The U.S. ban on exporting oil may not live to see its 40th birthday.
There's growing momentum to kill the restriction and a deal could be reached before the end of the year as part of a broader spending and tax bill that's making its way through Congress.
Proponents argue the restriction is terribly outdated. It was signed into law on December 22, 1975 when the OPEC oil embargo created a shortage that slammed the American economy with skyrocketing prices.
No scarcity of oil
Today, the world has too much oil -- thanks largely to the American shale oil boom. That's why crude oil prices have crashed below $35 a barrel and a gallon of gasoline is on the verge of falling below $2 per gallon.
In other words, there is no longer an oil scarcity that justifies keeping it at home. In fact there's too much of it.Click here to continue reading the article.
Meanwhile, from Bloomberg:
Oil prices won’t be affected by U.S. crude exports, according to OPEC’s top official.
“The net effect of export of American oil on the market is zero,” Abdalla El-Badri, secretary-general of the Organization of Petroleum Exporting Countries, said Tuesday. “This will have no effect on the price because the U.S. still is an importing country.”
The U.S. Congress is nearing a deal on the biggest shift in the nation’s oil policy in more than a generation by allowing the world’s largest oil and gas producer to sell crude abroad. Pressure has been building to lift the ban as new drilling technologies unlocked reserves in shale formations, pushing output and stockpiles to records while punishing prices.Read that whole article by clicking here.
“They export some, but they need to import the same quantity from somewhere else,” El-Badri said in New Delhi. The U.S may export light oil produced from shale formation while still importing heavier types of crude, he said.
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