AMARILLO, Texas--(BUSINESS WIRE)--In a letter directed to the President of the United States and received by the White House, the founders of (PIRI), the Panhandle Import Reduction Initiative representing thousands of independent small producers of oil in the Southwest United States wrote, “We call upon President Donald J. Trump for a second Presidential Memorandum to order the Secretary of Commerce, to establish the crude oil industry as a “Core” industry to be added to steel, aluminum, vehicles, aircraft, shipbuilding and semiconductors. Crude oil should be recognized as one of the critical elements of US manufacturing and defense industrial bases, which we must defend against unfair trade practices and other abuses.”
The PIRI founders further stated in the letter “Following the Presidential Memorandum on the case for steel against Chinese export practices that you signed, PIRI further calls for an immediate Investigation by the Department of Commerce of Saudi Arabia and OPEC abuse between August 2014 and March 2016 of the American oil industry by expanding production to lower world oil prices to destabilize and cause hardships to American producers mainly of light tight oil (shale oil). This was an announced effort to undermine and shut-down producers with higher costs of production. According to one estimate some 150 US companies filed bankruptcy and $150 billion in capital outlay postponed or cancelled. More than 300,000 US industry-related jobs were lost.”
This abuse under the Trade Expansion Act of 1962 should be investigated, similar to the investigation of the domestic steel industry,
“to consider the domestic production of crude oil needed for projected national defense requirements, the existing and anticipated availabilities to meet such requirements; the capacity of domestic industry to meet such a requirement, the existing and anticipated availabilities of human resources, products, raw materials, and other services essential to national defense, the requirements of growth of such industries and such supplies and services, including the investment, exploration and development necessary to assure growth, and the importation of goods in terms of their quantities, availabilities, character, and use as those affect such industries and the capacity of the United States to meet national security requirements.”
PIRI asks President Donald J. Trump on behalf of its thousands of members that this investigation include a characterization of the new crude oil industry based on new technology that is producing oil at historic high levels and has resisted a shutdown and abuse with this technology. Further, PIRI requests a review of national defense with domestic oil production capable of self-sufficiency in contrast to dependency on foreign oil imports over water (oceans) with consequent cost of deployment of naval protection and other military protection of the “flow of world oil” should be included. The cost of a strategic petroleum reserve of nearly one billion barrels of oil is no longer justified as a hedge against foreign oil import disruption.
For National security, the unfair trade act of overcapacity against US oil producers must stop, Mr. President. Stopping overcapacity is paramount, as in the case of Chinese steel, of Saudi Arabian and to lesser extent of Gulf Nations production and export of crude oil and its potential to be used at any time as a tool to compete with and damage American producers in a future strategic “price war” for market share which occurred from 2014-2016. This should include the purpose of “spare capacity” in Saudi Arabia as an offset to supply disruption threats to the United States which now has domestic production that would leave it unaffected. There is a potential that “spare capacity” can again be used and would constitute an “abuse” as “overcapacity” to lower prices and threaten the new American crude oil industry.
The letter concludes: "Mr. President, American superiority in energy security means self-sufficiency: Throwing off these trade shackles then is the fight for fair trade in Steel and Aluminum, we must prevail in the fight for US oil producers too."