President Trump announced Thursday that his administration will use the Defense Production Act to allocate $150 million toward increasing gasoline and diesel production in the United States. The 1950 Korean War-era law permits the president to deploy loans, purchase commitments and other tools to incentivize production of critical materials and goods. The Department of Energy said the funding will boost U.S. refining output by millions of gallons per day and reduce fuel costs for Americans facing prices exceeding $4 a gallon on average over the last three months.
The move reflects broader White House efforts to tackle fuel prices as crude oil markets climb. Brent crude, the international benchmark, reached $116 a barrel on Friday, up 2.6%, while West Texas Intermediate, the U.S. standard, stood around $103 a barrel, up 3%, marking crude's highest level since May. At the pump, gasoline averaged $4.29 a gallon nationally and diesel $6.32 on Friday, according to AAA, representing increases of 40% and 74% respectively from a year earlier.
However, energy experts told CBS News the measure is unlikely to deliver meaningful price relief. Patrick De Haan, a petroleum expert at GasBuddy, said the approach will have little impact. The fundamental issue is that oil prices are set globally, where disruptions from the Iran war and Russia-Ukraine conflict have constrained supplies and pushed prices higher. The U.S. already produces more fuel than it consumes domestically: approximately 5.3 million barrels of distillate fuel oil per day against consumption of 3.6 million barrels, and 9.5 million barrels of gasoline per day against domestic demand of 8.9 million barrels.
Tom Kloza, chief energy adviser for Gulf Oil, told CBS News that adding capacity poses significant challenges because U.S. refineries operate at maximum utilization. He stated that "there is no slack in U.S. refining, so production can't be added regardless of political will." The American Fuel & Petrochemical Manufacturers, representing refiners, acknowledged the U.S. already produces more than it consumes and noted that refineries are operating at full capacity to supply Americans and global markets despite disruptions elsewhere.
Kloza added that bringing additional refining capacity online requires months or quarters. While the Defense Production Act could potentially accelerate some expansion or restart projects, it would not produce immediate benefits. For American households and businesses, this means fuel price relief remains unlikely in the near term despite the administration's efforts, as global market forces rather than domestic supply constraints are driving costs higher.