The U.S. has a law that does not allow oil producers to export their product abroad, but it’s a holdover from a period when we were less energy independent. Now, the Energy Information Administration has found that allowing exports would boost prices for local producers and reduce prices at the pump for consumers. Read Senator Hoeven’s news release on the topic below.
— Official News Release, Senator Hoeven —
At a hearing of the Energy and Natural Resources committee, Senator John Hoeven this week questioned the head of the Energy Information Administration (EIA) on the impact to consumers of lifting the ban on crude oil exports.
EIA Administrator Adam Sieminski testified that because the price of gasoline at the pump is keyed to global crude oil prices, exporting more U.S. oil would increase supply on the world market, resulting in lower gasoline prices for American consumers at the pump.
“We’re working to pass legislation that will allow oil exports, which is important not just for our producers, but it will also help the consumer at the pump,” Hoeven said. “More supply – lower prices. That’s the information that the EIA provided to our committee. Everyone benefits from lifting the ban – consumers, producers and the nation.”
Hoeven also highlighted the imbalance in refinery capacity for heavy crude oil and light, sweet crude oil. Most refineries are equipped to refine a mix of heavy and light sweet crude oil.
However, they don’t have the capacity to keep up with the large volume of light sweet crude oil being produced in shale deposits like the Bakken. The senator asked Sieminski what modifications refineries could make to refine more light sweet crude, which would encourage more energy production, enhance U.S. energy security and help keep fuel prices affordable for consumers.
Sieminski said a report was recently completed addressing steps the refineries could take to expand their light sweet crude refining capacity, and additional, more detailed studies will be released in the coming months. Hoeven is working to get refineries in the US to expand their capacity to refine light sweet crude.