Sharing the Shortage

As the summer driving season approaches, high-compression concern has been building up among the motoring public over the shortage of gasoline. Nearly 2,000 independent filling stations across the nation have either run out of gas completely or are staying open only on a day-to-day basis. Officials in Boston, Atlanta and Des Moines have had trouble finding any distributors willing to supply city vehicles with gas. Tugboats have been stranded on the Mississippi with empty tanks. Farmers fear running out of fuel for their tractors and irrigation systems. Some half a dozen Congressmen have been working on bills to give the President petroleum-rationing authority.

So last week Deputy Treasury Secretary William Simon, chairman of the Government's Oil Policy Committee, announced an Administration plan to allocate petroleum supplies. The aim, Simon said, is "to share the shortages equitably." Basically, the measure asks major petroleum refiners and marketers to apportion their supplies to customers on the same basis as they did during the twelve months ended last September. Major oil companies have been shipping enough gasoline to their own name-brand filling stations, but they and independent refiners have been cutting off many small marketers--mostly cut-price, off-brand outlets. The victims have charged that the shortage was contrived to eliminate competition. Under the new guidelines, major oil companies will have to share their supplies of gasoline, even if it means reducing deliveries to their own stations.

In addition, suppliers must be prepared to provide extra rations to a number of specified "priority" customers, including hospitals and ambulance fleets, police and fire departments, farmers, food processors and distributors, truckers, airlines and bus systems. To prevent unjustified windfalls, the majors must sell gasoline to the independents at the normal prevailing market price. The entire scheme will be administered by the Interior Department's Office of Oil and Gas. Compliance will be voluntary --much like Phase III wage and price controls--but if the Office of Oil and Gas receives a complaint about a recalcitrant oil supplier, its enforcers can slap a mandatory allocation scheme on the offender. If all goes well, many of the 562 filling stations that have shut down completely could open within a month.

The program merely spreads the gasoline shortage around; it does nothing to increase supplies. Daily consumption of gasoline is running 6% ahead of last year's rate, but refinery production is not keeping pace. Oil company executives say that they are short of crude oil and that their catalytic-crackers are still in the process of switching back to gasoline from home heating oil.

Some politicians and bureaucrats suspect that the shortage was contrived by the oil companies to force prices up and impress Congress with the need to authorize a pipeline to the oilfields of Alaska. The Federal Trade Commission is looking into oil-company marketing practices. Connecticut Attorney General Robert K. Killian has subpoenaed distributors of five major oil companies to explain why gasoline is scarce. And California Assembly Speaker Robert Moretti has set three legislative committees to work investigating the oil industry.

For its part, the Administration has stepped up its low-key exhortations to Americans to conserve fuel. Simon suggested that employers stagger work hours to avoid traffic jams, that commuters form car pools or take mass transit, and that all motorists curtail nonessential driving, use car air conditioners sparingly, and drive more slowly in order to improve gasoline mileage. Otherwise, Simon says, Congress might have to impose a nationwide 50-m.p.h. speed limit on U.S. highways.

This file is automatically generated by a robot program, so reader's discretion is required.