US Weighs Defense Production Act to Expand Domestic Refining Capacity

The United States is considering using the Defense Production Act to increase domestic refining capacity. The plan was discussed during a recent meeting between President Trump and senior executives of US refining companies, at which US government officials asked how federal support could most effectively be used to raise refining capacity. Refiners said federal funds would be best spent on improving the efficiency of existing refineries or expanding existing plants, rather than on building new refineries, which are far more costly and take years to complete. The ongoing conflict between the United States and Iran has left global crude oil supplies facing disruption and sharp price increases. The United States will hold midterm elections in November. The United States is considering this unconventional measure. The Defense Production Act has never before been used to increase refining capacity. The law gives President Trump broad powers to direct industrial resources and provide financial incentives to companies to expand production of materials critical to national defense.