“The policy rationale for the ban no longer exists, and there are compelling economic and national security reasons for lifting the ban at some point,”
...The Obama administration and Congress don’t seem poised to change anything.
And with them are ban defenders — ranging from environmentalists to domestic oil refiners that produce petroleum products for the domestic market — who are digging in.
...The crude oil export ban was implemented in 1975, when the nation, reeling from the Arab oil embargo, passed the Energy Policy and Conservation Act in an attempt to control prices and ensure crude oil produced in the U.S. stayed in the U.S.
But the oil landscape has changed. Horizontal drilling and hydraulic fracturing ushered in the “shale revolution,” boosting domestic production to record levels.
Consequently, the U.S. is importing less foreign oil.
Chart by Ed Morse, Citi Research. Sources: EIA, DrillingInfo,Citi Research
GOING DOWN: Net oil imports to the United States have declined steadily.
The Center on Global Energy Policy at Columbia University issued a study last month that says ending the ban would allow domestic oil producers to compete in global markets, and that would help consumers by putting downward pressure on prices.
...The Brookings study predicted that by lifting the ban, the U.S. gross domestic product could grow by as much as $1.8 trillion in the next 25 years.
Another factor in the debate centers on the oil itself.
Most of the crude getting tapped with new shale techniques in the U.S. is “light, sweet” — oil that is relatively light in density and low in sulfur content.
But most U.S. refineries are outfitted to process “heavy” crude, and the industry has spent $85 billion in the past 25 years refitting plants to process heavier crude....
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