Trump Announces First New U.S. Oil Refinery in 50 Years, Backed by India’s Reliance Industries

TLDR

• President Trump announced the U.S. will build its first new oil refinery in 50 years in Brownsville, Texas
• India’s Reliance Industries is the backer, in a deal Trump called a “$300 billion” investment
• The refinery will process 168,000 barrels per day of U.S. shale oil, with groundbreaking planned for Q2 2026
• Reliance has signed a binding 20-year deal to buy the refinery’s output
• Industry analysts are skeptical, questioning demand and the need for a new Gulf Coast refinery

President Donald Trump announced Tuesday that America First Refining will build a new oil refinery in Brownsville, Texas — the first new refinery in the United States in 50 years. The project is backed by India’s Reliance Industries, run by billionaire Mukesh Ambani.

Trump called it a “historic $300 billion dollar deal — the biggest in U.S. history” on his Truth Social platform.

The refinery will have a capacity of 168,000 barrels per day and is designed specifically to process light, sweet shale oil produced in the U.S. America First Refining says construction could begin as early as the second quarter of 2026.

Reliance Industries has provided a nine-figure investment at a ten-figure valuation, though exact numbers were not disclosed beyond Trump naming Reliance publicly. The company has also signed a binding 20-year offtake agreement, meaning it will purchase the products the refinery produces.

Trump said the deal will offset $300 billion in the trade deficit with India. Reducing trade imbalances has been a recurring focus for his administration.

The Brownsville location sits on the southern U.S. border at a port. Analysts say its remote location raises questions about distribution.

Why Analysts Are Skeptical

Industry experts are questioning the need for the project. The Gulf Coast already houses eight of the ten largest refineries in the country.

The cost of building a refinery has averaged around $40,000 per barrel of capacity in recent years, putting the price tag for this project at roughly $6.7 billion.

Reliance’s Role

Reliance Industries operates the world’s largest refining complex in Jamnagar, India, with a capacity of 1.4 million barrels per day. The company reported $125 billion in revenue last year and also operates businesses in retail, digital services, and entertainment.

Reliance did not respond to a request for comment from Reuters.

Context and Recent Developments

The announcement comes as U.S. gasoline prices have risen since the start of the U.S.-Israeli conflict with Iran. Two California refineries with a combined capacity of 284,000 barrels per day have permanently closed since late 2025, citing state regulations on fossil fuels.

America First Refining says the project will produce 50 billion gallons of refined products worth an estimated $175 billion, and process 1.2 billion barrels of U.S. shale oil worth $125 billion over the refinery’s life.

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