WALL STREET JOURNAL: A long-awaited study by the Obama administration concludes that lifting the nation’s four-decade ban on oil exports wouldn’t increase U.S. gasoline prices and could even help lower them, raising the stakes in the debate about whether to lift or relax the ban.
The report, issued Tuesday by the U.S. Energy Information Administration, an analytic division of the Energy Department, is expected to provide momentum to efforts by the oil industry and its supporters in Congress eager to end the ban and tap higher-priced foreign buyers amid surging global supplies and a market rout that has dragged prices to six-year lows…
The report, whose findings are laden with caveats, said price impacts ultimately were dependent on the complex intricacies of the oil market. Still, it concluded that removal of export restrictions would encourage oil companies to produce more crude as they attempt to capture higher overseas prices, which in turn would press global prices lower if foreign producers don’t reduce their own output… (more)
EDITOR: It may be appropriate to remove the ban as a matter of good public policy. It serves to artificially lower US petroleum prices by prohibiting sales abroad where prices are higher.
But the suggestion that this will somehow lead to lower US prices is absurd, as any first year student of Economics would recognize. It is strictly oil company propaganda.
What higher prices will do is discourage consumption of gasoline by US consumers. In the long run, that might be a good thing.
Refined oil products like gasoline, kerosene, heating oil, etc are already exported. The U.S. keeps trying to block Russian exports of oil and natural gas. This is part of the strategy since Europe depends on Russia for all forms of energy. Obama people are also pushing for natural gas exports which is absurd because the cost of exporting it is going to make American fracked gas more expensive here and way more expensive than Russian gas supplied by pipeline. Just more silliness where our energy companies get to determine our foreign policies.
I think the thought is that the price of West Texas Intermediate may rise slightly (more demand for American oil) and the price of Brent crude might tick slightly lower (increased supply. American oil now on international market). It’s said that since we in the northeast import much of our oil (it’s Brent), the price might be slightly lower than it is now with the export ban in place.