194 Policy Criteria for Petroleum 



policies within a maze of national and international considerations. 

 As Dean Mason points out, there is more to the question of appro- 

 priate national oil policies than the merely economic issues. Solutions 

 to problems in the area of pubHc policy as to petroleum resources 

 necessarily are reduced to judgments as to the best practical courses 

 of action. 



Under the public policies as to differential tax treatment for petro- 

 leum and state regulation of production that have obtained over the 

 past quarter of a century, oil and natural gas have supplied a steadily 

 increasing share of the energy base for the country's expanding econ- 

 omy. Evidence over a long period as to the net result, in terms of 

 over-all economic progress as well as national security, is impressive 

 in support of petroleum policy judgments that have been made. Under 

 these policies an adequate, continuous supply of petroleum has been 

 provided at prices that enabled the growth in oil and gas use at a faster 

 rate than the expansion in the general economy. This in no sense over- 

 looks the problems under consideration here. On the contrary, petro- 

 leum policies are of increasing and particular concern. 



Today, for example, federal regulation of natural gas production 

 and national policies as to oil imports are immediate issues with far- 

 reaching implications. Proper solutions to such problems cannot be 

 found within the independent concepts of law, technology, economics, 

 or security planning. The appropriate course of action inevitably in- 

 volves conflicting viewpoints and compromise. 



If utility-type price controls of natural gas prices at the well impair 

 the development of this energy resource, as would be expected, is 

 there a net gain or loss to the total economy? If increasing imports 

 mean temporarily lower prices and encouragement of foreign trade, 

 but also vulnerability to loss of supplies, such as resulted from the 

 closing of the Suez Canal, and to the demands of other nations, which 

 is the better course of action? Clearly, such questions go beyond the 

 interests of the parties directly concerned — importing companies and 

 domestic producers, for example. These are areas of public policy, as 

 recognized in the appointment of a Cabinet-level committee to study 

 the oil import problem. The following conclusion by that committee 

 in its July 1957 report serves to illustrate that the issues are not lim- 

 ited to economic considerations: 



