Newsletter: Where Does the Administration Stand on Lifting the Crude Oil Export Ban?

Washington DC is seeing a renewed push to eliminate the 40-year old regulation limiting the export of crude oil from the United States. The American Petroleum Institute has listed it as one of its top lobbying priorities for this Congressional session, and Senator Lisa Murkowski has begun a legislative campaign to eliminate the ban in her role as Chair of the Senate Energy Committee.

Meanwhile, as described in recent Congressional testimony by OCI Executive Director Steve Kretzmann, our analysis has shown, in a rare concurrence with the American Petroleum Institute, that lifting the ban will incentivize increased U.S. oil production. According to our analysis, this in turn would result in increased greenhouse gas emissions.

But any action on weakening the crude export ban would need to pass through President Obama’s Administration, either by his signing a bill passed by Congress, or by agencies taking action to make changes to the ban under his watch. So, where does the Administration stand on this issue? The President has stayed mum so far while his Administration officials have presented a hazy picture.

Energy Secretary Ernest Moniz has been vocal on the issue, but also inconsistent. Just a year ago, Secretary Moniz was quoted suggesting that eliminating the crude export ban should be seriously considered. Yet, in comments in April of this year, his interest in adjusting the crude export ban appeared to have waned; he said he does not see a compelling economic argument for relaxing the regulation.

Other Administration officials have expressed mixed views on the ban as well. Once a supporter of adjusting the ban, former Administration official John Podesta later suggested that “there is not a lot of pressure to do more” beyond a late 2014 ruling by the Commerce Department that allowed lightly-processed condensate to be exported freely for the first time. Commerce Secretary Penny Pritzker has been ambiguous in her statements, suggesting the regulation merits discussion while not otherwise expressing an opinion.

The Energy Information Agency’s chief Adam Sieminski has said that there is no imminent “need” to end the ban, while the Government Accountability Office published a report that suggests the impact on gas prices of lifting the ban would be negligible in either direction.

So, the debate as to whether to lift the ban essentially comes down to interests aligned with increasing the oil industry’s profits versus those concerned with aligning U.S. energy policy with its climate imperatives. It is sure to heat up as the summer goes on.