Lifting the ban on crude-oil exports would benefit major oil companies and hurt Americans, Senate Foreign Relations Committee Chairman Robert Menendez, D-N.J., said in a letter to President Obama on Monday.
Energy Secretary Ernest Moniz suggested last week that it was time to revisit the ban on crude-oil exports, which has been in place since the 1970s and restricts exports of the fuel in most cases. “Those restrictions on exports were born, as was the Department of Energy and the Strategic Petroleum Reserve, on oil disruptions,” Moniz said at a forum hosted by Platts.
Menendez, who has tried without success to repeal tax breaks for major international oil companies, joins Sen. Edward Markey, D-Mass., in raising concerns over the prospects of exporting crude oil. Menedez said in his letter that lifting the ban could increase gasoline prices in the United States.
“When Congress first enacted limits on crude exports in the 1970s following the oil embargo, these laws were designed to enhance American energy security and protect U.S. consumers from volatility and price spikes,” Menendez said in the letter. “Despite changes in the global energy market, these goals should remain priorities in our nation’s energy policy. Easing this ban might be a win for Big Oil, but it would hurt American consumers.”
The concerns raised by Menendez and Markey are the first vollies in what’s expected to be a protracted and politically tricky debate over whether Washington should allow exports of crude oil. Right now the U.S. only exports a small amount to Canada.
Senate Energy and Natural Resources Committee Chairman Ron Wyden, D-Ore., who has scrutinized the administration’s approval of projects to export natural gas, signaled a cautious willingness to debate the crude-oil ban.
“Senator Wyden is aware our country will have a debate over exporting crude oil in the near future,” spokeswoman Samantha Offerdahl said in an email to National Journal. “He’s willing to consider all policies and all options, so long as he sees evidence that those policies will result in clear benefits to the American consumer.”
Energy and Natural Resources ranking member Lisa Murkowski, R-Alaska, said the committee plans to hold a hearing on the broader issue of geopolitics and oil and natural gas early next year, likely January. She is also slated to give a major speech on fossil-fuel exports also on January 7, according to her office.