Thu May 29, 2014
Lifting Ban On Crude Oil Exports Would Boost U.S. Economy
Originally published on Thu May 29, 2014 7:33 am
STEVE INSKEEP, HOST:
NPR's Business News starts with something a little crude. A new study is recommending the United States end its four-decade ban on crude oil exports. The report by the energy branch of the global consulting firm IHS says ending the ban would lower gasoline prices, create jobs and boost government revenues. NPR's John Ydstie has more.
JOHN YDSTIE, BYLINE: The ban on crude oil exports was implemented in the 1970s, during an era of U.S. price controls and declining U.S. production. IHS Vice Chairman Daniel Yergin says ending the ban would create a broader market for now booming U.S. oil production. He says that would boost the amount of crude oil in the global market and lead to cheaper global gasoline prices.
DANIEL YERGIN: And that, in turn, would flow back into the U.S. - back to the gasoline pump - and would be about 8 cents a gallon less for American motorists than would otherwise be the case.
YDSTIE: U.S. gasoline prices are influenced by the global market because the U.S. already imports and exports gasoline. Yergin says the IHS study finds that the larger market for U.S. crude would boost U.S. production by 1.2 million barrels a day.
YERGIN: At the peak, it will translate into almost a million more jobs. And over the forecast period, it would translate into $1.3 trillion more government revenues.
YDSTIE: That would be the total over a 15-year period. The IHS study was funded by energy companies, many of which would benefit from a broader market for U.S. crude. But some refiners oppose lifting the ban because the large supplies of U.S. crude in the domestic market mean they can pay less for crude oil and make higher margins by shipping refined products abroad.
Some environmentalists oppose lifting the ban, arguing it will only encourage further use of fossil fuels. The left-leaning organization Center for American Progress also wants to keep the ban in place. It points to higher gasoline prices than emerged on the West Coast in the 1990s, when the export ban on Alaskan oil was temporarily lifted. John Ydstie, NPR News, Washington. Transcript provided by NPR, Copyright NPR.