Trump Administration at Work to Offset Higher Commodity Prices

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Written by Daniel Graeber for IIR News Intelligence (Sugar Land, Texas)

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Summary

The Conference Board's gauge of consumer confidence for September was bruised by runaway crude oil prices. The Trump administration says it aims to offset that by tapping strategic reserves.

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U.S. Leads on Supply-Side Issues, Energy Secretary Says

With commodity prices squeezing the U.S. consumer, the federal government said it was leaning on an already-depleted strategic reserve to stabilize markets as confidence in the world's largest economy fades.

Brent crude oil prices continue to hover near $100 per barrel as tensions percolate in the Middle East. On Wednesday, the United Kingdom Maritime Trade Operations Center reported a crude oil tanker was struck by unknown projectiles while moving through the Strait of Hormuz, highlighting the ongoing risks to an artery that carried about 20% of the global deliveries of crude oil and liquefied natural gas (LNG) before fighting began in late February.

U.S. President Donald Trump has mulled a variety of ways to offset runaway commodity prices. In September, the administration considered using the Defense Production Act from 1950 to boost refinery throughput. Enacted in response to the Korean War, the measure gives the president a wide berth in working to strengthen the production of goods for the sake of national security.

Refineries, however, were running near peak capacity during the summer, but more recently have started to defer maintenance that would normally coincide with the shift from the summer blend to the winter blend of gasoline. According to Industrial Info Resources data, planned outages this fall season are about 140,000 barrels per day (bpd) lower than pre-war expectations.

For more information, subscribers to IIR Energy's Breaking Energy News (BEN) can view the September 16, 2026, article - Some U.S. Refiners Deferring Maintenance from 2026 to 2027.

Still, the administration is fretting over the economy, amid declining poll numbers and early signs that Democrats will take control of both chambers of the U.S. Congress in the November elections.

On Tuesday, the U.S. Department of Energy issued a request to exchange up to 40 million barrels of crude oil from the Strategic Petroleum Reserve (SPR), its last such request under agreements with members of the International Energy Agency (IEA).

"With today's actions, the United States continues to lead the coordinated efforts to stabilize oil markets for the benefit of Americans and people around the world," U.S. Secretary of Energy Chris Wright said.

The exchange is meant to put barrels into the market before the end of the year, with the aim of ensuring the SPR inventory is ample over the long term. The SPR, created to offset supply-side shocks, is well below half its capacity because of earlier releases. The IEA had called on member states to tap their reserves to offset war-related supply disruptions.

By the Numbers

• 7-point drop in consumer confidence due to oil and gas prices
• 40 million barrels SPR exchange sought by U.S. government

Did Saudi Arabia Come Through with Relief?

Markets are getting a bit of relief from overseas, though tensions remain high in the Middle East. Industrial Info Resources is tracking the status of the East-West crude oil pipeline in Saudi Arabia, which is being touted as something of a relief valve for the conflict as it avoids the Strait of Hormuz by running across the Saudi peninsula to the Red Sea.

Sabotage in September, however, led to reduced activity and lower loadings from the Red Sea port of Yanbu amid an uptick in attacks from the Iranian-backed Houthi rebel group in Yemen. The East-West crude oil pipeline is a 745-mile network designed with a peak capacity of 7 million bpd.

Industrial Info Resources offers more information on the East-West pipeline in its Global Market Intelligence (GMI) Pipeline Database, where readers can find details in a pipeline profile.

While updates to second-quarter gross domestic product were stronger than expected, the U.S. consumer is increasingly pessimistic, with the Consumer Confidence Index from The Conference Board falling nearly 7 points from August.

"References to prices, the high cost of goods and services, and oil and gas prices in particular, rose to new heights, reflecting September's surge in fuel costs," said Dana M. Peterson, the chief economist at The Conference Board.

Key Takeaways

• The U.S. president is working in earnest to tackle higher crude oil prices
• Saudi crude oil pipeline flows returning, but slowly

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About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news, and analysis on the industrial process, manufacturing, and energy-related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified, and verified plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 trillion (USD).