Trump Uses Cold War Law to Fund Oil
A memorandum dated October 22, 2026 declares oil production, refining, and logistics “essential to national defense” and invokes Section 303 of the Defense Production Act of 1950 to authorize purchases and financial support from the Department of War. It names no project and comes out 12 days before the midterm elections, with diesel prices high since the attack on Iran.
The memorandum is one page long and was signed on October 22, 2026. Addressed to the “Secretary of War,” it determines that oil production, refining, and logistics capacity in the United States — “including exploration and production, gathering and transmission pipelines, storage, and marine terminals” — are “industrial resources, materials, or critical technology items essential to national defense.” The department receiving the order is the one a September 5, 2025 executive order renamed the Department of War, with the same head and the same budget as the former Department of Defense.
The centerpiece of the text published by the White House comes two paragraphs later. Trump invokes Section 303 of the Defense Production Act of 1950 to conclude that, without presidential action, the U.S. industry cannot reasonably be expected to deliver these capabilities “in a timely manner,” citing “constrained financing, long lead times, licensing and infrastructure bottlenecks, and supply chain limitations.” He then waives the requirements of the law itself and authorizes the Department of War to make purchases, enter into purchase commitments, and issue financial instruments to enable the projects. The legal basis for the emergency is the executive order of January 20, 2025 that declared a national energy emergency.
A War Law as Industrial Policy
The Defense Production Act was written in 1950 to mobilize U.S. industry for a conflict. In recent decades, it was used to procure steel, aluminum, and defense components. Since April 2026, it has become a channel for energy policy: on April 20, the White House signed equivalent determinations covering coal and baseload generation, the power grid, natural gas, and large-scale energy infrastructure. The October determination repeats the format for oil, and the administration already has funds under the law approved for energy projects deemed critical. The previous week, Vice President Vance said the mechanism would be used to expand the capacity of a Delek U.S. Holdings refinery in Texas.
What the memorandum does not do is name a project. There is no list of works, pipelines, or terminals to be financed; the authorization is for the capacity to spend. The memorandum states that industry cannot reasonably deliver these capabilities in a timely manner without federal support.
Why Now
Oil and diesel prices have risen since the United States and Israel attacked Iran in a joint action in late February 2026, and the conflict has restricted energy shipments worldwide, with Ukrainian strikes on Russian refineries worsening the fuel shortage. The signing comes 12 days before the November 3, 2026 midterm elections, when the price at the pump has become an electoral risk for a president trying to keep both houses of Congress. The Reuters/Ipsos poll, completed on October 19, 2026, gave Trump 36% approval for his handling of the economy.
The presidential determination identifies a narrower scarcity than that of oil: the scarcity of cheap oil.
The presidential determination identifies a narrower scarcity than that of oil: the scarcity of cheap oil. The move converts price into a security premise. In doing so, the energy emergency declared in January 2025 — before the war — becomes the explanation for why the country needs to subsidize the most profitable sector of its economy, and the war that made fuel more expensive becomes the justification for the money that tries to make it cheaper.
What Remains Committed
The October 22 signing turns a war into industrial policy and leaves the bill for after the vote. Whoever wins in November 2026 inherits purchase commitments and financial instruments signed 12 days before the election, with the advantage that the memorandum does not say where the money will go: the commitment is to the possibility of spending, and the announcement of projects is left for after the vote.