Here we go again. Every time there’s an issue in the news that affects economics and grabs public attention—whether it’s COVID-19, supply chain disruptions, or overseas turmoil—you can trust the oil companies to use it as an excuse to once again attack and blame the Jones Act.
The Jones Act requires that point-to-point shipping in the U.S. be carried on American bottoms crewed by American crews. It’s been a target of oil shippers for decades. Now that Russia and Ukraine are in the news, oil companies are again reportedly applying for Jones Act waivers.
That led America’s Maritime Partnership, a coalition that advocates for and defends the Jones Act, to write a letter March 10 to President Joe Biden. AMP represents virtually every element of the U.S. domestic maritime fleet, including maritime workers, vessel operators, and shipyards. The letter, signed by Ku’uhaku Park, president of the AMP, reminded the president, “Today there is more than adequate American vessel capacity to address any requirements to transport oil within the United States.” There is a waiver process available under Section 501, and one was applied for but denied when the U.S. Maritime Administration and Customs and Border Patrol determined that domestic vessels were available. Most of the waiver requests after the cyberattack on the Colonial Pipeline were also found to be unlawful.
The letter points out that waivers would not benefit consumers, only oil traders. The Jones Act has nothing to do with the drivers of the recent rise in oil and gasoline prices, which have driven crude oil prices higher by more than 57 percent in just two months.
Just recently, the letter said, “Congress has expressed its concern about ensuring that American vessels are used to move oil from the strategic petroleum reserve before considering the possibility of Jones Act waivers. In addition to the specific requirements of Section 501, the omnibus appropriations bill for FY ’22 passed by the House … requires federal agencies to take steps to ensure the use of American vessels before considering Jones Act waivers related to the transport of oil from the SPR. This is a strong contemporary signal from Congress that Jones Act waivers for SPR drawdowns should be considered only when American vessels are not available.”
It’s for situations just like this that we need organizations like AMP. Fortunately, as Park reported to AMP’s membership in February, bipartisan support for the Jones Act has never been higher in Congress, and President Biden himself has expressed strong support. That doesn’t mean that vigilance should be relaxed.