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Momentum builds to allow US oil exports

Momentum builds to allow US oil exports
© Greg Nash

For the first time in decades there are calls within the House Republican conference to lift the ban on crude oil exports, signaling what could become a sweeping shift in U.S. policy.

In the last month, the Texas congressional delegation — in particular Rep. Joe Barton (R), who heads the House task force studying oil exports — has ramped up pressure to lift the moratorium, which dates back to the 1970s.

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When Sen. Lisa Murkowski (R-Alaska) took the lead earlier this year, suggesting it was time to lift the ban, House Republicans were slow to chime in.

That has changed in a matter of months.

“The shale revolution has drastically reshaped America’s energy landscape, unlocking a vast supply of untapped oil and gas,” Barton said in an email to The Hill.

“In order to take full advantage of this opportunity, we need to rethink outdated laws that were passed during an era of energy scarcity, which is why I am in favor of overturning the ban on crude oil exports,” he added.

In November, the Energy Department’s stats shop reported that for the first time in 20 years domestic crude oil production surpassed foreign imports.

And that production isn’t expected to slow down, Barton said, with recent estimates showing the U.S. has “more than enough resources to meet our domestic energy needs.”

While a number of Republicans have held back on the issue, especially those who represent districts that oil refiners call home, Barton expects the House to tackle oil exports head on next year.

He is currently working on legislation that would repeal the ban on crude oil exports altogether, and will be introducing that soon.

Barton isn’t alone in his push for exports, Rep. Bill Flores (R-Texas) too wants to see the ban completely lifted.

But where Barton sees real action coming next year, Flores thinks his Republican colleagues need time.

Flores is confident they will come around to agreeing with him. For now, though, he said it’s “premature” for the House to vote on the ban.

Flores said it was important to educate the public on the benefits from oil exports.

“We just need to get through the economic benefits for the American soccer mom about how she is better off, and her family’s better off, by having crude oil exports,” he said. “That’s just going to take a little time.”

Flores is being patient, allowing his fellow lawmakers time to think through the issue. He hopes that the Energy and Commerce Committee will hold a hearing on lifting the ban next year — or even in 2016.

“It’s going to take a full discussion to make sure everybody knows the economics and they know whose ox gets gored in this,” he said. “And really, if we do it right, nobody’s ox gets gored.”

The likelihood of any movement this year is slim.

Rep. Fred Upton (R-Mich.), chairman of the House Energy panel, said he is focused on natural gas exports, but is still studying crude exports.

When asked if he supported lifting the moratorium, Upton said he “hasn’t said yet,” but acknowledged “there is a push from the Texas folks.”

Next year is a different ball game, according to Barton.

“I am confident that it will gain traction legislatively next year,” he said.

“Pressure to remove the ban on crude oil exports is growing from both ends of the political spectrum,” he added.

Many Republicans and a majority of Democrats, though, are hesitant over the impact more oil exports could have on consumers.

Refiners like San Antonio-based Valero argue the system works as is.

“It would do more harm than good and lead to higher prices in the U.S. for consumers,” Valero told The Hill earlier this year.

Still, Barton says he is “seeing support grow every day” for a change in policy.

Jordan Haverly, a spokesman for Rep. John Shimkus (Ill.), a top Republican on the Energy committee, said his boss is open to lifting the ban “and treating American crude oil like other domestically-produced commodities.”

The Commerce Department too has indicated it is having a serious discussion about crude oil exports. The White House says it is “evaluating” the policy, but has not announced any changes.

But Barton is confident the ban will soon be lifted.

“I predict that no matter which party controls Capitol Hill or the White House, the ban will eventually be lifted for the same reasons Congress eventually overturned other failed government efforts to regulate energy price and supply,” he said.