Over the past several months, many great minds have debated the economic impact of lifting the crude export ban. Here are some of major findings from five different studies, each conducted by a separate organization. While they all have their individual focuses and conclusions, the overarching messaging is consistent: Rescinding the ban would be a socioeconomic boon to the nation.
- Navigating the US Oil Export Debate
Center on Global Energy Policy (Released January 16, 2015)
Removing current crude oil export constraints could prevent a slowdown US oil production growth by allowing domestic producers to compete in global markets and lessening the impact of our domestic light crude refining capacity shortage. As a result, the US could see an increase in crude production of up to 1.2 million barrels per day between now and 2025. These elements would increase our integration into the global energy market, strengthening the nation’s resiliency to international supply disruptions and creating greater US diplomatic leverage as we solidify our current crude trade relationships and forge strong ties with new trade partners.
- Changing Markets: Economic Opportunities from Lifting the US Ban on Crude Oil Exports
The Brookings Institution (Released September 9, 2014)
The US will inevitably benefit across the board if the crude oil export ban is lifted – from overall economic growth and trade to wages and employment. By rescinding the current crude export restrictions this year, we could be looking at a .4% increase in GDP for 2015, along with reduced unemployment at an average annual reduction of 200,000 jobs through 2020. In addition to strengthening our domestic economy, we have the opportunity to play the part of international energy role model: We have encouraged the world to open its doors to free trade for more than half a century, and our seeming unwillingness to follow suit could serve as an isolationist barrier to our foreign relations.
- The Impacts of US Crude Oil Exports on Domestic Crude Production, GDP, Employment, Trade, and Consumer Costs
ICF International (Released March 31, 2014)
Expanding US exports of crude oil would trim the US trade deficit by as much as $22.3 billion in 2020. This decision could also result in robust additional investments in US exploration, development, and production of crude oil – in the manner of anywhere from $15.2 billion to $70.2 billion between 2015 and 2020. In a scenario where we export our crude into the global energy market, our GDP could expand by $38.1 billion in 2020. Another result would be our ability to increase domestic refinery throughput by upwards of 100,000 barrels per day because current refinery bottlenecks (caused by “mismatched” crudes) could be assuaged by exchanging crudes in the world market.
- US Crude Oil Export Decision: Assessing the impact of the export ban and free trade on the US Economy
IHS (Released March 2014)
Lifting the crude oil export ban supports economic activity across all states – in fact, one fourth of the additional jobs created as a result are likely to be found in non-producing states. The ensuing rise in economic activity as crude production increases could support an additional 394,000 jobs over the 2016-2030 period. And this is an average: The study projects upwards of 811,000- 964,000 new jobs could be launched during a peak period in 2017-2018 if we take action to rescind the ban this year. Americans’ disposable income would also increase as a result of increased crude export, with an average additional $391 per household in 2018.
- Crude Behavior: How Lifting the Export Ban Reduces Gasoline Prices in the United States
Resources for the Future (Released February 2014)
Findings: The worldwide system of refinery operations stands to gain immensely if the ban on US exports of crude oil could be lifted – bringing not only lower oil prices but also greater economic strength. Before the technological advancements that led to the fracking revolution, global oil production focused on heavier crudes. In response, many US refiners invested in facilities that convert these heavier crudes into the lighter, more valuable products like gasoline, jet fuel, and diesel – while foreign refiners, in contrast, kept their operations working with lighter crude oils. Now that domestic shale is revealing considerably more light crude, our current export ban is a double-edged sword: This surplus is prohibited from reaching foreign refineries, and its overabundance means that there’s no room to accommodate the heavier crudes produced elsewhere from being refined here.
