End oil export ban (DE members)

SECURE AMERICA’S FUTURE ECONOMY, advocating smaller, more focused, less costly government since 1996 http://www.s-a-f-e.org/

October 5, 2015

Dear Senator Carper, Senator Coons, and Representative Carney:

Is there some reason for the United State to ban the export of US-produced crude oil? We don’t think so, and would therefore urge you to support HR 702 – due to be voted on by the House in the next few days – which would repeal this 40-year-old law.

We don’t think the export ban made sense in 1975, but in any case conditions have changed and it is now placing US oil producers at a competitive disadvantage in global markets. For detailed discussion, see the Secure America’s Future Economy website, blog page,
10/5/15 entry.

Please advise if you have questions or we can be of further assistance.

Sincerely,
SAFE

**********RESPONSES**********

From Rep. John Carney, 10/6/15

Thank you for taking the time to contact me about the export of crude oil. I appreciate your input and thoughts on this important subject.

On February 4, 2015, Congressman Joe Barton (R-TX) introduced H.R. 702. This legislation would amend the Energy Policy and Conservation Act to repeal the restriction on the export of coal, petroleum products, natural gas, or petrochemical feedstock. Additionally this bill would repeal restrictions on the export of materials and equipment for energy facilities within the United States. Lastly, the bill would prohibit any federal office from imposing or enforcing any restriction on the export of crude oil.

While this is not a bill I have studied in depth, I appreciate your bringing it to my attention. H. R. 702 has been referred to the House Committee on Energy and Commerce and the House Committee on Foreign Affairs. I do not serve on either of these committees. That being said, knowing your interest and perspective, I will follow this bill through the legislative process with your thoughts in mind. Additionally, if this legislation comes before the full House of Representatives for a vote, I will be sure to consider your opinion and those of other constituents who contacted my office before taking a position on it.


10/9/15 – HR 702 passed the House 261-159 on a largely party line vote; Representative Carney voted against it.

From Senator Chris Coons, 11/5/15

Thank you for contacting my office to express your views about the current state of the crude oil export ban. I appreciate your taking the time to write to me about this issue.

As you may know, with a few exceptions, export of crude oil is currently prohibited in the United States. This ban dates back to 1975 with passage of the Energy Policy and Conservation Act (EPCA), which Congress passed as a response to the 1973 embargo of oil imports to the United States by the Organization of Arab Petroleum Exporting Countries. The 1973 oil embargo caused oil prices to nearly quadruple in the span of several months. The increase in oil prices shocked the U.S. economy and consumers and led to gasoline price controls and rationing. The ban on crude export was designed to keep crude oil in the U.S. to ensure its domestic use. Over the subsequent decades, the ban has had limited impact, because the U.S. continued to import increasing amounts of oil. This was due to growing demand and reduced domestic production which has persisted for more than three decades.

As a Member of the Senate, I am committed to finding ways to use all of our energy resources and enhance our energy independence by increasing efficiency, facilitating the growth of alternative fuels and vehicle options, and responsibly pursuing access to traditional sources of energy. I believe that successful energy and environmental policy must reflect the linkages between environmental protection, energy innovation, consumer protection, and economic growth. We must actively promote creativity and innovation in how we conserve and use our natural resources in order to maintain our global competitiveness and create the jobs of the future here in the U.S.

As a result of technological advances and federal policies related to efficiency gains, fuel alternatives, and renewed domestic production, U.S. supply and demand dynamics have shifted in recent years. Domestic oil production grew nearly 17 percent in 2014, reaching a 29-year high and helping reduce imports of foreign oil imports to a 19-year low. In addition, Corporate Average Fuel Economy (CAFE) vehicle standards have increased efficiency and reduced overall fuel demand. Of the transport fuels, biofuel consumption increase to approximately 10 percent of gasoline and 3 percent of diesel in 2014. I am actively working to support the research, development, and deployment of advanced, next generation biofuels that are not produced with feed crops, such as cellulosic ethanol, biodiesel, and drop-in fuels like bio-butanol.

You may be interested to know that the Commerce Department’s Bureau of Industry and Security (BIS) oversees such oil export matters. While crude oil exports are currently prohibited, there are still certain exemptions and circumstances under which crude oil exports are allowed. The BIS has authority to allow certain crude oil exports if an exemption is determined to be in the national interest. For example in August, the Commerce Department allowed for the exchange of U.S. crude with heavier Mexican crudes. Such oil swaps are one of several possible exemptions allowed.

I am aware that, with rapid increase in domestic oil production over the past few years, some Members of Congress have suggested removing the oil export ban. However, this would deserve a focused debate carefully weighing the potential benefits and drawbacks before lifting the ban. Currently the Energy Supply and Distribution Act of 2015, S.1312 is before the Senate Committee on Energy and Natural Resources. This bill would include, among other things, the allowance for the export of crude oil without a federal license. While I do not sit on this committee, you can be sure that I will continue monitoring these discussions. I would have difficulty supporting lifting the ban without corresponding considerations being given to consumers, refiners, and the environment. Further, I will keep your views in mind should this legislation come before the full Senate.

Again, thank you for contacting me. I am honored to represent Delaware in the United States Senate and truly value hearing from constituents on issues of concern. My website, www.coons.senate.gov, can provide additional details about my work in the Senate, including legislation and state projects. I value your input and hope you will continue to keep me informed of the issues that matter to you.

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