The oil industry is lobbying hard for special tariff legislation that - in the name of "national security" - would protect U.S. refiners' profit margins, and probably raise consumer prices.
If enacted, this latest piece of protectionism would broaden the President's authoriy to raise the tariff on imported heating oil, gasoline and other refined petroleum products.
The tariff authority is contained in an obscure amendment to the Senate energy tax bill, now conference. It was offered by Sen. Floyd K. Haskell (D-Colo.). Oilmen from more than 20 companies, including Phillips, Union, Getty and Pennzoil, are behind it.
The rationale is the same as for most other protectionist legislation. "Foreign refiners presently enjoy substantial cost advantages over domestic refiners," Haskell says.
The explanations that oilmen give for these foreign cost advantages are also the same as given in other such cases: tax subsidies for refiners in foreign countries, lower anti-pollution standards abroad, lower labor costs and so on.
Currently, this foreign advantage is offset by the price controls the federal government maintains on domestic crude oil, and the so-called entitlements program a complicated merchanism that serves to equalize the price that most U.S. refiners must pay for crude.
But President Carter's energy plan now pending in conference would do away with this protective pricing system; it would essentially force all U.S. refiners to pay about the same world price for crude oil that foreign refiners do.
So the domestic refiners are pushing the Haskell amendment, to keep from losing ground.
The United States now imports about 2.1 million barrels of refined petroleum products a day. That is only a relatively small percentage of total U.S. consumption, but it is still up 12 per cent from last year's import total, and an unpublished Energy Department study says that this total will double to more than 4 million barrels a day the early 1960s.
These imports are of special importance to new England, which buys the great part of its home heating oil from foreign refineries.
During Senate debate on the Haskell amendment, Sen. Thomas McIntyre (D-N.H.) rose in opposition. "It is unfair or require some users of petroleum products to bear the brunt of a shortage of domestic refinery capacity, a shortage for which the industry itself if responsible," McIntyre said.
Other New Englanders also are fearful the tariff provision would mean higher prices for their constituents.
Chairman Russell B. Long (D-La.) of the Senate Finance Committee said on the floor he would work in conference for some means of reducing the impact the Haskell proposal might have on particular parts of the country.
The existing tariff on imported petroleum products is 1.5 cents a gallon. The President now has authority to raise that under certain circumstances. The Haskell amendment merely provides the President with new bases for using the authority.
The most important of these has to do with national security. The President already has authority to raise the tariff if he feels the national security requires that step; the Haskell amendment in effect redefines national security to make it easier to justify tariff increases under that provision.
No one knows how much the tariff - and prices - might rise under the Haskell amendment. But the industry estimates that the entitlements program and pricing regulations save U.S. refiners - and presumably consumers as well - about 6 cents a gallon.
The administration has said it does not think the Haskell amendment is needed but did not fight it hard in the Senate.
There is one other way in which Haskell's protectionist legislation for oil is like other protectionist steps that have been taken this year. It is backed by labor as well as business. The Oil, Chemical and Atomic Workers union, which is based in Haskell's home state, backed the legislation just as did the companies.