Obama re­sists pres­sure to lift 40-year-old ban

The Washington Times Weekly - - Politics - BY BEN WOLF­GANG

With U.S. en­ergy pro­duc­tion at near-record highs, pres­sure is mount­ing on the Obama ad­min­is­tra­tion to lift a 40-year-old ban on crude oil ex­ports.

The White House ac­knowl­edged that send­ing Amer­i­can crude oil abroad would not drive up do­mes­tic gas prices, a com­mon re­frain among ex­port op­po­nents. In fact, En­ergy In­for­ma­tion Ad­min­is­tra­tion of­fi­cials said ex­ports ac­tu­ally could drive down prices even fur­ther by in­creas­ing global sup­ply.

But un­like Amer­i­can nat­u­ral gas ex­port projects — which Pres­i­dent Obama has come to sup­port and the En­ergy Depart­ment grad­u­ally has be­gun to al­low — the ad­min­is­tra­tion has shown no signs of chang­ing course on the crude oil ban, a relic from the early 1970s when global short­ages led the fed­eral gov­ern­ment to guard U.S. fuel sup­plies and block ex­port.

The dy­namic to­day is dramatically dif­fer­ent, with U.S. crude oil pro­duc­tion near all-time highs and poised to set a record this year.

“Amer­ica’s growth as an en­ergy su­per­power has been a game-changer, but our trade poli­cies are stuck in the 1970s. Study af­ter study shows that free trade in crude oil would pro­mote the cre­ation of U.S. jobs, put down­ward pres­sure on fuel costs and re­duce the power that for­eign sup­pli­ers have over our al­lies,” said Erik Mil­ito, direc­tor of up­stream and in­dus­try op­er­a­tions at the Amer­i­can Petroleum In­sti­tute.

In­deed, the U.S. en­ergy land­scape has been trans­formed in just a few years. Less than a decade ago, most an­a­lysts pre­dicted that the U.S. would re­main a lead­ing im­porter of oil and gas. To­day, Amer­ica is the world’s No. 1 pro­ducer of oil and nat­u­ral gas, thanks largely to the dis­cov­ery of vast de­posits such as the Bakken oil field and the Marcellus Shale, and the ad­vance­ment of the drilling tech­nique known as hy­draulic frac­tur­ing.

The U.S. pro­duced 3.2 bil­lion bar­rels of crude oil last year, ac­cord­ing to EIA fig­ures, a 30-year high. In 2013, the U.S. pro­duced 2.7 bil­lion bar­rels, up from 2 bil­lion a decade ago.

Pro­duc­tion has re­mained strong this year at about 9.4 mil­lion bar­rels per day on av­er­age, gov­ern­ment data show.

Last year, the U.S. also av­er­aged more than 74 bil­lion cu­bic feet of nat­u­ral gas pro­duc­tion per day, EIA num­bers show.

Although the ad­min­is­tra­tion gave the green light to nat­u­ral gas ex­ports — which could help the U.S. be­come a net en­ergy ex­porter within five years, ac­cord­ing to the EIA — the White House still is stand­ing in the way of oil ex­ports.

The White House has given no in­di­ca­tion that it will re­verse course on the crude oil ban any­time soon. Top en­vi­ron­men­tal or­ga­ni­za­tions also re­main op­posed to chang­ing course on oil ex­port pol­icy.

Still, ad­min­is­tra­tion of­fi­cials now ac­knowl­edge that sell­ing Amer­i­can fuel around the world could carry real eco­nomic benefits, giv­ing more ammunition to ex­port pro­po­nents who say the U.S. is miss­ing out on a key eco­nomic op­por­tu­nity.

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