Impacts of the Jones Act on U.S. Petroleum Markets / Ryan Kellogg, Richard L. Sweeney.

Format:

Book

Author/Creator:

Kellogg, Ryan.

Contributor:

National Bureau of Economic Research.

Sweeney, Richard L.

Series:

Working Paper Series (National Bureau of Economic Research) no. w31938.

NBER working paper series no. w31938

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2023.

Summary:

We study how the Jones Act -- a 100-year-old U.S. regulation that constrains domestic waterborne shipping -- affects U.S. markets for crude oil and petroleum products. We collect data on U.S. Gulf Coast and East Coast fuel prices, movements, and consumption, and we estimate domestic non-Jones shipping costs using freight rates for Gulf Coast exports. We then model counterfactual prices and product movements absent the Jones Act, allowing shippers to arbitrage price differences between the Gulf and East Coasts when they exceed transport costs. Eliminating the Jones Act would have reduced average East Coast gasoline, jet fuel, and diesel prices by $0.63, $0.80, and $0.82 per barrel, respectively, during 2018-2019, with the largest price decreases occurring in the Lower Atlantic. The Gulf Coast gasoline price would increase by $0.30 per barrel. U.S. consumers' surplus would increase by $769 million per year, and producers' surplus would decrease by $367 million per year.

Notes:

Print version record

December 2023.