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4622 EX R·E N S I 0 N S 0 F REMARKS 4622 CONGRESSIONAL RECORD- HOUSE Mar ch 20 EX r ·E N S I 0 N S 0 F REMARKS Some Solid Facts on Imported Residual Comment. Actually, the real growth in now being used to haul it to markets for­ dependence on residual in New England, did merly considered immune, and further Fuel Oil not take place until cheap foreign oil be­ damage to the coal and railroad industries gan to come in in volume in the late 1940's. serving New England is threatened. In 1946, for instance, New England used only 3. The statement is made that the New EXTENSION OF REMARKS 30 m11lion barrels of residual, which pro­ England area "could never go back to coal, OF vided 24.6 percent of her competitive energy and must have increasing quantities of this requirementS. This was only about 9 mil­ product (residual) every year as its economy HON. ED EDMONDSON lion barrels more than was used in 1935. expands" (p. 3) . OF OKLAHOMA However, between 1946 and 1960, total re­ Comment. This statement is completely IN THE HOUSE OF REPRESENTATIVES sidual use increased to 71 million barrels, indefensible. New England could certainly and in that year it provided 31.1 percent of return to coal as a major fuel source, and Tuesday, March 20, 1962 her competitive energy. Coal, in the mean­ we are convinced that it eventually will have Mr. EDMONDSON. Mr. Speaker, it time, dropped from 54.7 percent of New Eng­ to do so. This switch could be made with is difficult to look objectively at any land's energy source in 1946 to 17.7 percent little impact on fuel costs, and it would in 1960. The big increase in that same pe­ surely be to the advantage of New England question involving an imported product riod came in distillate oils, largely used for in the long run since domestic coal is more which competes directly and often de­ home and commercial space heating and likely to remain a dependable, low cost and structively with an American product. which is not subject to the residual import stable fuel for New England in the future I am sure that my good friends from control program. Indeed, a very small than is imported residual oil. Certainly, if New England, who in the March 7 CoN­ amount of distillates is imported at all. Dis­ domestic coal and oil sources are dried up GRESSIONAL RECORD quoted liberally from tillates, as a proportion of the competitive because of imported residual competition, the New England Council on the sub­ fuel source for New England, increased from there would remain no check on residual 20.8 percent in 1946 to 42.4 percent in 1960. prices and they could be expected to soar ject of imported residual oil, would want In the same period gas increased from a neg­ to previously unreached levels. both the President and the Members of ligible amount to 8.8 percent. 4. Mr. Couzens challenges the use of the this body to look carefully at all aspects Note. In the same testimony Mr. Couzens term "dumped" to refer to imported residual of the import quota controversy. refers to the great loss of the home-heating and attempts to deny that it is "cheap" in I am equally sure that they are fa­ market by coal in New England, just as resid­ price by contending that it is not cheap at miliar with the testimony given by the ual oil appeared on the scene. This would the point of origin (p. 4). · New England council-through its fuels appear to suggest that the two are related. Comment. The price in Venezuela has committee chairman, Mr. ·. James S. Although opponents of residual controls been maintained, and thus that nation has have frequently attempted to confuse the suffered no cut in its revenue per barrel Couzens-before Subcommittee No.4 of facts by implying that residual controls af­ on residual shipped to the United States, the House Select Committee on Small fect the home-heating market, the fact is although the posted price there is consider­ Business, the chairman of which is the that residual is not used for such purposes ably lower than the U.S. domestic residual Honorable ToM STEED, of Oklahoma. and its price has no effect whatever on the price. However, the price for which foreign I am not so sure that they are familiar cost of home-heating oils. These are distil­ residual is sold within the United States has with the detailed and persuasive testi­ late oils, which are not imported· except in varied many times in recent years, practi­ mony of the Honorable PAT JENNINGS, negligible quantities. cally always being determined by what price our able colleague from Virginia, who 2. Mr. Couzens says that the conversion is necessary to capture the market, and this from coal to residual oil "has now progressed usually means, what price is necessary to appeared before the Steed subcommit­ to the point where the New England area is undercut coal. In the opinion of the do­ tee to answer, point by point, the testi­ almost completely dependent upon residual mestic fuels industries, who have seen their mony previously given by Mr. Couzens. oil. The economy could not survive with­ markets gradually whittled away by this Because it is a masterful refutation out it." predatory pricing practice, this method of of many points raised on this issue by This calls for two comments: disposing of a foreign product in American the New England Council and others First, if Mr. Couzens' statement is correct, trade channels constitutes "dumping." The who oppose these quotas, I believe it is in the threat of residual imports to national reference on page 5 to the ~ost of shipping the public interest to insert the full text security has indeed become critical. As he residual as against the cost of shipping coal of Congressman JENNINGS' statement in further points out, current residual demands is nothing but an obvious effort to confuse by New England can now be furnished only the issue. The only pertinent fact is the the RECORD, and am so doing. from foreign-oil sources. Virtually unlimit­ price at the point of consumption. It is also noteworthy that Chairman ed imports of cheaper foreign residual have 5. Reference is made to table I filed with STEED, at the conclusion of Congressman steadily dried up domestic production by Mr. Couzens' statement which reports the JENNINGS' statement, commented upon making it more and more unprofitable. results of public bidding by 15 public agen­ the great importance of the New Eng­ Thus, by his own testimony, it is clear that cies for residual oil in 1960. The conclusion land industrial complex, and further as­ a substantial portion of New England is now is that there was an increase of 25 cents serted: wholly dependent on a fuel source which in posted tank car prices, which affected would be closed in event of national emer­ their prices, from 1959 to 1960, and that No one yet has been able to make any sub­ gency, or political upheaval in major supply­ changes in the discounts allowed resulted in stantial showing that New England can hope ing areas. Certainly an those in Govern­ a weighted average cost increase to these 15 to get this fuel from these foreign sources ment concerned with defense procurement agencies of 48 cents per barrel between 1960 in time of emergency. and production planning must carefully note and 1961. Congressman JENNINGS' testimony fol­ this crucial situation, and bear it in mind Comment. The statement compares prices when allocating national defense contracts between 1959 and 1960, but significantly lows: which would have to be completed under fails to mention that 1959 was an extremely TESTIMONY OF CONGRESSMAN WILLIAM PAT conditions which might see a serious dis­ low price period, being considerably less JENNINGS BEFORE THE SUBCOMMITTEE No. ruption of the flow of foreign oil into that than the more normal year of 1958, for ex­ 4 OF THE HOUSE SELECT COMMITTEE To area. ample. According to the authoritative CONDUCT STUDY AND INVESTIGATION OF THE Second, although his warning is ample "Platt's Oil Price Handbook," the average of PROBLEMS OF SMALL BUSINESS COMMENT­ proof of the grave danger the Nation faces "lows and highs" for Boston tank car prices ING ON THE TESTIMONY OF MR. JAMES S. in its need to maintain essential production in the past 3 years have been: COUZENS, NEW ENGLAND COUNCIL under emergency conditions, it implies that 1958 ______________________________ $2.7138 The testimony of Mr. James S. Couzens, coal and natural gas are no longer important of the New England Council, before this fuels for any of New England's factories and 1959-------- ---------------------- 2.5652 subcommittee on November 22, contains establishments. Actually, of course, residual 1960------------------------------ 2.6852 some rather surprising statements, which oil, despite its cheap dumped price, has Thus, the average posted 1960 prices was 12 must be examined more closely if we are to only usurped the market along the coast. cents (rather than 25 cents) higher than have a clear understanding of the impact of Inland, where residual is impossible or ex­ 1959, but 3 cents less than 1958. residual oil controls. tremely difficult to deliver, New England is In all such dJscussions of prices, however, Among them: still largely dependent on a healthy coal two basic facts must be kept in mind. First, 1. He states that residual oil appeared on industry for its industrial fuel. In the past, only the cargo price of imported residual re­ the New England scene "to 1·eplace bitumi­ the difficulty of delivery of this heavy flects import .prices and only an increase at nous coal for space heating, process steam, sludge-type oil has prevented its widespread this level, which has not occurred, would be and general use by industry" during the use in inland at·eas.
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