US oil diet: long way to go for that slim European look
Americans present a decidedly mixed image to the rest of the world, so far as oil conservation is concerned. The United States, on the one hand, was the only major industrial power to reduce its petroleum consumption last year, and the conservation trend accelerates in 1980.
Japan, West Germany, France, and Britain, by contrast, all burned more oil in 1979 than they did in 1978.
So far this year, it looks as though Americans are out to improve their conservation record of 1979.
Through May 23, reports the Department of Energy (DOE), crude oil imports into the US were a substantial 9.8 percent lower than during the comparable months of 1979.
And in recent weeks, the DOE says, imports of crude oil have been down more than 17 percent compared with last year.
Contributing to the savings has been reduced driving by Americans. In the first 143 days of 1980 they burned 8.2 percent less gasoline than during the same period of last year.
But the picture is not all rosy to other peoples looking at the example of the United States.
Take Japan, West Germany, Britain, France, Italy, and Canada, whose combined population is much greater than that of the US. Altogether, these six powers burned 15,016,000 barrels of oil daily in 1979 -- up by 3.6 percent over 1978.
Yet the US, though its total usage dropped last year, still consumed an average of 18,434,000 barrels of oil each day -- 3.4 million barrels a day more than the other six nations put together.
Americans, in other words, still burn a lot more oil per person than people in other rich, advanced lands. A European diplomat summed it up:
"You Americans are going better than we are right now at cutting your use of oil. But you have a lot of fat to burn off, before you get down to the place where Europeans already are."
In Algiers this week, the 13 members of the Organization of Petroleum Exporting Countries (OPEC) -- which supply most of the oil burned by Japan and Western Europe -- continued their haggling over how much oil to sell, and at what price.
With OPEC's prices now ranging from Saudi Arabia's low of $28 a barrel to Algeria's high of more than $38, the Saudis are under great pressure to do two things -- boost their price and lower production.
At this writing, Saudi Oil Minister Ahmad Zaki Yamani resists this pressure -- unless OPEC's other members agree to a unified pricing formula.
Reportedly, the Saudis might lift their price higher -- Iraq Suggests $32 a barrel -- if other producers would freeze or even lower theirs. There are few takers for this proposal.
Over the past year, Saudi Arabia has raised the price of its oil in stages from $18 to $28 a barrel, hoping each time to unify OPEC around the new figure. The response has been still higher price hikes by other producers.
OPEC's other 12 members want Saudi Arabia's output cut from 9.5 million to 8. 5 million barrels a day, or even lower, to foster brisk demand for oil throughout the world. Because of high Saudi production, the world has plenty of oil and cartel members cannot jump prices much higher. Iran, for exmple, finds it hard to sell its oil at $35 a barrel.
"Under present circumstances," said a US oil expert, "the Saudis would be giving a gift to Iran, if they cut back production."
So long as Saudi oil is plentiful, Iran cannot expand it sales of high-priced oil. But, the expert said, if the Saudis took a million barrels a day out of the market, Iran would benefit.
It irks the Saudis that Iran offers roughly the same quality crude as that of Saudi Arabia for $7 a barrel more.
"Also," the expert said, "The Saudis hold more dollars than anyone else. If the world economy is wrecked by soaring oil prices, the value of Saudi dollar holdings tumbles. They seem to be more conscious of this danger than other OPEC members."