- Staff Writer- Dallas Business Journal
U.S. Rep. Joe Barton, R-Texas, led the introduction of a bill to remove the decades-old ban on U.S. crude oil exports.
House Resolution 702 would remove the restrictions, freeing U.S. oil producers to ship their product to overseas markets. Much has changed since the export ban was put in place in the 1970s, mainly the ability to extract oil from shale using hydraulic fracking.
With the current oversupply of oil and precipitous drop in crude oil prices, it's no surprise that Barton and other mostly Texas lawmakers are pushing to lift the ban again.
Seems like a no-brainer to jumpstart a suddenly sluggish energy industry, right? Not so fast. Much like the argument against increasing the export of natural gas, there's concern about a widespread export of crude oil derailing efforts to make the United States energy independent. Putting domestic crude oil on the international market hurts refineries and could put pressure on fuel prices.
Here are key parts of the bill:
- Removes all restrictions on the export of crude oil and prohibits the federal government from imposing or interfering in that endeavor.
- Requires the U.S. Secretary of Energy to conduct a study on the appropriate size and purpose of the Strategic Petroleum Reserve.
This is separate from the tiny exception made for the export of condensate, an ultra-light oil that requires minimal processing. Irving-based Pioneer Natural Resources (NYSE: PXD) and other companies are taking advantage of that now.