Axios: Trump Would Like to Keep Jones Act Waiver in Effect
Last month, the Trump administration issued a 60-day waiver of the Jones Act in order to make it easier to move petroleum and fertilizer products between U.S. ports. Availability of foreign tanker tonnage in a tight market was an initial limitation, and uptake was low at first, but in recent weeks about 40 foreign-flagged vessels have moved products in U.S. coastwise trade. Now, the administration is reportedly considering extending the waiver further, according to Axios.
"As long as the Iranians are a threat and raising fuel prices, the president would like to keep the waiver in place for as long as is necessary," an advisor to the president told the outlet.
From the administration's perspective, a waiver reduces friction in the petroleum market at a time of elevated prices. California has received multiple shipments of gasoline on foreign tonnage, and Alaska has reportedly received about half of its monthly jet fuel allotment on foreign tankers - without reaching for imported supplies.
The prospect of a persistent Jones Act waiver is of great concern to Jones Act shipowners, who have spent billions to purchase U.S.-built tonnage and hire U.S.-citizen mariners. The act is essential to the industry's survival, as foreign operators tend to lean into the use of lower-cost foreign labor markets to minimize the expense of their ships and their crews.
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“An extension of the current historically long and broad Jones Act waiver would blow a hole in the Trump agenda to restore American maritime dominance. Waiving the Jones Act exports American jobs to foreign carriers, lets them skirt U.S. laws, and throws open our maritime borders,” said Jennifer Carpenter, President of the American Maritime Partnership, which represents U.S. shipowners. "Any extension would be an affront to hundreds of thousands of hardworking Americans who put this country - not foreign powers - first.”
Initial use of the waiver centered on moving refined products out of the Gulf Coast, but that may be changing. According to Kpler, Phillips 66 chartered a foreign-flagged crude tanker - the Malta-flagged HTM Warrior - to lift U.S. oil from Beaumont and deliver it to Monroe Energy's Trainer oil refinery in Pennsylvania. It appears to be the first such instance since the waiver took effect. Regional crude oil moves of this type are less common on Jones Act tonnage, as the sector is heavily geared towards the movement of refined products (with exceptions on the West Coast).
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