US looks sharply at Canadian oil policy

February 27, 1981

Canada's strongly nationalist energy policy is coming in for some criticism from the Reagan administration. According to the Wall Street Journal, the policy calls for increases in domestic ownership of the Canadian petroleum industry through government purchases of major integrated oil companies and government control of offshore exploration.

US Embassy officials here have charged that policy with violating several international accords -- namely that a required use of Canadian goods and services over foreign suppliers violates a provision of the General Agreement on Tariffs and Trade prohibiting government pressure on private companies.

A formal charge is being considered and it is expected that such objections will be part of talks between President Reagan and Prime Minister Pierre Trudeau here in March.