Boston College Environmental Affairs Law Review Boston College Environmental Affairs Law Review

Volume 3 Issue 3 Article 2

1-1-1974

Resource Recovery and U.S International Trade: The Case of Resource Recovery and U.S International Trade: The Case of

Waste Oil Waste Oil

Ingo Walter

Sonia P. Maltezou

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Recommended Citation Recommended Citation Ingo Walter & Sonia P. Maltezou, Resource Recovery and U.S International Trade: The Case of Waste Oil, 3 B.C. Envtl. Aff. L. Rev. 433 (1974), https://lawdigitalcommons.bc.edu/ealr/vol3/iss3/2

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RESOURCE RECOVERY AND U.S. INTERNATIONAL TRADE: THE CASE OF WASTE OIL

By Ingo Walter* and Sonia P. Maltezou**

The international economic implications of environmental man­agement have in recent years come under increasing scrutiny. The principal focuses for analysis have been the volume, direction and product-composition of international trade; possible commercial and financial policy reactions; patterns of industrial location; and international flows of direct investments.)

Largely ignored thus far are the implications of environmental management of international trade in waste materials, which al­ready seems to be of considerable significance and is growing rap­idly. This article addresses itself to this issue, with specific reference to the recovery of waste oil, as viewed from a national perspective. Waste oil is used as a case in point both because the environmental damage due to improper disposal is relatively great, and because the energy crisis of 1973-1974 has served to shift dramatically the eco­nomic incentives for re-use,

I. TRADE IN RECOVERED MATERIALS

A "bundle" of identifiable recovered materials was selected from the Standard International Trade Classification (SITC) 4-digit product-breakdown, composed of 11 groups: reclaimed rubber (231.3), waste and scrap of unhardened rubber (231.4), paper waste and old paper (251.1), silk waste (261.1) wool waste (262.9), cotton waste (263.3), waste materials from textile products including rags (267.0), iron and steel scrap (282.0), nonferrous metal scrap (284.0), acid oils and residues (231.3), and improved or reconstituted wood (631.4) .

Textile wastes and metal scrap were the only product-groups being imported or exported by the U.S. in 1956, but by 1970 their share had declined to 85% for exports and 75% for imports. U.S. trade in recovered materials was thus spreading into the remaining product-groups identified above, particularly paper and wool wastes

433

434 ENVIRONMENTAL AFFAIRS

on the import side. U.S. exports of recovered materials increased from $404 million in 1956 to $716 million in 1970, while imports rose from $56 million to $131 million during the same 15 year period. The export/import ratio thus declined from about 7:1 to approximately 6:1, but exports of recovered materials were still in excess of im­ports.2 With its rapid growth and diversification, U.S. trade in re­covered materials in 1972 accounts for about 36.5% of exports, but only about 5.6% of the imports of all OECD countries combined.

Table P gives an impression of the relevant trade flows between major importers and suppliers. First, trade among the European Community members is clearly intensive, perhaps due to the mod­erate transportation distances involved and historical supply rela­tionships. Second, Germany is a major factor on the demand side for virtually every product-group. This might be ascribed to exten­sive experience in working with recovered materials during wartime and postwar years of scarcity. Third, U.S. supply patterns are ori­ented toward Canada, while Japan's are oriented toward the U.S. Fourth, the less developed countries (LDCs) playa relatively minor role in recovered-materials trade, except as suppliers of cotton wastes and nonferrous metal scrap.

As virgin materials become increasingly scarce and costly; as technological advances increase the feasibility of large scale materi­als recovery from municipal wastes, sewage, industrial atmospheric emissions and liquid discharges; and, as parallel advances are made in collection and distribution systems with favorable economies of scale; trade in recovered materials can be expected to grow rapidly. Principal sources of tradeable recovered materials will be high in­come countries, which may be presumed to generate the basic wastes in general proportion to levels of consumption and industrial production. These same countries will also be the major forces on the demand side, and hence we can expect recovered materials trade to concentrate among the industrialized countries.

Trade in recovered materials makes a great deal of sense from an environmental standpoint by closing the use-reuse materials flow loop; thus reducing depletion of virgin resources and associated en­vironmental damage. Whether this loop is national or international is immaterial from an environmental standpoint. It does, however, have an important bearing on international commercial and finan­cial relations. Economically, it may influence the structure of trade and competitive advantage and thereby trigger governmental mea­sures in the commercial policy sphere (e.g., embargoes on exports of scrap metal). Moreover, the balance of payments may be af-

WASTE OIL

TABLE I

Principal Importers and Suppliers of Recovered Materials, Ranked by Importance, 1970

Principal Principal Product Group Importers Suppliers

1. Reclaimed rubber (231.3) Germany EC France EC

2. Waste & Scrape of unhardened rubber (231.4) Germany EC

3. Paper waste & old paper (251.1) Germany EC/Eastern Europe Italy EC/Eastern Europe Japan US France EC U.S. EC/Canada

435

4. Silk waste (261.1) Germany EC/Japan/Eastern Europe Japan U.K. Italy Eastern Europe

5. Wool waste (262.9) U.S. U.K. Italy EC Germany EC

6. Cotton waste (263.3) U.K. LDC/US/EC Germany EC/LDC Japan LDC France EC

7. Textile wastes (267.0) Italy US/EC France EC/US Germany EC/Eastern Europe U.S. EC/Japan U.K. EC/US

8. Iron & steel scrap (282.0) Japan US Italy EC Germany EC France EC U.S. Canada

9. Nonferrous metal scrap (284.0) Germany EC/US Italy EC/US Japan US/LDC U.S. Canada U.K. EC/US/LDC France EC

10. Acid oils & residues (431.3) Germany EC Italy EC U.K. EC/US

11. Improved or reconstituted wood (631.4) U.K. EC/Eastern Europe

Germany EC France EC

EC = European Community

436 ENVIRONMENTAL AFFAIRS

fected. An impact here directly impinges on national fuel policy. The link can be made clear by discussing waste-oil recovery.

II. WASTE OIL PROBLEM

A significant cause of environmental despoliation is the disposal of waste oil deriving from personal, industrial and transportation sources. Once lubricating oil has served its purpose, it becomes a serious pollutant if discarded into the environment. Waste oils are not readily biodoegradable because of the inherent thermal and oxi­dation stability of the contained hydrocarbons, and the resistance of certain oxidation-inhibitors intended to minimize oxidation dur­ing use.4 It is estimated that of the approximately 53 million barrels of lubricating oils and greases sold annually in the U.S.,5 50 to 70 per cent becomes waste. 6 Of this waste oil, only 25 per cent is recy­cled.7 The remaining 75 per cent of waste oil is either used with or without minimal cleaning as a burning agentS or is disposed into waterways directly or through municipal and regional sewer sys­tems. 9 Contamination of ground water is also a serious problem in areas where waste oil is simply dumped. 10 While such stationary sources of waste oil contamination of the environment may be quan­titatively most significant,l1 a great deal of attention has also been focused on oil pollution involving flushing of tanks at sea or barging oily wastes. 12 Elimination of this practice through national and in­ternational regulation will in tum necessitate adequate onshore oil residue reception facilities. 13

Environmentally sound disposal of waste oil has thus become a subject of broad concern, particularly in areas of high population and industrial concentration. Recycling of the waste oil appears to be a sound solution, from an environmental point of view. Two sets of issues are involved. The first concerns the process of collection. The incidence of environmentally acceptable collection-and, con­versely, the incidence of environmentally damaging disposal­depends on the average transportation costs between collection points and the reprocessing facility. Insofar as the geographic dis­tribution of waste-oil sources tends to be widely dispersed, and the principal source (e.g., filling stations) tend to generate relatively small quantities of waste oil per unit time,14 the economic value of the transportable water is relatively low. Hence the importance of transport economics and logistics. The second set of issues focuses on the reprocessing operation itself. The number of refineries is decreasing primarily as a result of: (1) antiquated equipment; (2) increases in additives;15 (3) insufficient scale; (4)

WASTE OIL 437

non-availability of collected waste oil; (5) laxity or absence of gov­ernmental regulations that will bring the collectors' oil to a re­refining outlet; (6) an adverse ITC regulation that requires the labeling ofrecycled oils as "Used Oils;" and (7) a tax structure that eliminates any competitive edge fr<1m the recycled oils over virgin oils. Nevertheless, the few remaining re-refineries in the U.S. are producing small quantities of high-quality, saleable lubricating and fuel oil. The future, however, may be brighter for the industry: newer re-refining technologies are becoming available and offer larger profit margins for re-refiners.16

The energy crisis of 1973-74 fundamentally altered the economics of waste oil recovery. The average net price of internationally traded crude oil-composed of tax-paid company-owned crude and "roy­alty" crude sold by governments on the open market or repurchased by the major" oil companies-which stood at $2.70 per barrel at the end of 1972, stood at $9-10 per barrel early in 1974. What seems likely to emerge is a price of perhaps $8.50 per barrel in 1974 dollars, which will rise roughly in proportion to inflation in the industrial countries, perhaps 5-8 percent annually over the next five years. This four fold rise in the price of crude oil implies a corresponding rise in the value of waste oil, against which the costs of collection and reprocessing must be measured.

The principal problem remains the collection of waste oil and its ultimate delivery to a recycling plant. A number of studies have focused on this issue on both the regional and the nationallevelY One question is whether tax-rebates, bounties or other incentives, combined with emission and effluent regulations and/or taxes, may be required-even in the face of sharply higher crude oil prices-to ensure greater re-use and reduced environmental damage. IS

The magnitude of the problem is indicated in Table 11.19 Of the 53 million barrels of lube oil sold in the United States in 1972, adjusting for losses in combustion and leakage, it is estimated20 that between 50 to 70 per cent of this amount is collectable-in the range of 26-37 million barrels annually at 1972 consumption rates. This recoverable base grew at an average annual rate of 1.8 per cent during the period between 1965-72.21

If all of the recoverable waste oil were re-refined to lube oils, the potential net output is estimated to be between 50% and 60% by volume although newer technologies allegedly produce a 70% to 97% maximum yield (after water removal).22 The residuals vary accord­ing to the process used and represent tars, metallic bottoms which are marketable,23 and other heavy substances that are converted

(1) (2)

Domestic Sales of Lube Oil

Year 1,000 bbl

1965 47,120 1966 48,949 1967 44,123 1968 48,467 1969 48,782 1970 49,693 1971 49,321 1972 52,801

TABLE II

u. S. Sales of Lube Oil and Estimated Recovery Rates, 1965-72

(3)

Average Range of Waste Oil Recoverable A B

50% Waste 70% Waste

23,560 24,475 22,062 24,234 24,391 24,847 24,661 26,401

1,000 bbl 32,984 34,264 30,886 33,927 34,147 34,785 34,525 36,961

(4)

Average Range of Waste Oil Convertible into Lube Oils

A B 50% of Col 3A 60% of Col 3B

11,780 12,238 11,031 12,117 12,196 12,424 12,331 13,201

1,000 bbl 19,790 20,558 18,532 20,356 20,488 20,871 20,715 22,177

(5) Average Range of Waste Oil

Convertible into Heating Fuel A B

70% of Col. 3A 80% of Col. 2B

16,492 17,133 15,443 16,964 17,074 17,393 17,263 18,481

1,000 bbl 26,387 27,411 24,709 27,142 27,318 27,828 27,620 29,569

Column 2: U.S. Bureau of Mines, Department of the Interior: Mineral Industry Surveys (Final Summaries of 1966, 1968, 1969, 1970, 1971, 1972 Column 3: This range reflects the average of various estimates of the waste generated by automotive and industrial oils (see footnote 4).

WASTE OIL 439

into carbon. 24 Using the more conservative estimate, this would pro­duce 13-22 million barrels of new lube oils annually at 1972 rates. Alternatively, if all recoverable waste oil were re-refined into heat­ing oil (with similar but smaller quantities of residuals) the yield with conventional technology would be 70% to 80%, or 18-30 million barrels. While the recovery rate for heating oil is greater than for lube oil, this alternative has not been appealing to re-refiners in general, due to the lower prices and profit margins obtaining in that sector.25

III. U.S. IMPORT TRENDS

American imports of crude oil and re-refined products are growing rapidly. Crude imports grew from about 500 million barrels in 1965 to almost 900 million barrels in 1972, despite import quotas. 26 Ex­penditures on crude imports grew somewhat faster-from $1.1 bil­lion in 1965 to $2.4 billion in 1972-due to a consistent rise in the average price per barrel of crude. The dramatic oil price increase of 1973-74 would have raised the level of U.S. expenditures on crude imports to $7.6 billion in 1972. With crude prices expected to rise roughly in line with price levels in the industrial countries, these expenditures will grow still further, although physical volumes of imports may ease somewhat as overall consumption is reduced. The proportion of foreign crude used by U.S. refineries, which rose from about 14 to almost 20 percent during 1965-72, may thus be expected to decline somewhat in the years ahead, perhaps after rising in the intermediate term.

Assuming that the share of foreign crude in total U.S. crude con­sumption also applies in the production of individual petroleum products-as no data are available on the differentiation between foreign and domestic crude once they enter the refining process, and all crude imports are used up in that process-about 12 million barrels of lube oil were produced from foreign crude in 1972, with a crude. import value of about $33 million. When added to direct imports of lube oils and greases, the total import bill was $33.6 million in 1972 (see Table III).

Under the same assumption, the imported crude content of U.S. heating oil production in 1972 was 237 million barrels valued at $626 million. When added to $1.9 billion in direct imports of heating oil, the estimated total import bill for heating oil in 1972 was slightly over $2 billion, as Table III shows.27 The import bill for lube oil and heating oil rose rapidly during 1965-1972, with the latter almost doubling over this period of time. Even these values would have

TABLE III ..... ..... u.s. Direct and Indirect Balance of Payments Cost of Lube and Heating Oil 1965-1972 0

(1) (2) (3) (4) (5) (6)

Value of Value of Lube Oil Produced from Heating Oil Produced From Imported Imported Total Total

Year Foreign Crude Oil Foreign Crude Oil Lube Oil Heating Oil Lube Oil Heating Oil

1,000 bbl $1,000 1,000 bbl $1,000 $1,000 $1,000 $1,000 $1,000 t.lj

1965 8,621 19,225 141,608 315,786 498 716,723 19,723 1966 8,438 18,986 135,279 304,378 536 757,138 19,522 1967 7,395 16,787 123,164 279,582 641 785,590 17,428 1968 8,145 18,326 138,283 311,137 743 864,147 19,069

1,032,509 Z -< 1,061,516 -~ 1,065,172 0

1,175,284 Z 1969 8,656 19,736 147,998 337,435 1,860 917,931 21,596 1970 8,074 19,055 140,686 332,019 3,180 1,085,354 22,235

1,255,366 ~ 1,417,373 t.lj

1971 9,690 24,419 175,441 442,111 592 1,212,329 25,011 1,654,440 Z 1972 12,351 32,607' 237,181 626,158' 988 1,424,702 33,595' 2,050,860' ..-3

> ~

, $104 million at 1974 prices. , Slightly over $2 billion at 1974 prices. >

~ " About $108 million at 1974 prices. , Slightly under $6.6 billion at 1974 prices.

~ > -~ W

WASTE OIL 441

been much higher had 1974 prices obtained in 1972-almost $7 bil­lion for both heating and lubricating oils.

U.S. exports oflube oils have been somewhat larger than imports. They stood at 15.8 million barrels valued at $185 million in 1965, and declined steadily in volume during the period 1967-72 to 13.9 million barrels valued at $165 million in 1972. Exports of heating oil likewise declined from 19.4 million barrels in 1965 ($49 million) to 11.8 million barrels in 1972 ($33 million). Subsequent to the oil crisis of 1973-74, however, these exports are likely to become negli­gible, except for offshore refining.

IV. WASTE OIL RECOVERY AND TRADE DISPLACEMENT

The estimates for waste oil recovery presented in Table II clearly have positive implications for U.S. expenditures on oil imports. The question is whether or not the possible import savings are signifi­cant. Column 1 of Table IV28 assumes that all collectable waste oil is re-refined into lube oils, in which case the crude-content value of the output is $35-59 million at 1972 prices and about $112-189 mil­lion at 1974 prices-the actual market value of the output in 1972 was roughly $161-270 million based on an average export price of $12.17/bbl.

Column 2 of Table IV assumes that all collectable waste oil is converted to heating oil, yielding a crude-content value of $45-72 million at 1972 prices and $144-230 million at 1974 prices and a slightly higher value in terms of prevailing heating oil prices. The potential import-saving is estimated for 1972 to be 2.9-3.5 per cent of the total U.S. heating oil import bill. For 1972, the import savings amount to about 1.9-3.0 per cent of the overall crude oil import bill. These relative values, of course, are the same whether 1972 or 1974 crude oil prices obtain.

CONCLUSION

Closing the gap between the use and re-use of renewable and non­renewable materials makes both environmental and economic sense. To the extent that such materials enter the channels of inter­national trade, resource-recovery may serve as an import-displacing or export-expanding factor. In the case of waste-oil recovery, the likely impact in the U.S. will be import-savings that are not insig­nificant, and will be much more important at price levels obtaining since 1973. We thus have the interesting question of the interna­tional trade and payments impact of resource recovery in a variety of other basic materials, such as ferrous and non-ferrous metals. So far, this question remains open.

(1)

Range of Values: Year Conversion to Lube Oil

$1000

1965 26,269 - 44,132 1966 27,536 - 46,256 1967 25,040 - 42,068 1968 27,263 - 45,801 1969 27,807 - 46,713 1970 29,321 - 49,256 1971 31,074 - 52,202 1972 34,851 - 58,547'

, $112-189 million at 1974 prices. 2 $144-230 million at 1974 prices.

TABLE IV

Relative Import Displacement Resulting from Waste Oil Recovery

(2)

Range of Values: Conversion to Heating Oil

$1000

33,974 - 54,357 33,923 - 54,274 30,732 - 49,171 34,098 - 54,555 32,782 - 52,451 34,264 - 54,821 39,187 - 62,697 44,724 - 71,557'

(3)

Lube Oil Conversion as Percent of

Lube Import Bill

133 - 223 141 - 236 143 - 241 142 - 240 128 - 216 131 - 221 124 - 208 103 - 174

(4)

Heating Oil Conversion as Percent of Heating Import Bill

3.3 - 5.3 3.2 - 5.1 2.9 - 4.6 2.9 - 4.6 2.6 - 4.8 2.4 - 3.9 2.4 - 3.8 2.9 - 3.5

WASTE OIL 443

FOOTNOTES

*Professor of Economics and Finance, Graduate School of Busi­ness Administration, New York University.

**StaffEconomist, Council on the Environment of New York City (CENYC).

The authors gratefully acknowledge the statistical assistance of Demetrios Cacnis, Sezai Demiral and Ira Sohn, as well as research support of the Ford Foundation and CENYC.

(For a survey of the issues, see Walter, I., Environmental Manage­ment and the International Economic Order, in C. Fred Bergsten (ed.), THE FUTURE OF THE INTERNATIONAL ECONOMIC ORDER: AN AGENDA FOR RESEARCH (Lexington, Mass.: D.C. Heath, 1973). See also papers by Kneese, A.V., H.B. Malmgren, and R.C. D'Arge, in Kneese, A.V., E. Rolfe and J. W. Harned (eds.), MANAGING THE ENVIRONMENT: INTERNATIONAL ECONOMIC COOPERATION AND POLLU­TION CONTROL (New York: Frederick A. Praeger, 1971). Also, Walter, I., Environmental Control and the Patterns of International Trade and Investment: An Emerging Policy Issue, BANCA NAZIONALE DEL LAVORO QUARTERLY REV., (March 1972); D'Arge, R.C., G. C. Huf­bauer and I. Walter, Environmental Quality, Basic Materials Pol­icy, and the International Economy, in National Academy of Sci­ences, MAN, MATERIALS, AND ENVIRONMENT (Cambridge, Mass.: MIT Press, 1973); Walter, I. The Pollution Content of American Trade, WESTERN ECONOMIC JOURNAL (March, 1973); General Agreement on Tariffs and Trade, Industrial Pollution Con~rol and International Trade (Geneva: GATT, July 1971); and D'Arge, R.C. and A.V. Kneese, Environmental Quality and International Trade, INTERNATIONAL ORGANIZATION (Spring 1972).

20ECD, TRADE BY COMMODITIES: MARKET SUMMARIES, Series C (Paris, OECD, Jan.lDec. 1970); United Nations Statistical Office, Commodity Trade Statistics, Series D., STATISTICAL PAPERS (New York, UN, 1970).

3Id. 4American Petroleum Institute, Committee on Disposal of Waste

Products: Waste Oil Roundup, 1:1 (1972). 5U.S. Department of Commerce: Current Industrial Reports,

Sales of Lubricating Oils and Greases in the U.S.A., Series MA-29C (71)-1, (1971).

6The amount of waste depends on the type and use of the lubri­cant. For example, automotive uses of lubricants are estimated to generate 66% to 80% of recoverable waste, while oils used in in-

444 ENVIRONMENT AL AFFAIRS

dustrial applications may generate recoverable waste in the vicinity of 30 per cent. (See, United States Environmental Protection Agency (EPA), WASTE OIL STUDY, Preliminary Report to the Con­gress (April 1973); also Cornell, Howland, Hayes and Merryfield, Seattle Area Oil Waste Disposal Facility Study, Record No. S 5064.0, (Seattle, Washington, Aug. 1969).

7Message to President Nixon, Members of Congress, the Federal Trade Commission, Pollution Control Agencies and Others from Washington, V.T., Executive Director of the Association of Petro­leum Re-refineries, 1971. An article, Waste Oils Pose Disposal Di­lemma, published in ENVIRONMENTAL SCIENCE AND TECHNOLOGY, at 15, (Jan. 1971), brings the percentage of oil recycled down to 10% -15%. Petroleum re-refining is a small industry and while no defini­tive statistics are available, reportedly the number of re-refineries has decreased to 38 from 150 in 1960 and 49 in 1970. (See, Disposal of Waste Lubricating Oil, unpublished paper submitted to the Sec­retary of the Interior from the Bureau of Mineral Resources, June 5, 1970).

8Burning insufficiently treated waste oil for its heating value cre­ates a major pollution problem, since unrefined waste oils produce dangerous levels of metal oxides when burned. H.A. Schroeder states in an article published in FORTUNE (January 1971), entitled Metallic Menaces in the Environment, that "pollution by toxic met­als is a much more serious and much more insidious problem than is pollution by organic substances." See also speech by Hon. G.E. Byron, Maryland, in CONGo RECORD, (daily ed., June 14, 1972) at E 6209; and American Petroleum Institute, Final Report of the Task Force on Used Oil Disposal, (Publ. No. 4036, 1970).

9The Federal Water Pollution Control Act amendments of 1972, (FWPCAA), 33 U.S.C. § 1251 et seq. (Supp. 1973), provide that a permit must be issued by the E.P.A. for any discharge of pollutant, with the exception of aquaculture and dredged material under the jurisdiction of the Army Corps of Engineers. Section 311 of the FWPCAA (33 U.S.C. § 1342(a)(1» regulates the discharge of oil. Section 311(b)(1), (33 U.S.C.A. § 1321(b)(1» states: "The Congress hereby declares that it is the policy of the United States that there should be no discharges of oil or hazardous substances into or upon the navigable waters of the United States, adjoining shorelines, or into or upon the waters of the contiguous zone.

IO"Statistical data show that adults drinking purified surface water take in ... between 0.1 and 1 mg. carcinogene hydrocarbons per year, which ... for the most part originate from oil­contaminating industrial waste waters," Zimmerman, W.,

WASTE OIL 445

POLLUTION OF WATER AND SOIL BY MISCELLANEOUS PETROLEUM PROD­UCTS, at B60-B61. (General Report No.2, International Water Sup­ply Congress & Exhibition, Stockholm June 15 to 19, 1964, pub­lished by the International Water Supply Association, London).

liThe Environmental Protection Agency has released figures indi­cating that 67% of oil pollution in the waters of the world is caused by used motor and industrial oil. See Zeldin, S., Oil Pollution (Audubon Black Paper, No.1), AUDUBON, at 99 (May 1971).

t2'J'he Marine Protection, Research and Sanctuaries Act of 1972, (33 U.S.C. § 1401), popularly known as the Ocean Dumping Act of 1972, seeks to regulate the transportation of materials, including oil, for dumping in the territorial sea, contiguous zone, or the oceans beyond. The FWPCAA, supra n. 9, makes similar provisions (see 33 U.S.C. § 1342).

Internationally, 91 nations agreed, on November 13, 1972, on a global convention to terminate the dumping of poisonous materials, including oil, into the sea. This agreement, "The Convention on the Dumping of Wastes at Sea," goes further than the Ocean Dumping Act in prohibiting the dumping of oil where it might adversely affect the food chain. However, enforcement procedures are left to the individual countries. See, Library of Congress, Congressional Re­search Service, CONGRESS AND THE NATION's ENVIRONMENT, at 578 (Jan. 20, 1973).

t3See, U.S. Department of Commerce, MARITIME ADMINISTRATION PORT COLLECTION AND SEPARATION FACILITIES FOR OILY WASTES, Vol. IV, (March 1973).

HCrankcase waste oil represents one of the most desirable "feed­stocks" for re-refineries because it is less contaminated by water than other oils. The re-refining technology can cope relatively more easily with the problem of increasing additives in automotive oils than with the chemical or water contamination of oils generated from various industries or tank-cleaning terminals.

t5The incorporation of complex additives into new lubricating oils has made the re-refining process more complicated and leaves smaller margins of profit.

t6See , Connor, M.J., Project of a Small New Jersey Company Could Cut Oil Pollution to u.s. Waters, WALL STREET J., Feb. 7, 1973.

t7A.D. Little, Inc., Study of Waste Oil Disposal Practices in Mas­sachusetts, at C-70698, (Report to the Commonwealth of Massachu­setts, Division of Water Pollution Control, Jan. 1969); Cornell, et al., supra n. 6; Environmental Quality Systems, Inc., WASTE OIL

446 ENVIRONMENTAL AFFAIRS

RECOVERY PRACTICES, STATE OF THE ART (1972), prepared for the State of Maryland, Maryland Environmental Service and U.S. En­vironmental Protection Agency (Dec. 1972); EPA, Waste Oil Study, supra n. 6; Maltezou, S., Waste Oil Generation, Disposal and Man­agement Data for the Greater New York Area (prepared for the Council on the Environment of New York City, forthcoming).

18The U.S. Environmental Protection Agency has asked the Envi­ronmental Law Institute, Washington, D.C., to develop suggestions for alternative systems of controlling the disposal of used lubricating oils. Among the mechanisms to be examined for legal feasibility will include: emission fees or taxes, effluent fees or taxes, and positively priced or marketable permits for effluent discharge or emissions.

19Column 2 - U.S. Bureau of Mines, Department of Interior, MINERAL INDUSTRY SURVEYS (Final Summaries of 1966, 1968-1972). Column 3 reflects the averages of various estimates of the waste generated by automotive and industrial oils, EPA, supra n. 6.

2°EPA, supra n. 6. 21Table II, Col. 2. 22More Profit, Less Pollution, CHEMICAL WEEK, Nov. 30, 1968. 23See, THE WALL STREET J. supra n. 16. 24See, CHEMICAL WEEK, supra n. 22. 25Yet certain processes may render conversion to fuel oil equally

profitable. Id. 28U.S. Bureau of Census, Department of Commerce, U.S. FOREIGN

TRADE (IMPORTS), FT-135 (monthly). 27Column 1 and column 2 were derived by multiplying the annual

percentage of foreign crude to total crude oil in the U.S. by the corresponding annual production of total lube oils in the U.S. Columns 3 and 4, Id.; Column 5 was derived by adding columns 1 and 3. Column 6 was derived by adding columns 2 and 4.

28Bureau of Census, supra n. 26.