30/10/2026 by Joel Thompson
Through a presidential memo, the US government has invoked an element of cold-war legislation to regard petroleum-related activities as being vital to national defence.
The Defense Production Act was passed in 1950 to enable the US federal government to reinforce national defence by intervening in the private sector. It was first used during the Korean War to increase domestic materials like titanium and aluminium that were seen as essential for the war effort. It was also invoked during the COVID-19 pandemic to support production of vaccines and other medications.
By invoking Section 303 of the act, the government has classified producing and refining petroleum products as essential activities for national defence. It can now initiate interventions like providing equipment or financial support, making purchases or committing to make them and taking other measures to enhance production. For example, US oil companies like Chevron and ExxonMobil, which make the Texaco and Mobil lubricant and grease ranges, could receive support to progress otherwise uneconomical projects. The memo argues that:
“…without Presidential action under section 303 of the Act, United States industry cannot reasonably be expected to provide these capabilities for the needed industrial resource, material, or critical technology item in a timely manner due to constrained financing, long lead times, permitting and infrastructure bottlenecks, and supply chain limitations…”
The memo does not go into detail about which particular projects could be supported. Vice President J.D. Vance recently said, however, that the act could be used to increase the capacity of a Texas refinery.
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