8/28/15 Breaking news: After Menendez Clarifies Support of Crude Oil Export Ban, Allied Progress Declares Victory
Members of the House of Representatives could vote on legislation to allow U.S. crude oil exports as soon as September. House Speaker John Boehner (R-Ohio) has said repealing the crude oil export ban will be a high priority once lawmakers return from their month-long summer vacations.
In July, the Senate Energy and Natural Resources approved legislation that would end the ban as part of a broader energy package in the works.
On August 14, the U.S. Commerce Department informed members of Congress about the impending approval of an application by the national oil company of Mexico to exchange heavy oil pumped there for light crude pumped in the U.S., a move that further erodes the 1973 ban.
As a result of the 1973 OPEC oil embargo, U.S. trade restrictions were enacted that banned most exports of raw, unprocessed crude. Refined petroleum products, such as gasoline and jet fuel, are not included in the ban. Nor are crude oil shipments to Canada, and crude oil extracted offshore from California and Alaska.
As crude oil prices decline while U.S. oil production surges, energy companies are no longer satisfied with selling their product to U.S. refineries and view the export market as the way to boost their sagging profits.
Last Friday, the Center for American Progress (CAP) released an analysis that focuses on the potential environmental impacts caused by lifting the ban on exports. Most of the data came from the oil industry’s own commissioned studies. The CAP review concludes that opening up the global export market will lead to more oil drilling in the U.S., resulting in an increase in annual carbon and methane emissions, the loss of open lands and wildlife habitats, as well as the risks related to production and transportation, like the epidemic of crude oil train derailments, and deteriorating air & water quality for people who live near drilling operations.
… These preliminary estimates are based on the Center for American Progress’ review of three studies. Two of the studies were commissioned by the oil industry: an analysis by ICF International on behalf of the American Petroleum Institute, published in March 2014, and a report funded by a coalition of oil companies and released in May 2014 by IHS CERA. The third study, conducted by National Economic Research Associates, or NERA, Consulting and published in September 2014, was commissioned by the Brookings Institution, which is a vocal advocate for U.S. crude oil exports.
U.S. land loss
Each of the three industry-oriented studies that CAP reviewed predicts that U.S. oil production would increase if the United States exports more crude oil. If these predictions are accurate, increasing production to meet the demands of foreign consumers will result in the loss of open lands and wildlife habitat as the industry builds new wells, well pads, and roads. The question for Congress is by how much?
According to data from IHS CERA’s study that was provided to CAP, oil companies would drill an average of 26,385 new oil wells in the United States every year between 2016 and 2030 if the crude oil export ban is lifted, or approximately 7,600 more wells on average per year than if the ban remains in place.
… If these development patterns continue, IHS CERA’s forecasts of new drilling activity suggest that increased oil exports would alone result in the loss of as much as 2,054 square miles of land between 2016 and 2030, or an area larger than the state of Delaware. This means the United States would lose approximately 137 square miles of land to oil infrastructure per year, or an area larger than Arches National Park in Utah, simply to feed foreign demand for U.S. crude oil …
The Domestic Energy Producers Alliance (DEPA – a group of energy groups), co-founded by Continental Resources CEO Harold Hamm, is running two TV ads in Montana, New Mexico, Ohio, and Virginia, through September 7. The ads, which are also online, aim to build support for repealing the ban and create talking points for lawmakers already leaning pro-exports. True to form, the industry uses the media to catapult their propaganda.
The ads, aptly titled Why? and Question Mark, simply recycle the same old crap in a new package insisting that exports will not only “lower gasoline prices” and “create millions of new, high-paying jobs,” but will also boost “our national balance of trade” and make the U.S. even more energy independent. Of course as an added bonus exports will make us safe from terrorists.
A new nonprofit grassroots organization, Allied Progress is taking on the export issue with an aggressive campaign that debunks claims in DEPA’s ads and tweaks a senator.
Senator Robert Menendez (D-New Jersey) has been a long-time opponent of any effort to repeal the crude export ban. However while explaining his opposition to the Iran nuclear agreement in a speech on August 18, Menendez urged the U.S. to “consider licensing the strategic export of American oil to allied countries struggling with supply because Iranian oil remains off the market.”
Allied Progress launched a 30-second TV ad in New Jersey, and online, that blasts Senator Menendez for his endorsement of domestic crude oil exports.
A fact sheet on the Allied Progress website titled, We Can’t Afford to Repeal the Crude Oil Export Ban features testimonies and quotations from experts across the country that dismantle DEPA’s ad propaganda.
These are a few examples. Read the rest here.
DEPA claims lifting the crude oil export ban will “lower gasoline prices.”
Average U.S. Gas Prices Could Increase by As Much As 14.5 Cents Per Gallon: According to consulting firm Stancil & Co., “ending the decades-old ban would raise gasoline prices. The study by Alan Stevens, president of consulting firm Stancil & Co., predicted an average gas price increase of 8.4 cents to 14.5 cents per gallon if domestic oil producers are allowed to ship their products overseas.” It concluded, “‘allowing the export of crude would cause domestic gasoline, jet fuel, diesel, and heating oil prices to increase.’” (The Hill, 07/27/15)
DEPA claims lifting the crude oil export ban will “create millions of new, high-paying jobs.”
U.S. Refining Capacity Will Drop and Good American Jobs Will Be Lost: According to the CRUDE Coalition, if the ban is lifted oil companies will export oil, “unrefined, to places with growing demand like China, projected to be the main source of global demand growth in 2015 and 2016. Some integrated firms will export to… [overseas] refiners, bypassing American refining competitors. We’ll see more petroleum products refined … [overseas] but derived from American crude returning to our shores. If this were to happen, American refining capacity will drop, and good American jobs will be lost and the economic activity and energy security that are derived from increased domestic production will be minimized.” (Congressional Testimony by Jeffrey Warmann of Monroe Energy Inc. on Behalf of the CRUDE Coalition, 03/19/15)
DEPA claims lifting the crude oil export ban will make the U.S. more energy independent.
Lifting the Ban Would Benefit China: “Kirk Lippold, a retired US Navy commander who is a strategic planning consultant,” thinks “the number one beneficiary of lifting the ban is likely to be China.” (Oil & Gas Journal, 07/10/15)
Exporting U.S. Oil to Place Like China While Importing Oil From Places Like the Middle East: According to the CRUDE Coalition, “America is producing a lot of crude oil, but…we’re importing more foreign oil than we did 40 years ago when the ban was first enacted! We import 7 million barrels of foreign oil a day, including over 3 million per day from the Middle East. For every barrel of oil exported, that would mean one more barrel of oil we would have to import – increasing, not decreasing, our dependence on foreign producers. Exporting oil to places like China, while importing more oil from the Middle East, only undermines our national security.” (CRUDE Coalition)
For more information:
Allied Progress: We Can’t Afford to Repeal the Crude Oil Export Ban
Allied Progress: Keep the Ban
Oil Change International: Should It Stay or Should It Go? The Case Against Crude Oil Exports