An oil import fee could cost consumers nearly 17 billion dlrs a year and undermine long-term U.S. energy security by leading to a quicker depletion of domestic reserves a Federal Trade Commission study said. The study by the FTCs bureau of economics found that a five dlr a barrel tariff on crude oil and gasoline oil imports would increase costs to consumers by 14 to 16.7 billion dlrs a year. After weighing the benefits of such a tariff against the costs the study found a five dlr a barrel import fee would have a net cost to the economy of 3.6 billion dlrs a year. Several oil import fee proposals ranging from two to 10 dlrs a barrel have been made in Congress in an effort to cut the federal budget deficit and maintain the momentum for energy conservation programs which have been hurt by cheaper oil. But by making foreign oil more expensive the tariffs would reduce oil imports and force greater consumption of domestic oil which would deplete U.S. reserves faster the study found. Any attempt to increase our energy security by limiting imports will actually reduce our long-run energy security by speeding the depletion of domestic reserves the study said. The five dlr a barrel tariff would also cut domestic petroleum refiners profits by 7.5 to 10 billion dlrs a year increase domestic crude oil producers profits by about 13 billion dlrs a year and raise government revenues by 6.7 to 8.2 billion dlrs a year the FTC said. Under the Reagan administration the FTC has consistently opposed government regulation of the oil industry at the state and federal levels. This study backs up my belief that government regulation and interference with competition hurt both the market and consumers FTC Chairman Daniel Oliver said in a statement.
FTC FINDS 17 BILLION DLR COST IN OIL IMPORT FEE