Trump Invokes Defense Production Act, Puts Up to $150 Million Toward Refining as Diesel Tops $6
President Donald Trump has invoked the Defense Production Act to steer up to $150 million toward expanding U.S. refining capacity as diesel prices climb past $6 a gallon.
“In more breaking news, my administration is using the Defense Production Act to release $150 million to increase American refining capacity to produce more diesel and gasoline at record levels,” Trump said at a Thursday rally in Sioux City, Iowa, according to Radio Iowa.
The presidential determination, issued under Section 303 of the 1950 law, declares domestic petroleum production, refining and logistics capacity essential to national defense. It ties the action to the national energy emergency Trump declared in January 2025 under Executive Order 14156.
The Department of Energy said the Title III money will expand petroleum production, storage and logistics at refineries across the country. The department said the funding is expected to raise U.S. refining output by millions of gallons per day.
The money comes from $1 billion that Congress already appropriated for energy projects deemed critical to national security, according to the department. DOE said the selection of projects is ongoing and recipients will be announced in the near future.
“These Defense Production Act funds will be used strategically and in partnership with private industry to rapidly bolster America’s existing energy infrastructure,” Energy Secretary Chris Wright said in a statement.
Wright blamed the closure of refineries on “17 years of Democrat leaders enacting energy subtraction policies,” and said the administration would soon have the country “producing more refined products as well.”
Pressure at the Pump and on the Farm
Fuel costs have become a central midterm issue. The average price of on-highway diesel rose to $6.28 a gallon Monday, up $2.66 from a year earlier, UPI reported, citing the Energy Information Administration.
Farmers have been hit especially hard during harvest season. The Washington Examiner reported that the wars involving Iran and between Russia and Ukraine have pushed diesel prices higher, while tariffs have raised fertilizer costs.
At a Kansas rally Monday, Trump unveiled an $8 billion Harvest Fuel Relief program to help farmers offset diesel costs, and he said Thursday it would deliver about $400 million in refunds in Iowa alone.
Earlier this month the administration eased restrictions on dyed diesel and directed the Treasury to defer the federal excise tax normally owed when it is used on highways, UPI reported. It also authorized certain Russian diesel transactions through April 7.
How the $150 million will be divided among refiners has not been announced, and it is not yet clear how quickly any new capacity could come online or reach consumers at the pump.
Trump told the crowd he expected relief to come from abroad as well. “We’re going to have Iran finished one way or the other,” he said, adding that “your gasoline prices and your oil is going to come tumbling down.”
The president used the rally to boost Rep. Ashley Hinson, who is running to replace retiring Sen. Joni Ernst against Democrat Josh Turek. Trump said electing Hinson would help secure year-round sales of E-15 ethanol blends, the Examiner reported.
Hinson told the crowd that Turek is “too liberal for Iowa.” Trump is scheduled to return to the state for a Nov. 1 rally in Dubuque.
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