Lawmakers Mull Lifting Longtime Ban on Oil Exports

A booming domestic energy sector raises questions about whether a decades-old ban still makes sense

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Kristoffer Tripplaar / Sipa / AP

Harold Hamm, chairman and CEO of Continental Resources testifies before the Senate Energy and Natural Resources Committee on Thursday.

Lawmakers debated ending a decades-old ban on exporting crude oil overseas on Thursday, revisiting a restriction enacted at the height of America’s oil worries and seen by some as outdated amid a domestic energy boom.

At a hearing of the Senate Energy and Natural Resources Committee, lawmakers and policy experts weighed the price stability of oil in the United States, job creation, and national security considerations relating to the 1975 Energy Policy and Conservation Act. Created in response to the famous Middle East oil embargo and subsequent oil crisis in 1973, the law keeps all U.S. crude oil business within the country, while still allowing the export of refined oil and gases.

“We are witnessing an energy revolution,” said Louisiana Democratic Sen. Mary Landrieu. “That’s why we’re having this testimony today.”

Lawmakers and experts said improved technology, a weakened job market and the current “energy renaissance,” which includes a natural gas boom, are all reasons to reopen debate about lifting the ban and adding American crude oil to the global market. Congress remains fiercely divided over energy policy in general, making consensus on a legislative change difficult to reach. With modest aims, senators painted the hearing as just the start of a process.

“[This] is the beginning of many very considered and thoughtful discussions on what is a very timely issue,” said Alaska Republican Sen. Lisa Murkowksi, the committee’s top Republican.

Harold Hamm, chairman and CEO of the petroleum company Continental Resources, said the law was born of oil scarcity fears that no longer exist.

“Experts… agree we will be energy independent in terms of crude oil within a decade or two,” said Hamm, a proponent for lifting the ban. “Through technological breakthroughs in precision horizontal drilling, we can develop resources previously thought to be unattainable.”

Opponents of lifting the ban conceded oil shortages are no longer the problem, but said prices could rise if the country begins exporting crude oil, to the detriment of American consumers.

“Any oil sent overseas must be replaced, which could raise prices,” said Daniel Weiss, the director of climate strategy at the liberal Center for American Progress. “Oil produced in the United States is significantly less vulnerable to supply disruptions and therefore provides more energy security.”

Opponents noted that the OPEC oil cartel, whose embargo sparked the 1973 energy crisis, still produces about 40 percent of the world’s crude oil, according to the U.S. Energy Information Administration.

“The global market is influenced by an oligopoly where OPEC countries control production in order to set prices,” said Graeme Burnett, senior vice president of Delta Air Lines, who predicted OPEC would lessen its crude oil supply if the U.S. entered a global market in order to maintain high prices.

But Amy Jaffe, the executive director of energy and sustainability at University of California, Davis, argued that lifting the ban would dilute OPEC’s market share and therefore its power over prices. Proponents for lifting the ban also said doing so could create domestic jobs.

“The energy sector has added jobs for millions of Americans—both directly and indirectly through energy service and equipment companies,” Hamm said. “Lifting export restrictions will strengthen our domestic oil industry, a critical component of our economy.”

21 comments
isonespal
isonespal

countless number of people have given their lives, or had their lives taken from them , to protect the oil supply. Now we are approaching energy independence,  with a slow ,steadily improving, yet still fragile economy very sensitive to energy prices.

Taking the restrictions off energy exports will do nothing to lower the price of energy in this country, and may very well increase prices. At this moment propane price is being manipulated. There is plenty of propane but it's not being put on the market till the price doubles. Why risk the blessing of abundant energy in order that a very few already wealthy people  can manipulate the energy supply to their benefit but to the detriment of our economy.

meddevguy
meddevguy

Puuleeze! The only reason any White House action will take place is for the same reason every single, without fail edict has been thrown -- to keep the political party in power! Benefits or damage to Americans is way down in 10'th place -- the desire is simple -- VOTES.


The first two questions in the 2016 Presidential debates ought to be "if elected, will you stop campaigning and administer an Administration for your country?" and "Do you like America and Americans?".

J.London
J.London

Until such a time that we as a country no longer have a need for outside crude products should the laws be changed. We need to keep this law on the books until we are 100% sufficient on our fuel and oil needs.

The oil embargo of the early 70s was a sham to begin with,, now the laws which was made then to stop the out flow of petro products are where we are today.

Keep it until no outside sources needed to be brought in...Simple. Feed ourselves before we feed others with our oil.

RossNicholson
RossNicholson

Economists have a mathematical proof that if two nations produced only one product, allowing trade in that one product between the two then that would increase total incomes in both.  This law has been a terrible burden on American commerce.  Sure sometimes, for freedom or for the safety of millions of people, American companies must be hobbled for the national interest.  Since sales are to our allies, this law hurts us and hurts our allies, too.  

At the time, since virtually no crude was exported anyway, this bit of incompetence mattered little.  In an age of Fracking, however, this law is a bullet to the foot.  


It's probably best to change this law instantly.

ARTRaveler
ARTRaveler

If we aren't already shipping oil out of the country, who are all of the refineries along the Gulf.  We know that Venezeula oil came in, got refined, and went back out of the ports and has done so for years and now those are the same refineries that the Canadian tar sand bitmit would be sent to.

sacredh
sacredh

The XL pipeline would bring tar sands from Canada down through red states to red states along the gulf that would then refine it into oil that the oil companies would sell overseas. What a great deal! The American tax payers would pay for a multi-billion pipeline for the oil companies to make enormous profits from. What's wrong with this picture? The Koch brothers own 1.7 million acres in Canada that just happens to contain said tar sands. They could make upwards of 100 billion dollars off of the tar sands. Then they'd fund more baggers to get elected with some of the profits to make sure their profit margins stayed healthy. I may be a little leary, but hey!, why not let the Koch brothers buy the rest of the government?

drudown
drudown

Gee, let’s start the “debate” with the COST/BENEFIT to the People and State from the GOP’s proposed plan to “lift the ban” on Oil exports in a subversive attempt to advance a larger “fracking” agenda that is prohibitively more expensive (e.g., post-methane leaks; National Security issues; and TRILLIONS of foreseeable REMEDIATION costs for our DWINDLING potable water supplies). Taken to its illogical conclusion, the GOP sure seems to be “strategizing” as if Climate Change wasn’t, in fact, any more real that their collect DUTY to ALWAYS ADVANCE A COMPELLING STATE INTEREST. Sorry, a few dirty jobs and a even less people making a TON of money selling “cheap natural gas” to Asia is not PREFERABLE to simply TAXING the US Corporations the GOP has tried to SHIELD from ANY taxation in violation of the Equal Protection Clause. In short, the State is better off simply “capturing” wealth from these corrupt Corporations polluting the integrity of our political system and the very fresh water our Economy, Agriculture and National Security depend on. The “risk” has already proven to be far more DAMAGES (google “fracking + Pavilion, WY”) than any benefit. So why is the GOP hell bent on pushing an INJURIOUS course of Energy policy as it tries to “muscle through” an UNLAWFUL “trade agreement” with (I can write this) private entities and market players acting merely under the color of foreign law. That is NOT LEGAL in the United States. What, these people happen to work for the State so it makes it “legal” to SUBVERT the Constitution or People’s Substantive and Procedural Due Process rights by “fast tracking” the Trans-Pacific Partnership (“TPP”)? That just shows more evidence and Scienter of CORRUPTION and intent to injure the People, the Military’s streamlined functioning and the Several States.

What do you make of the GOP governors trying to "block" Medicaid and ACA expansion? The are (literally) DENYING American citizens of ALL races, cultures and ages from simply getting medical treatment. Do you think that kind of "refusal to serve the greater good"  would seem to [adversely] "say more about what kind of person" the elected officials are than athletes, students, mystics or medicinal users choosing to ingest marijuana? My God if you found out someone fed your child a glass of Benzene water- well, just explain to me how the GOP can purport to "hand our ONLY FRESH WATER SUPPLY" over to a select handful of Oil and Gas Companies that just want to make a quick buck selling it cheaply to Asia. That is TREASON, i.e,, INJURING the strategic interests of the United States. Spare us the "grandpa knows best" weed makes you harmful to society when it is your own lobbyist-driven GOP LIE that took us to this uncompromising state of affairs: you want "hate" the very government your own "starve the State of revenue" foreseeable creates. And by creating this faux ILLUSION of a fiscal shortfall, your TREASON that transmutes into deliberately starving necessary and proper regulatory agencies (EPA, IRS, FBI/POLICE/FIRE/EMT) of the very revenue the GOP CONGRESS thinks it can "take a pledge to Grover Norquist" and avoid FOLLOWING the LAW…even if this UNLAWFUL PLEDGE contravenes the EXPRESS LANGUAGE of the Constitution? To even have the sheer audacity to "blame' President Obama for ANY "gridlock" or "lack of results" would require such a degree of self-deception…you would have to be a SUBJECT to a DESPOT to live with it. That is no different than expecting what, something "other" than mass deaths/birth defects/organ failure when pumping "POISONOUS BENZENE, et al." in "fracking fluids" INTO our ONLY WATER SUPPLY? Should our Police Power expect something "other" than hysteria when, gee, our brothers and sisters south of the border or fill-in-the-blank have THEIR potable water supply RUINED in a New York Minute like Pavilion, WY. 

"What then" of your TREASONOUS "government is the problem" GOP ruling star? Who is going to PAY for the FORESEEABLE TRILLIONS and TRILLIONS to "undo" what should be flat out ENJOINED on account of fiscal prudence, health and safety concerns and REQUIRING a nexus between the proposed State Action and a COMPELLING STATE INTEREST.

Whatanotion
Whatanotion

Dog and Pony Show put on by Legislature to placate suspicious Americans-Guess who wins? ; is what should be the title of this article. 

tkulaga
tkulaga

What I don't understand is why do they set gasoline prices based on the global cost of a barrel of oil when the oil is coming from the Bakken, Eagle Ford or elsewhere in the US?  Sounds to me like the Oil refineries got us over a barrel.

Hotpuppy
Hotpuppy

NO NO NO!  What is outdated is bribery, corruption, and business as usual.  IT's bad enough that foreign companies are doing the exploration and production in the US.  They simply extract the profits and take them home.  Stupid politicians can only remember as far back as the last bribe/donation.

La_Randy
La_Randy

First, the corporations tell you that developing and drilling for oil is for energy independence, so that we do not have to rely on foreign oil. After the oil is coming out of the ground they tell us to sell it, internationally, because of all the jobs it creates.


Bet those jobs don't last either.

NicolasEdwards
NicolasEdwards

@RossNicholson To bad that mathematical proof does not work in the real world. In the real world publicly traded companies have to maximize profit. That means that as India and china continue to have population booms and their citizens become middle class, they will out strip us for demand of oil. Then oil procured in the usa will go to those nations and our prices will go up. 

manlyman
manlyman

@sacredh Soros has already bought the government dumba$$! And he could buy the Koch bros a dozen times over.

And he doesn't need to buy votes since he owns the machines that count em.

Those painkillers are taking their toll on your brain dude.

tkulaga
tkulaga

@Hotpuppy It might be foreign companies, but it can have US shareholders and US employees can it not?

manlyman
manlyman

@La_Randy Increasing the oil supply always brings down gas prices. You can complicate the discussion by talking about greed and profit margins and all that other crap that will never change, but the fact remains. Am I the only one that remembers what life was like when gas was under 2 dollars a gallon? It was less than a decade ago. We have enough oil and gas in this country to supply the world for centuries to come. Yet foreign countries set the price. What am I missing?

ARTRaveler
ARTRaveler

@manlyman @sacredh  No, manlyman, that was a Bush 2 supporter  who owns Diebold and who was a bundler for Bush and promised Bush 2 a victory.


 And George Soros isn't trying to destroy all environmental and health regulations in the country by buying local, state, and federal elected critters to be their "pet" congress critters.  They are involved in stopping possible contamination of the water supply in the Little Rock area for 450,000 people by working to stop any regulation of the water shed. A water shed that also has Mobil-Exxon's Pegasus pipeline going through the area also.

cent-fan
cent-fan

@manlyman @La_Randy I guess you are missing something.  Crude oil and gas is gushing out of the ground from many new domestic sources yet I paid almost $4 a gallon for my last home heating oil delivery.  How come the market prices aren't crashing?  Could it be that the real profit control is with the refiners who can turn on and off the spigot at will?


Maybe this is mostly about sourcing crude oil rather than putting it on the store shelf to be sold.  As an oil company I only have to know how much I control in the ground and how to get to it.  I don't need it in the pipeline until the prices are high enough... and then I just say "oops, refined home heating oil instead of gasoline, so sorry the price at the pump will be high again this summer".


  So your contention is that corporate greed exists but doesn't effect oil prices?  The real culprit is the government that stands in the way and abuses the poor oil corporations?  Oil companies don't control supply?  The governments of OPEC believe in free and open markets and the self-determination of their people while the US government simply has us under their thumb?

cent-fan
cent-fan

@manlyman @cent-fan@La_Randy Hmmm... yeah.  Fine.  What is going to cause the oil to gush at a rate you deem reasonable?  Does Obama personally have the power to force the oil companies to dump oil onto the market to drive down prices and thereby ruin the oil company profits and their net worth?  Do you think the government should take control of the oil companies (you commy) or do you think the oil companies will volunteer to destroy their profit margins (you babe in the woods)?


Four bucks a gallon is the new normal.  If you ever paid near that you only proved to the oil companies that you would, so the price stays.  Next stop, five buck a gallon.

manlyman
manlyman

@cent-fan @manlyman @La_Randy It's gushing out of the ground at a fraction of the rate that it could be. But you know this. Spare me the liberal mumbo-jumbo. Like I said, I know what gasoline cost when Obama came into office, and I damn sure know what it costs now.