STUDY PREDICTS U.S. DEPENDENCE ON FOREIGN OIL
A government study has concluded the
U.S. Will be dependent on oil from the middle east into the
next century and must take steps to reduce its vulnerability,
the New York Times said.
    The newspaper said the inter-agency government study found
a serious oil-dependency problem due to steadily falling
domestic production and rising demand for imported oil.
    The study concluded that by 1995 the U.S. Will be relying
on foreign countries for 50 pct of its oil, more than the peak
of 48 pct reached in 1977 and far above the 33 pct rate during
the 1973-74 Arab oil embargo.
    The U.S. Now imports about 38 pct of its oil needs, up from
27 pct a year ago, the New York Times said.
    It said recommendations sent to the White House by Energy
Secretary John Harrington include financial incentives to raise
domestic oil production by one mln barrels a day from the
current 8.4 mln barrels.
    The newspaper said the administration has placed increased
emphasis on stockpiling oil reserves. It said the view now held
is that the Strategic Petroleum Reserve to be tapped in times
of shortages, should be increased by 100,000 barrels a day,
rather than 35,000 as called for in the 1988 budget.
   The newspaper said Harrington may propose restoring the
depletion allowance to major producers.
    "The administration also plans to renew its efforts to
...Repeal the windfall profits tax, remove bars to drilling on
the outer continental shelf and repeal the law that limits the
use of natural gas in industrial and utility boilers," it added.
    The New York Times quoted Senator Don Nickles of Oklahoma
as saying the study greatly underestimated potential U.S.
Demand for imported oil in the next decade and overestimated
the amount of domestic oil which would be produced.
 REUTER
