Following in the footsteps of gas pipelines, major producershave asked the federal government to reject an independentproducer-backed petition that seeks to have tariffs imposed oncrude oil imports from four foreign countries accused of illegaldumping.

In a letter to Commerce Secretary William M. Daley, John Sharpof the Natural Gas Supply Association (NGSA) urged the departmentto dismiss a pending petition to have tariffs assessed on importsfrom Mexico, Venezuela, Saudi Arabia and Iraq. A coalition ofindependent domestic producers, called “Save Domestic Oil,” filedthe petition in an attempt to stop the foreign producers fromallegedly dumping oil in the United States.

Sharp said the charges outlined in the petition were “withoutmerit,” arguing that the foreign producers had “rational economicreasons” for selling their oil at lower prices. Also, NGSA believesthat imposing a tariffwould not be in the “best interest” ofdomestic producers because the foreign producers would simply selltheir oil to other countries, resulting in “costly inefficiencies”in the U.S. crude oil distribution, transportation and refiningsystem, he wrote.

The producer group further fears such restrictions could trigger”retaliatory actions” by other foreign countries. “Indeed, we areconcerned that the…..petition has apparently caused Mexico toreconsider its decision to eliminate the tariff it imposes onimports of natural gas from the U.S. NGSA members support and havean economic interest in the early elimination of that tariff.”

The association’s members “are struggling to recover from theeffects of the record low oil prices of last year and early thisyear, and we sympathize with others who are having the sameexperience. However, we are convinced that imposing traderestrictions will not aid in the recovery of our industry,” Sharpsaid.

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