Murkowski pushes to redefine ‘crude oil’

Greg Nash

Sen. Lisa Murkowski (R-Alaska) is urging the Commerce Department to change its "30-year-old" definition of crude oil in an effort to expand U.S. exports.

The Commerce Department currently treats condensate, an ultralight oil that goes through a minimal refining process, and crude oil the same, Murkowski explained in a report released Wednesday. That needs to change, she said.

"[Commerce] should align its policy with other federal agencies, allowing condensate to be exported alongside natural gas liquids and petroleum products," her report said.

Unlike Commerce, at least six other federal agencies differentiate between crude oil and condensate.

Murkowksi's report, which makes the case for expanding "all condensate" exports, highlights Interior Department agencies including the Bureau of Safety and Environmental Enforcement and the Bureau of Land Management, which assess condensate separately from crude.

The report comes on the heels of a Commerce Department ruling that approved permits for two Texas companies to sell the ultralight oil to foreign buyers.

While the rulings apply specifically to the two companies, it opened up discussion on whether the department — and administration — may be expanding the definition of what constitutes as a "refined petroleum product."

Murkwoski plans to meet with Commerce Secretary Penny Pritzker next week to discuss options for lifting parts of the decades-old ban on crude oil exports, which first took effect during the Arab oil embargoes of the 1970s.

“Condensate exports are an easy first step on the road toward a broader lifting of the oil export ban,” Murkowski said in a statement Wednesday.

“We are producing more condensate than the U.S. market can use, but customers overseas would be happy to purchase it. Global markets need the certainty that reclassifying condensates would provide," she adds.

Calls for lifting the crude oil export ban have gained traction on Capitol Hill among Republicans and a number of pro-fossil fuel Democrats.

However, environmental advocates in Congress argue lifting the ban would hurt gas prices at for the consumer at home.

While the White House has said no policy changes have been made, Pritzker said last week that "serious conversations" were underway "within the administration about what we should do" on oil exports.