CRADDICK: “Lifting the Antiquated US Crude Oil Export Ban Will Be Monumental”

The United States lifted a 40-year ban on oil exports on Friday (Dec 18), marking a historic shift for the booming U.S. oil industry.

“The major disappointment in the deal is the lifting of the ban on exporting US crude oil”, said Rhea Suh, the group’s president.

Longson added that once USA producers go back to ramping up production, exports could become more beneficial.

Lifting the ban may also trigger a hiring frenzy for traders and shipping schedulers in Houston, as USA oil producers that never before had a presence in overseas markets build trading desks, said Christopher Geier, an energy investment banker at Sikich Investment Banking in Chicago. In fact, production in a number of individual states is outpacing some of the world’s top energy-producing nations.

Refiners have been the largest benefactor of the USA shale oil boom as refineries capitalized off the so-called crack spread between cheap energy costs and more profitable refined gasoline and diesel – the U.S.is the world’s largest exporter of gasoline and diesel.

None of that is likely to happen soon, as the world now has an overabundance of oil and prices are the lowest they’ve been in seven years, so the economic incentive to export oil isn’t there.

Technology. U.S. energy companies have developed new techniques that have dramatically increased oil production from fields once thought to be virtually empty or unreachable. On Wednesday, a report from the U.S. Power Info Administration stunned Wall Road by revealing that home inventories jumped four.eight million barrels, a lot bigger than a forecast for 1.42 million barrels.

Crude oil exports will benefit the US energy industry.

President Barack Obama had threatened to veto separate legislation lifting the export ban, but the White House isn’t expected to oppose the overall spending bill simply because it includes the measure, according to congressional aides. The U.S. benchmark slid below $35 a barrel Monday for the first time since February 2009. In response, USA companies are cutting costs and slashing spending on new drilling as they try to preserve cash flow and stay in business. Congress passed the act after an oil embargo by the Organization of Arab Petroleum Exporting Countries (OAPEC) against the US, Canada, and three other nations caused the per-barrel price of oil to quadruple between October 1973 and March of the following year. In return, they agreed to the demand from Democrats for a five-year extension of credits for wind and solar energy producers and a renewal of a land and water conservation fund. Democrats also blocked a push by Republicans to GOP proposals to impede Obama administration clean air and water regulations.

“I think in the long-term, it should mean better prices for Wyoming operators”, he said.

While many Democrats found lifting the export ban a bitter pill, Ryan could not resist a little gloating.

The provision in the package “prohibits any federal government official from imposing or enforcing any restriction on crude oil exports except in certain limited instances such as a national emergency declared by the President”.