Ban on USA crude oil exports set to end

Congressional leaders agreed on a fiscal plan that would lift the 40-year-old ban on crude oil exports.

In order to attract Democrat votes, Republicans are including a number of provisions, including the extension of child care tax credits and renewable energy subsidies.

“There is now little if any incentive for United States oil producers to export crude oil even if the ban is lifted, ” he said on the council’s blog.

In a year that’s largely consisted of bad news for the US oil and gas industry, highlighted by OPEC’s refusal to curtail crude production, the formal blockage of the Keystone XL Pipeline by the Obama Administration, and a warm fall and winter throughout the USA that has greatly reduced heating demand, this announcement could see 2015 end on a high note.

“Ryan laid out a compelling case to support the deal”, which includes lifting the oil export ban, said Representative Reid Ribble of Wisconsin, Bloomberg reported. Total crude oil and petroleum product inventory in the USA, including strategic petroleum reserve, is now more than 2 billion barrels while commercial crude stockpile at 485 million barrels, levels not seen in at least 80 years.

“Louisiana would be a big beneficiary in terms of jobs and GDP as would all the oil-producing states, but the nation as a whole would also benefit in terms of national security”, Hecht said. It became one of many riders, unrelated policy changes stuffed into the budget bill in the hopes that it could be carried along into law like a stowaway on a ship.

The same low prices that generated momentum for lifting the ban could reduce its short-term economic impact, however, because the global market is saturated and US oil companies have already slowed drilling in response. A ban on oil exports was put in place in December 1975, with some exceptions. The extra carbon use, the Center for American Progress theorized earlier this year, would equal 135 coal-fired power plants.

“This is a bit of a lifeline for USA producers”, said Joe McMonigle, who served as chief of staff of the Energy Department under former President George W. Bush. Economists say exports could help the economy by reducing gasoline prices, encouraging investment in oil and gas production and transport, creating jobs, making oil and gas supplies more stable and reducing the US trade deficit. “We won some; we lost some”. The island’s non-voting House member, Pedro Pierluisi, had sought to include a provision in the spending bill to grant Puerto Rico agencies access to Chapter 9 bankruptcy.

As recently as Monday, White House press secretary Josh Earnest told reporters Obama would veto any standalone measure that would end the oil export ban. Also to be made permanent are an enhanced child tax credit and earned income tax credit, as well as tax breaks for charitable giving and schoolteachers’ expenses.

Obamacare. Republicans want to preserve a provision limiting how much the government can spend on “risk corridors” protecting insurers against financial losses under Obamacare. He has promised that text of the two bills would be posted for three days before they go to the House floor for a vote.

Congressional leaders are set to unveil the $1 trillion bill later this week ahead of a deadline to avoid a government shutdown, and reports indicated that Democrats could be willing to sign off on ending the ban in exchange for other environmental priorities.