The decision to draw down 30 million barrels of crude from the U.S. Strategic Petroleum Reserve (SPR) is still making news a year later.
That’s not much oil in a world that consumes 88 million barrels a day, but hauling it would have been a nice piece of work for the U.S. tug and barge industry, potentially over 100 voyages.
Despite the Jones Act’s requirement that coastal cargo move in U.S.-flagged, built, and crewed vessels, only a single 150,000 barrel SPR shipment went on a U.S. barge. Twenty-four million barrels were hauled in foreign tankers.
At a June hearing before the House Coast Guard and Maritime Transportation Subcommittee, Deputy Transportation Secretary John D. Porcari cited urgency to accomplish the drawdown within an Energy Department “prescribed timeframe,” which he said would have been too difficult to accomplish with smaller barges. So 52 waivers were granted to foreign tankers.
Thomas Allegretti, president of the American Waterways Operators, who testified for the American Maritime Partnership, said U.S. barges might not have been able to move all the SPR oil in a month but noted the Jones Act doesn’t say “American vessels must only be used if they meet arbitrary, unwritten criteria developed secretly by an administration official.” He puts most of the blame on the Energy Department, which he said signaled its willingness to grant waivers from the getgo.
But oil companies and traders jumped at the chance to use cheaper, foreign ships. It’s a hell of a way to treat the companies that handle your product day in and day out, no? – Chris Dupin
Jones Act waivers that don’t add up
