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End of oil export ban could make waves in 2016
Roger DuPuis//December 29, 2015//
Listen to this articleWhen Congress passed its $1.1 trillion spending bill, included in the measure was an end to the nation’s 40-year-old ban on exporting crude oil.
What will it mean for American business? For Pennsylvania? This week could bring some important benchmarks to watch.
As the Wall Street Journal points out, the American Petroleum Institute will release its weekly U.S. stock forecast today, while the Energy Department will issue its official figures tomorrow, but already crude prices are trending up.
Yet, as WSJ notes, the move also comes at a time when crude is approaching lows not seen for more than a decade and Iran also is preparing to resume exports, so the market could remain glutted for some time to come.
The ban — in effect a requirement that companies obtain federal permission to export crude oil — was imposed in response to the 1970s Arab oil embargo against the United States.
Pennsylvania ranked 18th out of 50 states for crude oil production in the most recent data from the U.S. Energy Information Administration, and the refinery and pipeline industries do have a significant presence in the state.
Most midstate lawmakers supported an end to the ban, arguing that the growth of shale gas production puts the country in a comfortable position to begin exporting again.
But U.S. Rep. Patrick Meehan (R-Delaware), whose district includes part of Lancaster County as well as oil refineries in southeastern Delaware County, expressed concern that energy independence, affordable prices and a secure supply could be put at risk, along with refining jobs.
Debate on the move’s impact on Philadelphia-area refineries has been going on for some time.
As for the shale industry, they, too, will be able to export, so that could mean increased profits and production for that sector.
With so much product and so many players, that glut doesn’t look poised to end anytime soon.
