Survey of Oil Company Views on Fair Sharing in an International Oil Supply Disruption

Gao ID: NSIAD-85-45 February 5, 1985

Pursuant to a congressional request, GAO surveyed U.S. oil companies that participate in the International Energy Agency (IEA) to determine their views on whether some form of a fair sharing program is needed in the United States to meet an IEA emergency oil sharing obligation.

GAO found that a majority of the companies believe that the government should assume or be prepared to assume a role in ensuring that voluntary oil sharing does not impose an unfair burden on participating companies; however, they do not support a domestic allocation for meeting this objective. Some companies suggested that the use of Strategic Petroleum Reserve (SPR) oil to replace volunteered oil would encourage companies to make voluntary offers. Many companies indicated that the following factors influenced their current views: (1) the growing size of the SPR and the administration's planned use for it; (2) the administration's reliance on a market approach to determine the distribution of supplies during an emergency; and (3) changes in how oil allocated among IEA countries during an emergency would be priced.

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