The Domestic Us Oil Industry And Low Oil Prices

This book, originally published in 1996, traces the development of US government policy toward the oil industry during the 1920s and 1930s when the domestic syustem of production control was established. It then charts the deveopment and collapse of oil import controls, and the wild scramble for economic rents generated by Government regulation. It discusses the two oil crises and the ‘phantom’ Gulf War crisis, and the importance of public opinion in shaping the policy agenda. It also provides an in-depth study of Congressional oil votes from the 1950s to the 1980s and the formation of oil policy, beginning with theories of economic regulation, the role of interest groups in developing the policy agenda and the role of money in politics.

The sharp drop in oil prices is one of the most important global economic developments over the past year. The SDN finds that (i) supply factors have played a somewhat larger role than demand factors in driving the oil price drop, (ii) a substantial part of the price decline is expected to persist into the medium term, although there is large uncertainty, (iii) lower oil prices will support global growth, (iv) the sharp oil price drop could still trigger financial strains, and (v) policy responses should depend on the terms-of-trade impact, fiscal and external vulnerabilities, and domestic cyclical position.

Witnesses: Sen. Evan Bayh, Jeff Bingaman, Conrad Burns, Kent Conrad, Pete Domenici, Byron Dorgan, Peter Fitzgerald, Kay Bailey Hutchison, Tim Johnson, Mary Landrieu, Blanche Lincoln, Trent Lott, Frank Murkowski, Don Pickles, and Craig Thomas; Danny Biggs, Nat. Stripper Well Assoc.; Jonathan Cuneo, Amer. Antitrust Inst.; Gary Fonay, Lynx Petrol., Hobbs, NM; Dewey Bartlett, Jr., Keener Oil and Gas Co.; Jay Hakes, Energy Info. Admin., DoE; Steve Layton, Indep. Petrol. Assoc. of Amer.; John Lichtblau, Petrol. Ind. Res. Fdn.; Robert Palmer, Rowan Co., Inc.; L. R. Raymond, Exxon Corp.; and Ed Schafer, Gov., N.D, and Interstate Oil and Gas Compact Comm.