July 20, 1973
Page 25148
THE GASOLINE SHORTAGE
Mr. MUSKIE. Mr. President, Tuesday's edition of the Portland, Maine, Press Herald contains the results of the most recent survey conducted by the American Automobile Association which indicates that the effects of the gasoline shortage in Maine and the other New England States seem to be easing. In recent days, I have confirmed this impression through conversations with the Maine Innkeepers Association and the Maine Petroleum Association.
This is heartening news, particularly for a State such as Maine which attracts thousands of tourists each week during the summer months. Vacationers need have no concern that they will not be able to purchase as much gasoline as they desire in New England.
Nevertheless, while an improvement in the gasoline supply situation is indeed comforting to Maine consumers, this fact should not be interpreted as eliminating the need for prompt action by Federal authorities to adopt a more effective policy for equitably distributing petroleum products to wholesalers and retailers throughout the country.
The voluntary allocation program which has been in effect for the past 2 months is inadequate and there is ample evidence that it should be replaced with a mandatory program as soon as practicable.
Mr. President, I would like to cite but three reasons which support this conclusion.
First, the Maine congressional delegation initiated a meeting on June 28 in the Maine Office of Civil Defense with Federal, State, and local officials for the purpose of reviewing our State's experience with the voluntary allocation program. At this meeting, it was made absolutely clear that the voluntary guidelines for serving priority customers such as farmers, fishermen, public safety agencies, et cetera were not being implemented. This is largely because of the failure of the major oil companies to issue any instructions whatsoever to Maine's dealers concerning priority allocations.
Consequently, priority customers are being denied needed products, thereby necessitating formal complaints to State and Federal officials. State officials in particular are frustrated by the fact that representatives of the major oil companies operating in Maine responded to inquiries by stating that they could make no decisions on supply allocations at a State level and that any action would have to be initiated by their "home offices." Federal officials, in turn, are hampered by a lack of manpower and the lack of enforcement powers.
Subsequent to this meeting, I have received letters and reports from individual constituents providing further evidence that local distributors in Maine have received no instructions concerning priority allocations. This is causing a particular hardship for farmers who need prompt action on supply requests if they are to harvest their crops.
Second, looking ahead, to next winter's heating oil demand, Maine's fuel oil dealers have still received no firm assurances as to the level of supply they will be permitted to purchase in the coming months. This uncertainty, coupled with the difficulty experienced by State officials in obtaining supply commitment information voluntarily from oil companies, is not a good sign for the future.
Moreover, the independent deep-water terminal operators, upon whom we New Englanders rely for over one-third of our heating oil supply, informed me yesterday that total inventories of No. 2 home heating oil as of July 1 are more than 80 percent below 1972 stocks for the same period – 355,000 barrels in 1973 versus 2,410,000 in 1972. This situation exists despite the need to build up stored reserves now, prior to the commencement of the winter heating season.
Third, the Federal Trade Commission has filed complaints against the eight largest oil companies in the country, charging that these companies have engaged in a variety of uncompetitive practices to control and limit the supply of crude oil to independent refiners and marketers. It will be several years before the final outcome of the FTC action, based on a year-long staff study, is known. But the complaints lend further weight to the contention that the actions of the major oil companies have been an important factor in creating the present situation. Such charges further call into question the effectiveness of any voluntary program for fuel allocations.
Mr. President, the information provided by these three sources – my Maine constituents, the independent terminal operators, and a Federal agency charged with antitrust responsibilities – reinforces my conviction that there must be prompt action by the administration to end its voluntary allocation program and to establish, in its place, a tough mandatory program. Only in this way will we be able to reduce uncertainty in the coming months, enforce an equitable distribution scheme, and insure that we will have effective procedures for pinpointing problems and for dealing with them promptly.
The voluntary allocation program has failed. We can wait no longer for a mandatory program.