oil tanker at sea

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American Maritime Industry Fights Back Against Jones Act ‘Misconceptions’

Mike Schuler
Total Views: 4904
March 10, 2022

The American maritime industry is fighting back against some lawmakers’ calls for a repeal or waiver of the Jones Act after President Joe Biden announced a ban on Russian oil and energy imports.

Since the ban was announced earlier this week, at least two members of Congress have called for the 100-year-old law to be repealed, including Rep. Scott Perry (R-PA) who says any Russian energy ban needs to include an amendment to create exemptions for ships carrying LNG. Perry said he would introduce the amendment as a stand-alone bill.

Rep. Ed Case of Hawaii, a Democrat, has also called for a Jones Act waiver, arguing that the shipping law should be waived to allow foreign ships to transport oil and other petroleum products from mainland U.S. ports to Hawaii in order to help the state replace Russian barrels. Hawaii gets about a third of its crude oil from Russia.

The Jones Act requires that merchandise transported by water between two points in the United States is carried on ships that are U.S.-built, -crewed, owned, and -registered.

The American Maritime Partnership (AMP), representing the domestic maritime industry, contends that there is more than adequate domestic ship capacity to address any requirements to transport oil within the United States, and that a waiver of the Jones Act for gasoline would only benefit oil traders, not American consumers.

In a letter sent to President Joe Biden, the AMP sought to address misconceptions related to the Jones Act and energy prices, as well as the transportation of crude oil and other energy cargoes in the U.S. in light of the energy embargo.

“We appreciate your support and the overwhelming, bipartisan support in Congress for the Jones Act. Ukraine is a lesson that America must provide for its self-defense and economy, and that the 650,000 U.S. men and women of American Maritime will continue to move what our nation needs, including energy,” the AMP said in its letter.

The letter also stressed support in Congress for making sure American ships are used for transporting oil from any drawdowns of the strategic petroleum reserve (SPR).

“In addition to the specific requirements of Section 501, the omnibus appropriations bill for FY ’22 passed by the House last night 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.”

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