Obama to veto crude oil exports bill

U.S. President Obama’s Administration strongly opposes the House Rule 702, which would remove restrictions on the export of crude oil from the United States.

The Obama Administration on Wednesday issued a Statement of Administration policy in which it said why it opposed the oil export bill.

“Domestic oil production has grown in recent years, strengthening our economy, supporting new American jobs, and enhancing our energy security. The Administration has taken important steps to support safe and responsible production growth, including actions to cut methane leaks from oil and gas operations, to protect water quality, and to improve offshore safety in order to protect human lives and the environment from oil spills,” the statement reads.

“Legislation to remove crude export restrictions is not needed at this time. Rather, Congress should be focusing its efforts on supporting our transition to a low-carbon economy. It could do this through a variety of measures, including ending the billions of dollars a year in Federal subsidies provided to oil companies and instead investing in wind, solar, energy efficiency, and other clean technologies to meet America’s energy needs.”

The statement concludes that if the President were presented with H.R. 702, his senior advisors would recommend that he veto the bill.

In a bill in which the U.S. Congress calls “to adapt to changing crude oil market conditions”, it has been said that the Congress finds that the United States has enjoyed a renaissance in energy production, establishing the United States as the world’s leading oil producer.

Furthermore, the United States upholds a commitment to free trade and open markets and has consistently opposed attempts by other nations to restrict the free flow of energy.

Therefore, the Congress says, the United States should remove all restrictions on the export of crude oil, which will provide domestic economic benefits, enhanced energy security, and flexibility in foreign diplomacy.

Energy & Commerce Committee on crude oil exports ban 

On October 2, the Energy & Commerce Committee issued a Summary of a Bill to lift the ban on crude oil exports, authored by Rep. Joe Barton. 

The Committee says that the ban on crude oil exports, put in place in 1975 in response to the Arab oil embargo, was outdated, and harmful for the U.S. economy.

Pointing out that the U.S. is now one of the leading producers of oil in the world, the Summary calls for updating energy policy to reflect “21st-century realities.”

“…Iran and Russia use oil as a political weapon”- Energy & Commerce Committee

“Lifting the ban on exports has broad bipartisan support. The Energy Information Administration, think tanks across the political spectrum, and respected academic institutions like Harvard University, all agree that lifting the ban on exports would likely boost our energy production, create thousands of jobs, lower gasoline prices, increase our energy security, and weaken countries like Iran and Russia, who use oil as a political weapon. The president has entered into an agreement with the Iranians to export oil, and the U.S. should not be put at a competitive disadvantage,” it has been said in the Summary.

The Energy & Commerce Committee cited Congressional Budget Office saying that the lifting of the oil export ban would generate $1.4 billion in profits to the federal government over the next decade from oil and gas leases. The Committee further said the bill would allow the U.S. to help its allies, enhance its energy security, and weaken OPEC and Russia’s monopoly power. Also, it would strengthen the 60-Ship Maritime Security Fleet.

IPAA calls President to reconsider his position

Independent Petroleum Association of America (IPAA) President Barry Russell called on President Barack Obama to reconsider his position, and direct the U.S. Department of Commerce to lift the trade restrictions on American crude oil exports.

“Repealing the 40-year-old ban would stimulate our economy, strengthen America’s geopolitical standing around the world, and provide meaningful benefits to American families and our national energy security,” it has been said in IPAA’s press release.

The IPAA President said: “In recent weeks, we’ve heard President Obama make a passionate case for ‘leveling the playing field’ for American workers and businesses. However, it’s discouraging to see this White House negotiate a trans-pacific trade agreement and authorize Iran to export its oil, while America’s energy producers are left tightening their belts and shutting down their rigs. Shouldn’t American companies have the same competitive access to global markets?”

“Repealing the 1970s-era ban on U.S. crude oil exports would do just that. It would give America’s energy producers competitive access to global trade markets, which is consistent with President Obama’s own broad free trade policy priorities. Right now, President Obama has the administrative authority to put an end to these self-imposed trade restrictions. The president should go to bat for American workers and businesses by directing the Department of Commerce to lift the ban on crude exports. Failing to do so would be a major missed opportunity to stimulate the economy, strengthen our national energy security, and generate significant fuel savings for American families.”

Offshore Energy Today Staff