Kemp: US Set To Get More Accurate Oil Production Data
The crisis of 1973/74 had taken a complacent public and politicians by surprise, even though the root causes of the shortages long predated the embargo. Many Americans blamed soaring prices on a perceived conspiracy among the big oil and gas companies to withhold supply from the markets.
"The news media embraced drama rather than facts, and Congress was dismayed to find that the federal government had no independent source of data as a check on the oil industry," Richard Vietor of Harvard Business School wrote later ("Energy Policy in America Since 1945", 1984).
The FEA's information-collection powers were designed to give the federal government its own comprehensive information on the state of energy production and markets.
But the sweeping powers generated an inevitable reaction, especially from small, independent oil and gas producers. In 1976, Congress approved the Federal Energy Administration Act Amendments to curb some of the FEA's authority.
The amending legislation included a new Section 13(h), which stipulated that "the administrator shall take into account the size of businesses required to submit reports with the administrator so as to avoid, to the greatest extent practicable, overly burdensome reporting requirements on small marketers and distributors of petroleum products and other small business concerns".
Form Filling
The legislative history of the information-gathering powers highlights the central tension in accurately measuring energy supply, demand and stockpiles. Truly comprehensive information would require a blizzard of form filling and prompt fierce protests about the burden on respondents.
Like other agencies, such as the Census Bureau, the Bureau of Economic Analysis and the Bureau of Labor Statistics, the EIA relies on sampling and hopes that careful survey design will ensure the sample is representative of the much bigger universe of oil and gas producers, marketers, refiners and pipeline companies while minimising the reporting burden on smaller companies.
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