A big oil lobbying group wants to lift the crude oil export ban in the U.S.? Say what?? Yes, you read that right:
Oil producers are forming a coalition dedicated to ending the four-decade U.S. ban on crude exports, signaling a more serious turn in their push to sell to overseas customers.
The Producers for American Crude Exports includes ConocoPhillips, along with at least 13 other companies, company spokesman Daren Beaudo said in a statement. Hess Corp. (HES), Marathon Oil Corp. (MRO), Continental Resources Inc. are also in the group, according to a disclosure statement filed to Congress.
As U.S. oil production increases to its highest point in three decades, advocates for exports say the ban is anachronistic and they point to studies showing positive effects from allowing exports, including more production in the U.S. and cheaper gasoline prices.
I read a similar story a couple of weeks back, but didn't put much thought into it at the time. It seemed to me like the report had to be a covert industry trial balloon to gauge public sentiment. The idea appeared too preposterous for even the oil production industry itself to put forward. The Bloomberg story quoted above has me scratching my head, though.
Even though U.S. consumers (and indeed, a significant portion of U.S. foreign policy) are still basically under the thumb of energy producers in the volatile Middle East, and one of our primary crude oil suppliers is America-hating Venezuela, the oil industry wants to start shipping domestically produced crude offshore? Depending on the source that you believe, the United States imports roughly 40% of the oil we consume.
And, did you catch that bit of puzzling pretzel logic in the Bloomberg story? The industry (and, in fact, the story even cites the GAO) is claiming that allowing U.S. crude oil to be exported to other countries will
lower the cost of refined products such as gasoline in the U.S.
Yeah, I did a double take on that one, too, until it struck me that exporting raw material overseas for processing, then re-importing refined / finished product for consumption in the U.S. (because the cost of making the finished product overseas is so much cheaper than doing it domestically) is not exactly a new idea. And regardless of the industry, doing so ends up being a net loss of well paying jobs in the U.S. That would be particularly true with oil.
The previously cited Bloomberg article does get one thing right:
Even so, energy analysts and lobbyists said success for the effort isn’t certain in Washington, where the focus has long been on how to cut ties to overseas oil tyrants.
“Every politician running for dog catcher to president over the last 30 years has told the American people that all of our problems would be solved if we achieved ‘energy independence,’” said Jeff Navin, a former deputy chief of staff at the Energy Department under President Barack Obama. “The politics of this are extremely tough, and you’ve seen free market Republicans in oil patch states hesitant to embrace a full scale policy of exports.”
Remember this? It wasn't that long ago:
We all know, however, that the GOP can change direction with the speed of a Sarah Palin wink. I fully expect them to now embrace their "let the free market work" and "no regulations" philosophy with regards to the proposal to end the crude oil export ban.
I've got an idea - Not a drop of crude oil produced in the U.S. leaves the country until the country is completely weaned off of oil imports, and we are 100% self sufficient in meeting our own needs.
Lifting the crude oil export ban is an incredibly bad idea that progressive activists, economists, and politicians need to squash like a bug before it has a chance to grow legs. When we are not importing a single barrel of oil from a repressive Middle Eastern regime like Saudi Arabia or a sworn enemy of the U.S. such as Venezuela, come talk to me. Until then, no lifting the crude oil export ban.