THE WHITE HOUSE

Office of the Press Secretary

STATEMENT BY THE PRESIDENT ON OIL IMPORTS

I am today concurring with the Department of Commerce's finding that the nation's growing reliance on imports of crude oil and refined petroleum products threaten the nation's security because they increase U.S. vulnerability to oil supply interruptions. I also concur with the Department's recommendation that the Administration continue its present efforts to improve U.S. energy security, rather than to adopt a specific import adjustment mechanism.

This action responds to a petition under Section 232 of the Trade Expansion Act of 1962, which was filed by the Independent Petroleum Association of America and others on March 11, 1994. The Act gives the President the authority to adjust imports if they are determined to pose a threat to national security. The petitioners sought such action, claiming that U.S. dependence on oil imports had grown since the Commerce Department last studied the issue in response to a similar, 1988 petition.

In conducting its study, the Department led an interagency working group that included the Departments of Energy, Interior, Defense, Labor, State, and Treasury, the Office of Management and Budget, the Council of Economic Advisors, and the U.S. Trade Representative. The Commerce Department also held public hearings and invited public comment. Following White House receipt of the Commerce Department's report, the National Economic Council coordinated additional interagency review.

As in the case of its earlier study, the Commerce Department found that the potential costs to the national security of an oil import adjustment, such as an import tariff, outweigh the potential benefits. Instead, the Department recommended that the Administration continue its current policies, which are aimed at increasing the nation's energy security through a series of energy supply enhancement and conservation and efficiency measures designed to limit the nation's dependence on imports. Those measures include:

• Increased investment in energy efficiency.
• Increased investment in alternative fuels.
• Increased government investment in technology, to lower costs and improve production of gas and oil and other energy sources.
• Expanded utilization of natural gas.
• Increased government investment in renewable energy sources.
• Increased government regulatory efficiency.
• Increased emphasis on free trade and U.S. exports.
• Maintenance of the Strategic Petroleum Reserve.
• Coordination of emergency cooperation measures.

Finally, led by the Department of Energy and the National Economic Council, the Administration will continue its efforts to develop additional cost- effective policies to enhance domestic energy production and to revitalize the U.S. petroleum industry.