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As the U.S. and Israel\u2019s\u00a0war against Iran\u00a0continues to upend\u00a0energy markets\u00a0and\u00a0supply chains\u00a0worldwide, the Trump administration says it will\u00a0temporarily waive\u00a0maritime shipping requirements under a more than century-old law known as the Jones Act.<\/p>\n
The Jones Act requires that goods hauled between U.S. ports be moved on U.S.-flagged vessels. Passed in 1920, this law aims to protect the American shipping sector \u2014 but it\u2019s also faced criticism over the years for slowing the delivery of goods, including\u00a0critical aid during time of crisis.<\/p>\n
On Wednesday, the White House\u00a0said that it would suspend\u00a0Jones Act requirements for 60 days, in a measure that arrives amid wider efforts to counter\u00a0steep oil prices\u00a0and cargo disruptions due to the war. The Jones Act is often blamed for making gas, in particular,\u00a0more expensive. Still, some analysts and industry groups say this waiver will do little to ease consumers\u2019 fuel bills today.<\/p>\n
Here\u2019s what we know.<\/p>\n
What is the Jones Act?<\/p>\n
The Jones Act\u2019s official name is the Merchant Marine Act of 1920. Congress passed the law \u2014 sponsored by Sen. Wesley Jones of Washington state \u2014 in an effort to rebuild U.S. shipping after German U-boats decimated America\u2019s merchant flee during World War I.<\/p>\n
Among other things, the Jones Act mandates that ships carrying cargo and passengers between U.S. ports must be built in the United States and owned by Americans \u2014 effectively prohibiting foreign-flagged ships from this domestic trade. The vessels are also required to carry U.S. crews.<\/p>\n
The law can be waived in the \u201cinterest of national defense,\u201d the U.S. Maritime Administration notes, either through the Homeland Security or Defense Department.<\/p>\n
The Jones Act also was intended to ensure that the U.S. had its own merchant fleet in case of war. It\u2019s been strongly supported by some U.S. shipping companies, national security advocates and organized labor. But cutting out foreign competition has also driven up the cost of carrying cargo domestically.<\/p>\n
U.S.-flagged ships are generally more expensive to both operate and build than foreign ones. And those costs are especially damaging to states and territories that are supplied by sea, such as Hawaii and Puerto Rico.<\/p>\n
Why is Trump waiving Jones Act requirements now?<\/p>\n
Oil prices have spiked and swung rapidly since the start of the Iran war.\u00a0Nearly all\u00a0tanker movement in the\u00a0key Strait of Hormuzremains at a halt, which has led major oil producers across the Middle East to cut production. Commercial ships \u2014 which, beyond fuel, haul cargo from\u00a0pharmaceuticals to computer chips\u00a0\u2014 have also been stalled at sea or\u00a0faced attacks themselves.<\/p>\n
That\u2019s\u00a0pushing up prices\u00a0for businesses and consumers worldwide. Brent crude, the international standard, was trading at\u00a0nearly $109 a barrel\u00a0on Wednesday, up from roughly $70 before the war began. And U.S. crude is now at about $98 a barrel. U.S. drivers have already seen prices at the pump jump dramatically \u2014 with the national average for regular gasoline topping $3.84 a gallon Wednesday, per AAA, up about 86 cents from before the war.<\/p>\n
All of this has left countries scrambling for more supply and alternative shipping routes. The White House\u00a0confirmed\u00a0last week it was looking into suspending Jones Act requirements, which\u00a0Trump called \u201crestrictive.\u201d<\/p>\n
White House press secretary Karoline Leavitt said Wednesday that the Jones Act waiver would help \u201cmitigate the short-term disruptions to the oil market\u201d during the Iran war and would \u201callow vital resources like oil, natural gas, fertilizer, and coal to flow freely to U.S. ports.\u201d<\/p>\n
Meanwhile, the American Maritime Partnership \u2014 a coalition that represents vessel owners and operators, unions, equipment yards and vendors \u2014 said in a statement that it was \u201cdeeply concerned\u201d about the 60-day waiver \u201cbeing abused and unnecessarily displacing American workers and American companies.\u201d<\/p>\n
The group, which has been a longtime supporter of the Jones Act, also reiterated that the action would do little to reduce gas prices for consumers.<\/p>\n
How could suspending Jones Act requirements impact gas prices?<\/p>\n
A number of factors contribute to prices at the pump. And many note that opening up domestic shipping routes isn\u2019t a sweeping fix.<\/p>\n
The Center for American Progress estimated last week that waiving the Jones Act would decrease East Coast gas prices by a modest 3 cents, but potentially raising costs on the Gulf Coast. And the move \u201cwould also sideline American shipbuilders and workers and allow the oil industry to continue to profit from high prices while reducing transport costs,\u201d the research and policy think tank said Friday.<\/p>\n
The U.S. is looking for additional ways to boost oil supply. Also on Wednesday, the Treasury Department\u00a0eased sanctions\u00a0to allow U.S. companies to do business with\u00a0Venezuela\u2019s state-owned oil and gas company. And the Trump administration has announced it will temporarily\u00a0free up Russian oil\u00a0from U.S. sanctions, too.<\/p>\n
Last week, the International Energy Agency also pledged to\u00a0release 400 million barrels\u00a0of oil available from its member nations\u2019 stockpiles, the largest volume of emergency oil pulled in the organization\u2019s history. Trump, who previously downplayed the need to tap into reserve oil, confirmed that the U.S. would pull 172 million barrels from its\u00a0Strategic Petroleum Reserve\u00a0over 120 days as part of the IEA\u2019s effort.<\/p>\n
Still, analysts maintain this will be a\u00a0short-term bridge. Refineries also buy crude oil in advance, and it takes time for new supply to trickle down to consumers. And, of course, it\u2019s possible the pain of higher prices could increase further if the war drags on.<\/p>\n
The U.S. is a net exporter of oil, but that\u00a0doesn\u2019t mean it\u2019s immune\u00a0to global spikes. Oil is a commodity traded globally. And most of what the U.S. produces is light, sweet crude, but refineries on the East and West coasts are primarily designed to process heavier, sour product. As a result, it also needs imports.<\/p>\n
_______<\/p>\n
AP Writers Seung Min Kim, Paul Wiseman and Collin Binkley in Washington contributed to this report.<\/p>\n
#White #House #suspends #Jones #Act #days #Analysts #gas #price #impact #cents<\/p>\n","protected":false},"excerpt":{"rendered":"
As the U.S. and Israel\u2019s\u00a0war against Iran\u00a0continues to upend\u00a0energy markets\u00a0and\u00a0supply chains\u00a0worldwide, the Trump administration says…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[245],"tags":[3194,1291,4095,3128,518,419,2582,525,4092,376,4094,303,100,1181,2163,2200,4093],"_links":{"self":[{"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/posts\/1743"}],"collection":[{"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1743"}],"version-history":[{"count":0,"href":"https:\/\/stock999.top\/index.php?rest_route=\/wp\/v2\/posts\/1743\/revisions"}],"wp:attachment":[{"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1743"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1743"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stock999.top\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1743"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}