Posted September 1, 2015
Some quick points from the new crude oil exports study from the U.S. Energy Information Administration (EIA):
First, like a series of other studies before it, EIA’s study finds that lifting America’s 1970s-era ban on exporting domestic crude oil would not negatively affect U.S. consumers. EIA says:
Petroleum product prices in the United States, including gasoline prices, would be either unchanged or slightly reduced by the removal of current restrictions on crude oil exports.
EIA projects that ending the export ban – which would allow shut-in domestic crude to access global crude oil markets – would spur more domestic production. Then the global supply/demand would become “looser,” putting downward pressure on global crude prices, resulting in “lower petroleum product prices for U.S. consumers."
This is significant. EIA’s analysis projects macro-market impacts from lifting the U.S. export ban that are consistent with studies by Resources for the Future, IHS, ICF International, the Congressional Budget Office, Columbia University’s Center on Global Energy Policy, the Aspen Institute and Manufacturers Alliance for Productivity and Innovation, the Government Accountability Office and Brookings Energy Security Initiative.
Second, EIA projects that ending the export ban, in a high-production scenario, could increase U.S. crude output by 470,000 barrels per day in 2025. EIA’s chart:
EIA’s projection of increased production is consistent with ICF International’s projection of 500,000 barrels per day of increased output by 2020 – upon which ICF bases a number of macro-economic effects including $38.1 billion in increased GDP and 300,000 additional jobs in 2020.
What’s seen with EIA’s report is a deepening of the research foundation for a decision to end a four-decades-old export ban that sanctions U.S. crude oil production, hurts American competitiveness in the global marketplace and denies the trade benefits of exporting crude oil to America and individual Americans. API’s Kyle Isakower, vice president of regulatory and economic policy:
“The EIA report provides a final, non-partisan confirmation that ‘70s-era trade restrictions on U.S. oil are bad for American consumers. America is now a global energy superpower, and we shouldn’t have trade policies that make it harder for the U.S. to compete with other suppliers, like Iran and Russia. The EIA report only reinforces the economic benefits of exports outlined in every other major study – more U.S. jobs, greater U.S. energy production, and downward pressure on fuel costs. … It’s time for policymakers to harness the economic advantages of free trade by lifting the outdated ban on crude exports. Strong, bipartisan legislation is now making its way through both chambers of Congress. Lawmakers need to make this issue an immediate priority when they return from the summer break.”
ABOUT THE AUTHOR
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.