EVALUATION REPORT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85-00988R000500030003-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 9
• Document Creation Date: December 14, 2016
• Document Release Date: May 14, 2003
• Sequence Number: 3
• Publication Date: October 15, 1979
• Content Type: FORM

' E t AL USE ONLY , '`NFI
AV EVALUATION REPORT
TO: ? Executive Secretary
SUGGESTION NO.
SUSPENSE DATE
Suggestion and Achievement
79-282
Awards Committee
INSTRUCTIONS: Please complete this form in detail to guide the Suggestion and Achievement Awards Committee in making a final determination of
the merits of this proposal. Retain third copy.
? DECLINE El OTHER (Specify):
ACTION RECOMMENDED E ADOPT
1
.
.
DATE ADOPTED
2. REASONS FOR RECOMMENDATION (If more space is needed, use plain paper)
In order to fully evaluate this suggestion, a vacuum gauge was
installed on an Agency test vehicle and monitored closely for
several days during various traffic situations. The exercise
revealed that during acceleration there is always a decrease in
engine vacuum. The amount of decrease depends upon the suddenness
and duration of acceleration. Maximizing engine vacuum at all
times would therefore tend to increase efficiency of gasoline
consumption. However, there was an insignificant and almost
unmeasurable decrease in gasoline consumption of the test vehicle
during the course of the exercise. This occurred in spite of
concerted efforts on the part of the driver to maximize engine
vacuum at all times, even to the extent that extremely slow
acceleration was necessitated while proceeding uphill.
Our overall evaluation of this proposal reveals that
insufficient benefits exist to justify installing vacuum gauges
on Agency vehicles. Gasoline efficiency may best be obtained by
exercising good driving habits, such as avoiding "jack rabbit"
starts, accelerating and decelerating smoothly, staying within
posted speed limits or existing traffic flows, and by proper
engine maintenance as specified by the vehicle's manufacturer.
OL 9 2295a
3. TANGIBLE FIRST-YEAR SAVINGS (Man-hours, material, equipment, etc.)
4. INTANGIBLE BENEFITS (See guide on reverse side of third copy)
5. WHAT OTHER OFFICES, DIVISIONS, ETC. MIGHT ALSO USE THIS IDEA?
(Use plain paper to continue report, if necessary)
4TE
SIGNATURE OF EVALUATOR (Type name and title)
F I Chairman, Internal Suggestions
Awards Panel, OL
O77 244b EUSE DITION S~~1r9V 0~
~F--I;$?~J?J8J4~~3-2 n SECRET 1431
LAYYI OV
USE ONLY
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EMPLOYEE SUGGESTION NO. 79-282 - REASONS FOR RECOMMENDATION
Although this suggestion is not recommended for
adoption, the suggester's concern for energy conservation
is nonetheless appreciated.
Distribution:
Orig & 1 - ES/SAAC
- OL/P&PS
- OL/LSD
OL/LSD (15 Oct 79)
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InEOpsua~cT.A~ suc~~~~aal.
%-111 i_i ll.~ r: Z c?t:.C@ the national gasoline LET :n - :i: c)Y E' 'c'.UC.7- 1' j f ' i ' Ili.. ibe of miles
?nq_inc intake 21 anlfolc nO
'?:_1o tacuiri Pressure always !Tl'1ximiS`.1) it least l0 ?ocr
cases (riountainous clri i l{?~ clos-,r to 2) p n-rrrn . 1f. r ii?.`ii (or auto
1 ciors) 1 are to install anCi c rive in to such J.!stn-rt n
i_l .G: _`17L pan ,.Z in a loczt.icm hi fr ll.y Vlc:lJ: to ~; n-1 C.i i ~T,? ... :;l l a C~11T1E'CteCI
RESEN METfiQD ~ ;'t e +;: .a 1
,FV 7 ' +!c;o1 7n . ';11'.'r' cIriver#
suggestion r.-_xt_r s to 1 ~c ri c _ c~ who
to ^ 1ve gasoline shout: --,2-ply 1T1st t1_i 1n.`.?. a vac un c't uce oii 1^-.i..1:' au~t0
If this suggestion can be giv n (Such as =41t be
SUGGESTI(~NN~J9~
t r:~~?at o the driving oiiolic wouldl wor- to r_ i--j it out. Just tha cr'ncep)t of a
,` 1~_yr v i si b e reminder of gasoline constnq~tion would. have an ecxmcxni incr e f.. ct on many
RM 24t USE PREVIOUS
3/76) EDITIONS
3 SECRET
^ CONFIDENTIAL
ADMINISTRATIVE
^ INTERNAL USE ONLY
Approved ~ 2003/6/2 CAA
0
E IMPDET CL BY__
^ UNCLASSIFIED
 M UNCLASSIFIED
^ U S iv ^ CONFIDENTIAL SECRET
o UTIING AND RECORD SHEET
T
SUGGESTION AND ACHIEVMN'
AWARDS COMMITTEE
915 Al ES BUILDING
TO: (Officer designation, room number, and
building)
f a. L - C PES-E ETABY
SUGGESTION AND ACHIEVEMEN
AWARDS COMMITTEE
OFFICER'S
INITIALS
COMMENTS (Number each comment to show from whom
to whom. Draw a line across column after each comment.)
What does OL think?
Should we send DOE?
00300P2 UNCLASSIFIED
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V
THE BOSTON SUNDAY GLOBE
23 September 1979
CPYRG
T
3 i i 1 i a ; 3 a vn:;
If lj~~ -11 1_3
3-1 Fred 1 C. ok
he great "oiloil crisis" of tote'
.
petrated a helpless ess people.
The truth is that there was no shortage of
oil.
President Carter's Sermon on the.
Mount. on Sunday night,. July- t5,?ignored
the fraud. He insisted that the shortage
was "real." To have admitted that it was.
not would have entailed an admission of
the culpability of Big Oil and at President
Carter's own recumbent Department of
Energy (DOE). The naive may say to themselves;
"Why, this cannot be." So let's begin by
citing some sources:
A Federal Trade Commission study
plies were up from 4 to 3 percent-(depend
Ing on the.month in which- the-cemparisoti
.was made) during, the first four months of.
1979 over the comparable period in 1973.
A US Customs figures, independently
verified by House. of Representatives
researchers, show that the "Iranian short
fall" s4wideiy trumpeted to validate the
"crisis' was a red herring, because im-
ports,of oil during the first five.mgnths of..
1079 actually -increased' W percent over--
A world energy assessment by the
Central Intelligence Agency, shows. that.
world oil production in the-:first quay
of 1979 was:up despite the Iraniaadisrup
tion; that US imports, through May
showed a big increase over 1973 figures.-
and that American firms; in this very:
time of supposed- crisis were actually ex=-
porting_ore: oil thanthey,,hadin 1978'
L.et's ' explore some `of j this dJ to iiz.
greater depth before getting into the
questions of hover and why the nation was
thrown. into. chaos- with g= lines some='
times miles long: with truckers staging-'a;
nationwide protest against the high price
and scarcity of - diesel fuel; with some.,
farmers plowing under crops because'
they could., not get-trucks:--to-transport A
them.. `..
Approved
down in history as one of the.
per -
greatest frauds ever
When President Carter came down
from the Mount, he thumped the table in
the Oval Office and announced that he,
was not going to. permit the. importation
of a single gallon of oiI.more than we had
` imported in 1977. What -the public and
practically all of the commentators didn't
know-was that we imported so much. oil in
1977 that Big Oil suffered acute glut pains
and couldn't get those damned prices up.
The' American Petroleum Institute is
the official spokesman for the industry.
Its figures are accepted without question
by- the Department of Energy because
they are the only figures the DOE has.
Other sources suspect that the Petroleum
Institute's statistics often gild the lily for
Big' Oil, which is only to be expected.
However, with this caveat, look at what
the industry's own figures show: Total
crude oil stocks in millions of barrels at
year's end 1977 reached 339.859, a 19.1 per-
cent increase over 1976. At year's end
1978, total stocks had dropped to 314.462, a
decrease of 7.5 percent, bringing us into
1979 with a potentially short situation.
But, as in almost every facet of this
story, things weren't what they seemed.
In. addition to the normal crude oil sup-j
plies, the federal government has estab-I
lished a Strategic Petroleum Reserve. Into
this reserve; stored in salt domes in Loui-
siana,-. it has poured literally billions of
gallons of imported oil; and the Depart-
ment of Energy, with its usual efficiency,
has. dumped all that oil into the caverns
without thinking about installing pumps.
To get it out.
If one includes the extra millions of
barrels thatwere committed to this stra-
tegic reserve in 1978, the figures on the
.nation's total petroleum stocks, expressed
in millions of barrels, read- this way:.
381.322 at end of 1978 compared with
347.689 at the end of that 1977 "glut" year.
In otherwords, the nation came into 1979
with 9.7 percent more crude stocks on the
market and in the reserve than it had had.
at the. stare of 1978;. when the industry
was moaning because it had so much oil it.
couldn't even get gasoline prices up to the-
permitted ceilings. -. _:. -
It is enough to make one ask; "What-
the devil goes on here?" `.'that went on is-
For Release 2(*3,I0 9L,s,G.hA.7paDPn ~5-LQ;Q9l+
would expect to get a straight answer-
from Dr. James R. Schlesinger's Depart
ment of Energy.
In January and February 1978, when I
first began to poke my nose into the , .;
situation, I was intrigued and angered
the- fact that No. 2 home-heating oil,
which for at least half a century has been
one of the cheapest products of the refin-
eries, was selling at prices that made it
more expensive than the more highly :,-
fined regular gasoline, once one discount-
ed 12-cent-a-gallon state and federal taxes
on gasoline.' -
My inquiries brought the reply from
industry sources and from the DOE
through my congressman that there was
virtually a price war on for gasoline be-
cause there was so much of it. Heating oil,
however, had been decontrolled in : ,e
last days of the Ford Administration; tht
homeowner, anchored in place by his :Lr-
nace, couldn't shop around - and so ie
was-zapped. -
Given this untidy situation, Big ^i.
drew down stocks during 1978 and by late
fall had created a situation in which there
began to be alarming talk of. shortag'_s
Shell Oil led the way, imposing drastic
cuts on the delivery of gasoline to is
retailers; Mobil, Citgo, the whole- :r iet?
fell into line behind the force:piay. ?eta;,
gasoline dealers roared their outrage:
there was a nasty flareback of damaging
publicity; and, the big oil companies
backed off for the moment, restoring ,ie-
liveri4s to nearly normal.
Then,, heaven sent, came the Lran:an
revolution; which' closed down the .;,1
fields. The myth of the"Iranian shor fall"
was born. Actually, only 5 percent of our
imported oil came from Iran, and this
shortage was quickly offset by'steoped-ur
production in Saudi Arabia, increase?
Alaskan supplies and lesser '.increases
from other-sources. - -
CIA figures show that Free World pro-
duction expressed in thousands of barrels
daily, rose. to -6,515 in the first quarter of
1979 compared with 46.305 in .1978. Cus-
toms figures, as recorded by the Census
Bureau, show that -imports through May
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ncreased 10 percent over those for the
first five weeks of 1973. Indeed, the .n-
ports for these first five months of 1979
almost matched the levels established in
tr. : ear of 1977.
T`t,e CIA in-depth study echoed the
Customs Services findings. It showed im-
ports in the first five months of 1979
out:.=.ripping those of 1978.
The CIA assessment revealed another
c.irnous fact. In this 1979 year of "crisis,"
American firms actually exported more
chi in every one of the first five months
than they had in either 1977 or 1978. Ex-
ports ranged from 329,000 barrels daily in
January to 445,000 barrels daily in both
April and May. Yet in lush 1977, exports
had ranged from only 192,000 barrels daily
to 2_88,000. . .
The fact that we were actually export-
ing more oil in 1979. than we had in the
two previous noncrisis years would seem
to indicate manipuation of the market.
This suspicion, shared by more than two-
thirds of the American people, according.
to public opinion polls, is reinforced when
one reads the Federal Trade Commission
memo of May 30. - .
Reporting on a study. made by the
commission's staff, the memo said: '"The
data indicates, among other things, that
gasoline supplies in. 1979 were up by-"
percent, depending on the time period,
over 1973's. Net supply of gasoline in
April was particularly plentiful compared
to the previous April (up by 22.9 percent).
Significantly, however, every time period
month, ouarter, third - shows in-
creased sdoplies and no indication of a
shortage."
Yet it was in late April and early May
that the gasoline pumps in California
suddenly went dry, beginning the
drought that was to spread across the na-
tion to New York, Washington, D.C., and
cities in between. In a nation whose
whole economy since World War II has
been structured around networks of su-
perhighways on which federal and state
governments have lavished billions of
dollars, panic. struck, accompanied by_
frustration and fury.,
The evidence establishes that none or.,
this was necessary; it suggests that this
was a "crisis" carefully orchestrated by
Big Oil, aided and abetted by- the compla-
cent non-watchdog in the DOE. And even.
by President Carter himself - a Presi-
dent who has in his public pronounce-
ments consistently followed the line set 11
down by Big Oil.
. Jack Anderson, the Washington. col-
umnist, has published excerpts from se-
cret White House minutes indicating that
President Carter deliberately cuc back
gasoline supplies to 'keep his pledge to
ocher industrial nations that the United
States would reduce oil consumption by 5
percent. At a May 7 meeting, just as mo-
torists were queuing up for miles in Cali-
fornia, Carter told his Cabinet: "Our pri-
ority will continue to be some heating, ag-
riculture and emergency needs over
highway driving ... There will be less
gasoline, and it will cost more." Those last
words confirm Jack Anderson's scoop.
They match word for word the public
Presideetial refrain that all of is have)
heard for months: "There will be less gas-
oline, and it will cost more."
Cost more! That is what this scenario
is all about. The Carter Administration
for months has backed every move that
would make gasoline and other fuel prod-
ucts more costly, on the theory that high-
er prices would "force" conservation. For
months; the Administration talked about
-$l-a=gallon gasoline. Privately, it was
scripting an even more brutal program.
Jerry Ferrara, the outspoken executive
director of the New Jersey Retail Gaso-
line Dealers Association, described in a
television appearance on July 2-how he
and his associates had "pounded on every
door" in Washington seeking the adoption
of a more sensible policy. He said he had
met face to face with Dr. Schlesinger, and
he added: "He (Schlesinger)' said that if
gasoline got up to $1. a gallon by 1981, the
American people would have to conserve.
And then he walked out of the room."
Virtually every tactic imaginable hash
been employed by the oil companies to
generate the atmosphere of shortages andi
crisis that would open the floodgates of
price. _
One of the most ingenious involved
-the stockpiling of crude and finished
products on tankers dawdling at sea.
Spokesmen for the maritime workers who
man the tankers aver that big oil compa-
nies sent out word that their tankers-were
to steam at no more than 10 knots instead
.of the 16 to 17 they are capable of doing.
"When tankers are reduced to 10 knots,"
one maritime spokesman says, "a voyage
from Beaumont, Tex., to Boston that
would usually take five days stretches out
to nine. And when you have whole fleets
of tankers out there, loaded with hun-
dreds of thousands of gallons each, you
are stockpiling a lot of stuff on the high
seas." Not until the middle of June, anoth-
er maritime spokesman says, did "one ma-
jor oil company reverse its orders" and let
its tankers steam at 16 to 17 knots. -
The stall at sea has been matched oy
stalls in tort. Turnaround tame in port.
which used to take from 1S hours to }^=
day, now frequently stretches to two or
'. o and a hail as s. ;tretines.;e:inertes
say they have no cargo ready to shit,.:..
other times ships loaded with relined
products come into port and find stora;-
tanks so fiul that there, is no way to
unload.
The stockpiling at sea and the delays
in port are just a couple of the ploys that
have helped to produce the oil panic tf
1979. The oil industry, it would appear,
had a couple of other even more impor-
tant maneuvers up its sleeve. Justice De-
partment anti-trust lawyers have been
,trying to find out why it was that just at I
this time of supposed shortages, domestic
crude oil production in the fnite&States
.went into its steepest decline in, seven
years. In a preliminary and relatively un-
noticed report, justice Department attor-
neys concluded that, from December!
through April,. the falloff in domestic
drilling had cost the nation some 11 mil-
lion barrels of gasoline. Since there are 42!
gallons to the barrel, that represents a lot
of gasoline. This falloff in domestic pro-
duction came at a time when oil company
profits in the first quarter of 1979 were
going through the roof.
While the companies were demano:.-,g
price decontrol as a prerequisite for in-
creased domestic production, first quarter,
profits at Exxon were already up 37 per-
cent: Gulf's were up 61 percent and other
majors like Standard Oil of Ohio were registering increases of more than 300 per-
cent.
The drop in domestic drilling was ac-
companied by a second cutback, a reduc-
tion of refinery output. "That is where t
all hangs out," one industry critic says. does indeed. -
Refineries capable of operating at J ,
92 percent of capacity (this is, virtua:,y
full-out considering inevitable mainte-
nance delays) dropped their runs in t^.;
season of our travail to a bare 84 percent. !
The American- Petroleum Institute itself
acknowledged that, in the second wean of'
June, refineries were operating at only
84.1 percent of capacity. The following
week, the runs were stepped up to 34.5
percent-still . far below capacity at a time
when, all reliable evidence shows, crude
stocks were in plentiful supply, waiting to
be processed. -
O
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Ion in late spring :y i3, has jumped in a
year to more than ! cents, with the pros-
pect that it will o.- -Priced at between 80 1,
and 90 cents this e~t..,io s 'winter. Regular
i
gaol..te, which as late as 7ebruary was
selling at 599 cents (only a few cents
more than untaxed heating oil), now sells
for from 39.9 to 91 cents. Unleaded and
super-unleaded (the latter needed in
many cars to avoid damaging knocks
from low-octane unleaded) have zoomed
in price at some stations to $1.45 or more.
This brutal escalation, which puts Dr.
Schlesinger's $2 gasoline in our immedi-
ate future, has been achieved through the
delightful collaboration between Dr.
Schlesinger's DOE and the oil industry.
All during 1978, when the gas glut
made it impossible to sell gasoline at ceil-
ing prices, individual gas station owners
were allowed to "bank" the differential
on their records. Came 1979, the "short-
age," zooming OPEC prices; and, with
frustrated motorists on' gas lines willing
to pay anything, those deferred, spurious
"banked" sums were tacked onto the al
ready zooming prices. As usual, the con-
sumer got zonked .
The DOE has now ended this banking
system, but prices have already been driv-
en to levels from which it is almost cer-
tain they will never come down.
Summing it all up, one analyst in
Washington observed: "The Department
of Energy must be either the most stupid
or the most influenced department the
federal governemnt ever created. The
only thing is, you would think that if they
were just being stupid, they would make
a mistake once in a while in favor of the
consumer. But they never do."
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~ o
-'=D THE WASH! G T ON POST
Ott PAGED 22 September 1979
11
lexleo
ecord ion
atural Gas
By J. P. Smith -
Wasainnon Post Mail writer
Breaking a nearly two-year-old deadlock, Mexico
and the United States have agreed on a natural
gas sale that could improve relations between the
two countries and open the way for increased, Mex-
ican oil exports in the future.
While the amount of gas Mexico will be selling
to the United States is small-only about half a-
percent of total consumption-President Carter
said yesterday it represented a breakthrough in
often-strained relations-between the two nations.
He also said it is "a significant step toward pro-
viding a new energy source for our country."
The agreement was reached- yesterday in Mex-
ico, capping six months of difficult and frequently
interrupted talks.
Deputy Secretary of State Warren Christopher
yesterday told reporters that the United States
V,ould pay $3.625 per thousand cubic feet for 300
million cubic feet of natural gas a day.
The price is the highest anywhere in the world
fc- pipeline gas, though Assistant Secretary of.
Sate Jules Katz told reporters that because the
amount of gas involved is so small, the effect on
consumer prices will be "hardly noticeable." Once
the gas starts flowing, it will amount to only 8.
percent of the"United States' total gas imports.
However, the two nations- also agreed to- tie the
price to the quarterly increases in world crude oil
prices. And the parties agreed that either may can-
cel the deliveries on 18a days?_ notice::
CPYRG
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Christopher told reporters at a Waite House
briefing that the gas deal was unrelated to Presi-
dent Jose Lopez Poitilio's scheduled state visit
next week.
In recent weeks, however, senior administrat_on
officials have been saving in private that Carter
had asked State and Energy Depart-meat negotia-
tors to move aggressively to get a deal before Lo-
pez Portillo's visit.
Earlier this year Caner and former energy sec-
retary James R. Schlesinger drew heavy fire from
Congress for not completing the gas pact with
In Mexico City yesterday. a high-ranking Mexi-
can official told Washington correspondent Marlise
Simons: "-We got an agreement because the U.S.
suddenly agreed to our final offers. It was as sim-
ple as that.. We are very pleased--
The price Mexico will receive for its gas is the
equivalent of $21-a-barrel crude oil but significant-
ly less than the price of liquefied natural gas.
which is more expensive by a dollar or more per
thousand cubic feet.
One almost certain outcome. of the deal with
Mexico is that Canada, which now supplies the
United States with significant amounts of gas. will
raise its prices to match the Mexican price. Earlier
this year Canada was selling its gas to U.S. pipe-
line companies at S2.l6 per thousand cubic feet,
but last August the price was raised to -3.30.
U.S. officials have said recently that they expect
Ottawa's National Energy Board to boost Canada's
prices to $3.30 per thousand cubic feet or more by
January.
Christopher and other U.S. negotiators, includ-
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?
Katz. stressed that the Lni.ted
States and Mexico have ne_otiated -a
frarnewor'.;." and that the actual sale
will depend upon further details to he
negotiated between the pipeline com-
panies ar.d Petroleous '.lexicanos
(Pemex). the Mexican state oil monop-
oly.
The agreement will not require the
construction of a new pipeline. U.S.
officials, however. say that if the
amount of deliveries is increased
sharply. Mexico will have to increase
pipeline capacity.
The consortium of companies that
will take delivery of the gas initially
signed an agreement in August 1977,
but that deal was rejected by Schles-
inger because the administration be-
lieved the. price was too high. -
Under the 1977 pricing formula, the
gas would now be flowing across the
border at nearly $j per thousand cu-
bic feet.
The consortium is led by Tenneco
and Texas Eastern Transmission, and
includes Southern Natural Gas, El
Paso Natural Gas, Florida Natural
Gas and Transcontinental Gas. ' -
There have been seven negotiating
sessions on gas since Carter's Febru-
ary visit to Mexico. The United States
at first demanded that the price be
tied to America's domestic inflation
rate, not to world oil prices.
?
llexico wanted prices linked to 7e-.)
troleum product prices, such as those
inc middle distillate (heating) oil.
By Thursday both sides agreed to
peg prices to a composite world. crude
0;1 trice. details of which still have to
ne worked out by Pemex and be com-
panies.
Another sticking point in the talks
was Mexico's desire for an agreement
that would allow Pemex to cancel de-
liveries on short notice.
U.S. officials stress that the cas
sale depends upon how Iona -,Wex:co
continues to have a gas surplus. Un-
der the a reement, Mexico is ex-
pected to earn about .Si million a day.
Unlike those in most oil exporting
countries. Mexico's oil fields contain a
high percentage of so-called-"associ-
ated gas"-gas that is in effect pro-
duced along with oil. Petroleum engi.
neers and the Library of Congress
have argued that providing Mexico
with an incentive to produce gas
would be to G.S. advantage, becuse it
would encourage increased oil produc-
tion as well.
i\Iex co exports nearly a million bar-
rels of oil a day, most of which flows
to the G.S. market.
Central Intelligence Aaencv studies
say that ..iexico could boost its on ex-
irts o.- as much as lour Trillion :o
six million barrels a day during the
1980s.
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