A fuel tanker off Barbers Point, Oahu, on Wednesday.          

Photo by Charley Myers

Institute's JA waiver request for fuel imports goes national

Keli'i Akina writes about it in the Honolulu Star-Advertiser while U.S. Rep. Ed Case of Hawaii sends a waiver request of his own

from Grassroot Institute, March 11, 2022

Hawaii's vulnerability to the suspension of Russian oil imports has caught the attention of the nation.

The Grassroot Institute of Hawaii helped put the nation on alert about the state's reliance on foreign oil even before the state's only refinery, Par Hawaii, voluntarily suspended its crude oil purchases from Russia on March 3, in reaction to the Ukraine crisis.

As Institute President Keli'i Akina stated during a March 4 interview with KSSK morning radio host Michael W. Perry: "Even before the Russian-Ukrainian crisis, we were already vulnerable."

After the oil cutoff, Akina wrote President Joe Biden asking that he grant Hawaii a one-year exemption from the Jones Act for fuel imports, and that further raised Hawaii's national profile. 

On Tuesday, March 8, Biden ordered the suspension of all Russian fuel imports to the U.S., and now the entire country is wondering how the amounts of fuel imported from Russia will be replaced. For the U.S. mainland, the amount is relatively small, but for Hawaii, the imports have ranged from a quarter to a third of all its oil supplies each year.

Par Hawaii has said it will find new sources from "North and South America," but the Grassroot Institute has been saying it would be easier, and probably more desirable from a political standpoint, to buy it from U.S. sources.

Only trouble is: the Jones Act, which requires that all goods shipped between U.S. ports be on vessels that are U.S. flagged and built, and mostly owned and crewed by Americans.

For reasons the institute has thoroughly documented, the Jones Act makes it more expensive for Hawaii to buy U.S. oil than foreign oil, which is why Hawaii imports almost all of its fuels from foreign sources. Furthermore, even if U.S. fuels were more affordable, there are not that many Jones Act tankers available to fill the gap.

So much for energy security. But all is not lost.

In recent days, media nationwide have focused on the subject; U.S. Rep. Ed Case of Hawaii also sent a waiver request to the president for oil imports; U.S. Rep. Scott Perry of Pennsylvania introduced legislation seeking a Jones Act exemption for liquefied natural gas; and legal experts have discussed whether an exemption is possible and, if so, how it might work.

Writing in the Honolulu Star-Advertiser on Wednesday, Akina said, "Obviously, the Jones Act is sorely in need of an update that would bring it into the 21st century. In the meantime, we must address the ways in which it threatens our safety and contributes to the state’s energy woes."

A one-year waiver, he said, would "help mitigate the current crisis [and] … give us an opportunity to evaluate the effects of a Jones Act exemption on the economy and national security."

The saga continues. As of yesterday, the Jones Act lobby jumped into the fray, asserting its intention to "fight back against Jones Act misconceptions" — and, of course, oppose any requests for Jones Act waivers.