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NEWS RELEASE 03-038; April 8, 2003
April 8, 2003
News Release 03-038
Inv. No. 332-444
STUDY FINDS ROOM FOR INCREASED LIBERALIZATION
OF TRADE IN OIL AND GAS FIELD SERVICES
Ongoing negotiations under the General Agreement on Trade in Services (GATS) offer a means
of addressing many of the trade impediments encountered by oil and gas field service providers,
reports the U.S. International Trade Commission (ITC) in its study Oil and Gas Field Services:
Impediments to Trade and Prospects for Liberalization.
The ITC, an independent, nonpartisan, factfinding federal agency, conducted the investigation at
the request of the U.S. Trade Representative. The report describes the various activities involved
in oil and gas field services, discusses the nature and extent of trade, and examines the extent of
impediments to trade and the potential benefits of trade liberalization. Highlights of the report
- The most frequently encountered impediments to trade in oil and gas field services are
poor transparency, specific labor requirements, joint-venture requirements, limitations on
foreign investment, and technology transfer requirements. Many of these impediments are
addressed by principles contained within the GATS, one of the World Trade Organization
- To date, 51 out of 144 WTO members have made binding commitments that pertain to oil
and gas field services under the GATS. These countries account for 36 percent of world
oil reserves, 42 percent of world oil production, 30 percent of world natural gas reserves,
and 48 percent of world natural gas production. However, the commitments made by all
but eight of these countries may be considered "partial" commitments in that market
access and nondiscriminatory treatment are not guaranteed unconditionally.
- On the basis of existing commitments, there appears to be considerable room for pursuing
further liberalization of oil and gas field services under the GATS. If WTO members
who have yet to list any commitments in this sector were to schedule at least some
commitments, benefits such as increased transparency, improved legal certainty, and the
establishment of a baseline level of treatment that would prevent a country from
increasing restrictions on foreign oil and gas field service providers would result.
Additional progress could be made if those countries that have already scheduled partial
commitments would schedule further trade liberalizing commitments that reduce or
eliminate remaining significant restrictions on market access and national treatment.
- Further liberalization would improve the general business environment for oil and gas
field service providers. The result would likely be enhanced competition within the
industry, which will lower the costs of developing oil and gas resources, to the ultimate
benefit of oil and gas producers, consumers, and the global economy.
Oil and Gas Field Services: Impediments to Trade and Prospects for Liberalization
(Investigation 332-444, USITC publication 3582, March 2003) will be posted in the Publications
area of the ITC Internet site at www.usitc.gov. A printed or CD-ROM copy may be requested by
calling 202-205-1809 or by writing the office of the Secretary, U.S. International Trade
Commission, 500 E Street, SW, Washington, DC, 20436. Requests may also be made by fax to
ITC general factfinding investigations, such as this one, cover matters related to tariffs or trade.
The investigations are generally conducted at the request of USTR, the Senate Committee on
Finance, or the House Committee on Ways and Means; the ITC may also self-initiate
investigations. The resulting reports convey the Commission's objective findings and
independent analyses on the subjects investigated. The Commission makes no recommendations
on policy or other matters in its general factfinding reports. Upon completion of each
investigation, the ITC submits its findings and analyses to the requester. General factfinding
investigation reports are subsequently released to the public, unless they are classified by the
requester for national security reasons.
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