential to national defense, a decision that could pave the way for U.S. financing of fossil fuel projects.
In a presidential memo, Trump also invoked part of the Cold War-era Defense Production Act, allowing him to offer financial incentives for activities related to oil, pipelines and liquid fuel storage.
Crude oil and diesel prices have soared since the United States and Israel attacked Iran in a joint action in late February. Since then, the conflict has limited energy shipments globally, with Ukrainian attacks on Russian refineries exacerbating fuel shortages.
Rising costs pose a risk to Trump in the Nov. 3 election, as his fellow Republicans try to maintain control of both houses of Congress. The Reuters/Ipsos opinion poll closed Monday shows that only 36% of Americans approve of Trump’s handling of the economy.
The memo states that without taking action, the United States will not be able to provide enough of these energy services “in a timely manner due to limited funding, long delivery times, permitting and infrastructure bottlenecks, and supply chain limitations.”
The memo does not mention specific projects that could be funded. The United States produced an average of about 13.6 million barrels of crude per day in 2025, making it the largest crude producer in the world.
Last week, Vice President JD Vance said the administration would use the Defense Production Act to increase capacity at a Texas refinery owned by Delek US Holdings.
Trump signed legislation last year providing $1 billion in funding under the Defense Production Act for energy-related projects deemed critical to national security.
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