By Timothy Cama - 04/01/14 04:35 PM EDT
Rep. Michael McCaul (R-Texas) introduced a bill Tuesday to repeal the 1970s ban on exporting crude oil, a move he said would create jobs and provide an energy alternative for United States allies.
The prohibition was enacted in response to OPEC’s oil embargo, but the ban is now outdated, McCaul said.
“Most of America’s crude oil production is taking place underneath the feet of Texans in the Eagle Ford Shale formation and the Permian Basin,” McCaul said in a Tuesday statement. “Lifting the outdated ban on crude oil exports will result in more production, create new jobs at home and boost America's energy security while providing countries like Ukraine with a dependable supply alternative to energy imports from countries like Russia.”
McCaul’s bill comes as policymakers discuss the implications of increasing energy exports to Eastern Europe, which largely relies on Russia for the natural gas it uses for heat and electricity.
The day before McCaul introduced his proposal, the American Petroleum Institute released a study it comissioned that concluded that allowing crude exports could create up to 300,000 new jobs by 2020 while lowering fuel costs domestically by billions of dollars.
“Consumers are among the first to benefit from free trade, and crude oil is no exception,” Kyle Isakower, API’s vice president for regulatory and economic policy, said in a statement.
Harold Hamm, chairman and CEO of Continental Resources Inc. and chairman of the Domestic Energy Producers Alliance, urged the House Foreign Relations Committee last week to overturn the ban, saying the infrastructure for crude oil exports exists, but Eastern European countries lack LNG infrastructure.
McCaul’s bill would allow the president or Congress to exclude certain countries from importing U.S. crude.