Proclamation 3279—Adjusting Imports of Petroleum and Petroleum Products Into the United States

Whereas, pursuant to section 2 of the act of July 1, 1954, as amended (72 Stat. 678, 19 U.S.C. 1352a), the Director of the Office of Civil and Defense Mobilization has made an appropriate investigation to determine the effects on the national security of imports of crude oil and crude oil derivatives and products and, having considered the matters required by him to be considered by the said act of July 1, 1954, as amended, has advised me of his opinion "that crude oil and the principal crude oil derivatives and products are being imported in such quantities and under such circumstances as to threaten to impair the national security"; and

Whereas, having considered the matters required by me to be considered by the said act of July 1, 1954, as amended, I agree with the said advice; and

Whereas I find and declare that adjustments must be made in the imports of crude oil, unfinished oils, and finished products, so that such imports will not so threaten to impair the national security; and

Whereas I find and declare that within the continental United States there are two areas, one, east of the Rocky Mountains (Districts I-IV), in which there is substantial oil production capacity in excess of actual production, and the other. west of the Rocky Mountains (District V), in which production is declining and in which, due to the absence of any significant inter-area flow of oil, limited imports are necessary to meet demand, and that accordingly, imports into such areas must be treated differently to avoid discouragement of and decrease in domestic oil production, exploration and development to the detriment of the national security; and

Whereas I find and declare that the Commonwealth of Puerto Rico largely depends upon imported crude oil, unfinished oils, and finished products and that any system for the adjustment of imports of such commodities should permit imports into Puerto Rico adequate for the purposes of local consumption, export to foreign areas, and limited shipment of finished products to the continental United States:

Now, Therefore, I, Dwight D. Eisenhower, President of the United States of America, acting under and by virtue of the authority vested in me by section 2 of the act of July 1, 1954, as amended, do hereby proclaim as follows:

SECTION 1. (a) In Districts I-IV, District V, and in Puerto Rico, on and after March 11, 1959, no crude oil or unfinished oils may be entered for consumption or withdrawn from warehouse for consumption, and on and after April 1, 1959, no finished products may be entered for consumption or withdrawn from warehouse for consumption, except (1) by or for the account of a person to whom a license has been issued by the Secretary of the Interior pursuant to an allocation made to such person by the Secretary in accordance with regulations issued by the Secretary, and such entries and withdrawals may be made only in accordance with the terms of such license, or (2) as authorized by the Secretary pursuant to paragraph (b) of this section, or (3) as to finished products, by or for the account of a department, establishment, or agency of the United States, which shall not be required to have such a license but which shall be subject to the provisions of paragraph (c) of this section.

(b) Until the Secretary of the Interior is able to make allocations and issue licenses, he may, subject to such conditions as he may deem appropriate, temporarily authorize such entries and withdrawals without licenses and the quantities so entered or withdrawn shall be deducted from any allocation subsequently made by the Secretary to any person who has made any such entry or withdrawal.

(c) In Districts I-IV, District V, and in Puerto Rico, on and after April 1, 1959, no department, establishment, or agency of the United States shall import finished products in excess of the respective allocations made to them by the Secretary of the Interior. Such allocations shall be within the maximum levels of imports established in section 2 of this proclamation.

SEC. 2. (a) (1) In Districts I-IV the maximum level of imports of crude oil, unfinished oils, and finished products, except residual fuel oil to be used as fuel, shall be approximately 9% of total demand in these districts, as estimated by the Bureau of Mines for periods fixed by the Secretary of the Interior. Within this maximum level, imports of finished products, exclusive of residual fuel oil to be used as fuel, shall not exceed the level of imports of such products into these districts during the calendar year 1957 and imports of unfinished oils shall not exceed 10% of the permissible imports of crude oil and unfinished oils.

(2) In Districts I-IV the imports of residual fuel oil to be used as fuel shall not exceed the level of imports of that product into these districts during the calendar year 1957.

(b) In District V the maximum level of imports of crude oil, unfinished oils, and finished products shall be an amount which, together with domestic production and supply, will approximate total demand in this district as estimated by the Bureau of Mines for periods fixed by the Secretary. Within this maximum level imports of finished products shall not exceed the level of imports of such products into this district during the calendar year 1957 and imports of unfinished oils shall not exceed 10% of the permissible imports of crude oil and unfinished oils.

(c) Such additional imports of crude oil may be permitted in addition to the maximum levels established in paragraphs (a) and (b) of this section as are necessary to meet the minimum requirements of refiners, and pipeline companies using crude oil directly as fuel, which are not able to obtain sufficient quantities of domestic crude oil by ordinary and continuous means, such as by barges, pipelines, or tankers.

(d) The maximum level of imports of crude oil, unfinished oils, and finished products into Puerto Rico shall be approximately the level of imports into Puerto Rico during all or part of the calendar year 1958, as determined by the Secretary of the Interior to be consonant with the purposes of this proclamation, or such lower or higher levels as the Secretary may subsequently determine are required to meet increases or decreases in local demand in Puerto Rico or demand for export to foreign areas.

(e) The Secretary of the Interior shall keep under review the imports into Districts I-IV and into District V of residual fuel oil to be used as fuel and the Secretary may make, on a monthly basis if required, such adjustments in the maximum level of such imports as he may determine to be consonant with the objectives of this proclamation.

(f) The levels established, and the total demand referred to, in this section do not include free withdrawals by persons pursuant to section 309 of the Tariff Act of 1930, as amended (19 U.S.C. 1309), or petroleum supplies for vessels or aircraft operated by the United States between points referred to in said section 309 (as to vessels or aircraft, respectively) or between any point in the United States or its possessions and any point in a foreign country.

SEC. 3. (a) The Secretary of the Interior is hereby authorized to issue regulations for the purpose of implementing this proclamation. Such regulations shall be consistent with the levels established in this proclamation for imports of crude oil, unfinished oils, and finished products into Districts I-IV, into District V, and into Puerto Rico, and shall provide for a system of allocation of the authorized imports of such crude oil, unfinished oils and finished products and for the issuance of licenses pursuant to such system, with such restrictions upon the transfer of allocations and licenses as may be deemed appropriate to further the purposes of this proclamation.

(b) (1) With respect to the allocations of imports of crude oil and unfinished oils into Districts I-IV, and into District V, such regulations shall provide, to the extent possible, for a fair and equitable distribution among persons having refinery capacity in these districts in relation to refinery inputs during an appropriate period or periods selected by the Secretary and may provide for distribution in such manner as to avoid drastic reductions below the last allocations under the Voluntary Oil Import Program. Such regulations also shall provide for allocations of crude oil to persons having operating refinery capacity or having pipeline facilities using crude oil directly as fuel who show inability to obtain sufficient quantities of domestic crude oil by ordinary and continuous means, such as barges, pipelines, or tankers.

(2) Such regulations shall provide for the allocation of imports of crude oil and unfinished oils into Puerto Rico among persons having refinery capacity in Puerto Rico in relation to refinery inputs during all or a part of the calendar year 1958 as the Secretary may determine.

(3) Such regulations shall require that imported crude oil and unfinished oils be processed in the licensee's refinery except that exchanges for domestic crude or unfinished oils may be made if otherwise lawful, if effected on a current basis and reported in advance to the Secretary, and if the domestic crude or unfinished oils are processed in the licensee's refinery. However, persons receiving allocations of crude oil on the basis of inability to obtain sufficient domestic crude by ordinary and continuous means shall not be permitted to make exchanges.

(4) With respect to the allocations of imports of finished products into Districts I—IV, District V, and Puerto Rico, such regulations shall, to the extent possible, result in a fair and equitable distribution of such products among persons who have been importers of finished products during the respective base periods specified in section 2 of this proclamation.

(c) Such regulations may provide for the revocation or suspension by the Secretary of any allocation or license on grounds relating to the national security, or the violation of the terms of this proclamation, or of any regulation or license issued pursuant to this proclamation.

SEC. 4. For the purpose of hearing and considering appeals or petitions by persons affected by the regulations issued by the Secretary of the Interior, he is authorized to provide for the establishment and operation of an Appeal Board, comprised of one representative each from the Departments of the Interior, Defense, and Commerce to be designated, respectively, by the heads of such Departments. Such representatives shall be of the rank of Deputy Assistant Secretary or higher. The Appeal Board may be empowered, on grounds of hardship, error, or other relevant special consideration, but within the limits of the maximum levels of imports established in section 2 of this proclamation (1) to modify any allocation made to any person under the regulations issued pursuant to section 3 of this proclamation, (2) to grant allocations of crude oil and unfinished oils in special circumstances to persons with importing histories who do not qualify for allocations under such regulations; and (3) to review the revocation or suspension of any allocation or license. The Secretary may provide that such decisions by the Appeal Board shall be final.

SEC. 5. Persons who apply for allocations of crude oil, unfinished oils, or finished products and persons to whom such allocations have been made shall furnish to the Secretary of the Interior such information and shall make such reports as he may require, by regulation or otherwise, in the discharge of his responsibilities under this proclamation.

SEC. 6. (a) The Director of the Office of Civil and Defense Mobilization shall maintain a constant surveillance of imports of petroleum and its primary derivatives in respect of the national security and, after consultation with the Secretaries of State, Defense, Treasury, the Interior, Commerce, and Labor, he shall inform the President of any circumstances which, in the Director's opinion might indicate the need for further Presidential action under section 2 of the act of July 1, 1954, as amended. In the event prices of crude oil or its products or derivatives should be increased after the effective date of this proclamation, such surveillance shall include a determination as to whether such increase or increases are necessary to accomplish the national security objectives of the act of July 1, 1954, as amended, and of this proclamation.

(b) The Special Committee to Investigate Crude Oil Imports is hereby discharged of its responsibilities.

SEC. 7. The Secretary of the Interior may delegate, and provide for successive redelegation of, the authority conferred upon him by this proclamation. All departments and agencies of the Executive branch of the Government shall cooperate with and assist the Secretary of the Interior in carrying out the purposes of this proclamation.

SEC. 8. Executive Order 10761 of March 27, 1958, entitled "Government Purchases of Crude Petroleum and Petroleum Products" (23 F.R. 2067) is hereby revoked as of April 1, 1959.

SEC. 9. As used in this proclamation:

(a) "Person" includes an individual, a corporation, firm, or other business organization or legal entity, and an agency of a state, territorial, or local government, but does not include a department, establishment, or agency of the United States;

(b) "Districts I-IV" means the District of Columbia and all of the States of the United States except those States within District V;

(c) "District V" means the States of Arizona, Nevada, California, Oregon, Washington, Alaska, and the Territory of Hawaii;

(d) "Crude oil" means crude petroleum as it is produced at the wellhead;

(e) "Finished Products" means any one or more of the following petroleum oils, or a mixture or combination of such oils, which are to be used without further processing except blending by mechanical means:

(1) liquefied gases—hydrocarbon gases recovered from natural gas or produced from petroleum refining and kept under pressure to maintain a liquid state at ambient temperatures;

(2) gasoline—a refined petroleum distillate which, by its composition, is suitable for use as a carburant in internal combustion engines;

(3) jet fuel—a refined petroleum distillate used to fuel jet propulsion engines;

(4) naphtha—a refined petroleum distillate falling within a distillation range overlapping the higher gasoline and the lower kerosenes;

(5) fuel oil—a liquid or liquefiable petroleum product burned for lighting or for the generation of heat or power and derived directly or indirectly from crude oil, such as kerosene, range oil, distillate fuel oils, gas oil, diesel fuel, topped crude oil, residues;

(6) lubricating oil—a refined petroleum distillate or specially treated petroleum residue used to lessen friction between surfaces;

(7) residual fuel oil—a topped crude oil or viscous residuum which, as obtained in refining or after blending with other fuel oil, meets or is the equivalent of Military Specification Mil-F-859 for Navy Special Fuel Oil and any other more viscous fuel oil, such as No. 5 or Bunker C;

(8) asphalt—a solid or semi-solid cementitious material which gradually liquefies when heated, in which the predominating constituents are bitumins, and which is obtained in refining crude oil.

(f) "Unfinished Oils" means one or more of the petroleum oils listed in paragraph (e) of this section, or a mixture or combination of such oils, which are to be further processed other than by blending by mechanical means.

In Witness Whereof, I have hereunto set my hand and caused the Seal of the United States of America to be affixed.

DONE at the City of Washington this 10th day of March in the year of our Lord nineteen hundred and fifty-nine, and of the Independence of the United States of America the one hundred and eighty-third.

DWIGHT D. EISENHOWER

By the President:

CHRISTIAN A. HERTER,

Acting Secretary of State