Coping and Hoping

While oilmen and Congressmen were debating the subject of profits, the energy crisis continued to shape the destinies of diplomats and bureaucrats, motorists and householders. Among last week's major developments:

PRICES. The Commerce Department announced another sharp jump in retail fuel prices during December, ranging from 4.4% for gasoline to 11.4% for home heating oil. Americans now pay about 20% more than they did a year ago for gasoline and motor oil, and nearly 47% more for heating oil. Many people are paying even more than that; Internal Revenue Service agents found that an astounding four out of every ten gas stations that they visited in California and New York were overcharging by as much as 60 per gal.

LEGISLATION. President Nixon sent to Congress a long list of energy proposals designed to reduce U.S. dependence on foreign oil. The President backed off from the goal of total energy "self-sufficiency" by 1980, which was part of his overblown Project Independence. Now he talked more realistically about reducing the nation's reliance on "potentially insecure foreign supplies of energy," by which he surely meant Arab oil. The President recommended:

> Increasing Government spending for energy research by almost 100%, to nearly $2 billion in the fiscal year that begins in July. Of that, $724 million will go for nuclear-power research, $427 million for coal studies and $154 million for solar and geothermal projects.

> Raising to 10 million acres the amount of territory off the nation's seacoasts that will be leased to oil and natural-gas drillers beginning in 1975, or about triple the acreage previously scheduled for offshore drilling.

> Shortening the time that it takes to license and construct nuclear power plants, from the present average of nine years to about six years.

> Requiring new autos and large household appliances--air conditioners, refrigerators, ranges and the like--to carry "efficiency labels" indicating how much energy they use and how much they waste.

> Providing special unemployment benefits for workers who lose their jobs because of the energy shortage. Essentially, Nixon wants to expand existing jobless pay in places where businesses are especially hard hit by the fuel crisis.

The President also asked Congress to forget the Emergency Energy Act that got bogged down before the Christmas recess because of disagreement over taxing oil companies' "excess profits." Instead, Nixon wants Congress to whip through a "basic bill" that would make the Administration's fuel-allocation and conservation measures legally binding. Energy Chief William E. Simon is afraid that unless these measures are quickly made mandatory, consumers will slacken their so far successful conservation efforts, particularly if the Arab oil flow resumes. Yet in its present mood of hostility to oil companies, Congress will almost certainly ignore the President's request and stick with the original Emergency Energy Act, including some provision to limit excess profits. If so, the President has indicated that he will veto the measure.

THE EMBARGO. In the most optimistic statement about oil since the Middle East troop withdrawal agreement two weeks ago, Secretary of State Henry Kissinger hinted strongly that the oil embargo will be lifted by March 5. "We have had every reason to believe that success in the troop-withdrawal negotiations would mark a major step toward ending the oil embargo," he told a news conference. "We would therefore think that failure to end the embargo in a reasonable time would be highly inappropriate." When asked what he meant by a "reasonable time," Kissinger said he was thinking "in more ambitious terms" than the March 5 deadline for the completion of the troop pullback.

Egyptian President Anwar Sadat toured Arab capitals and argued for a relaxation of the embargo. Yet Libya and Iraq remained opposed to lifting the boycott. The Saudis, who hold the key, and other Arab leaders are still noncommittal on the subject. Arab oil ministers will try to resolve their differences when they meet in Tripoli on Feb. 14.

Even if that meeting produces an end to the embargo, it could be months before the flow of Arab oil to the U.S. increases significantly. Tankers take as long as a month to travel from the Persian Gulf to U.S. ports, and oilmen generally believe that the Arabs intend to hold down production no matter what happens to the boycott. Petroleum imports into the U.S. are running about 30% below the level of last November. And it is unlikely that the Arabs will ever allow the price of crude to recede to pre-boycott levels, which were as little as one-third of today's prices.

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