President Carter moved yesterday to deprive the oil industry of $700,000 in revenues for every day that Congress fails to agree on a new oil profits tax.
The White House announced that a small category of oil that was due to be partly decontrolled on Jan. 1 will remain under a price lid until Congress delivers the tax on oil revenues to Carter's desk.
The action, which affects less than 1 percent of U.S. oil production, was designed as "a small reminder" to the industry that Carter wants an oil profits tax soon as his price for not flexing the authority he has to slow the process of removing all other price ceilings on oil, administration officials said.
After much dithering, House and Senate conferees this week agreed to arrange their differences on the tax bill so that the product, whenever it emerges, will bring in $227.3 billion over the next 10 years. But the Carter people made it plain that not just any old route to that number will do. Nor, they indicated, will Carter take kindly to much more procrastination in producing an agreement.
Press secretary Jody Powell said earlier this week that the tax structure should be "consistent with sound energy policy" in exempting only the oil producers that badly need financial incentives to keep going. Decisions on which producers get those incentives will occupy the conferees' time when Congress reconvenes next month.
Carter's action, to be formalized in an executive order within a few days, involves an indefinite delay in the scheduled Jan. 1 increase of $7 that would boost the price of oil from so-called "marginal" wells to $13 a barrel.
Such wells, scattered nationwide among major oil companies and smaller independents alike, tend to be older, deeper wells with small production that together account for about 500,000 barrels of oil per day. That is about 2 percent of all domestic output. The country consumes a million barrels of oil every 90 minutes.
Price controls were lifted June 1 on 80 percent of the marginal wells, so Carter's action affects only the 20 percent that were due to be decontrolled Jan. 1. About 100,000 barrels of oil per day are involved, not enough to have any noticeable impact on consumer prices, White House officials said.
Other decontrol measures will proceed as scheduled, Carter said in his statement. Current production of heavy crude oil was freed of price ceilings on Friday, an action Carter said should stimulate production of another 140 million barrels by 1986.
The president's price control authority expires in September 1981, by which time decontrol of most U.S. oil stocks should be in effect. About 60 percent of domestic output already is decontrolled.