Learn more about our policy experts.

Media Contacts

Angela Bradbery, Director of Communications
w. (202) 588-7741
c. (202) 503-6768
abradbery@citizen.org, Twitter

Barbara Holzer, Broadcast Manager
w. (202) 588-7716
bholzer@citizen.org

Karilyn Gower, Press Officer
w. (202) 588-7779
kgower@citizen.org

Other Important Links

Press Release Database
Citizen Vox blog
Texas Vox blog
Consumer Law and Policy blog
Energy Vox blog
Eyes on Trade blog
Facebook/publiccitizen

Follow us on Twitter

 

Jan. 6, 2014

Retaining Ban on Crude Exports Good for Consumers, Climate

Statement by Tyson Slocum, Director, Public Citizen’s Energy Program

Note: On Tuesday, U.S. Sen. Lisa Murkowski (R-Alaska) is expected to make a speech urging the lifting of the crude export ban.

The oil industry, aided by pending shifts in Senate committee leadership portending a pro-oil tilt, is executing a full-court press to undo a 39-year-old consumer protection: a virtual ban on exporting U.S.-produced oil. It’s easy to understand why Big Oil wants to nullify the ban: doing so will lead to higher gasoline prices for U.S. motorists and fatter profits for oil producers. What’s unclear is why the Obama administration, specifically the energy secretary, supports ending the ban.

The export ban keeps more of America’s surging domestic production here at home, which keeps the purchase price of some domestic crude benchmark prices a tad lower for refiners that buy it to turn it into finished products. But overall, America’s booming oil production isn’t having a big factor on global prices, which is why gasoline prices during Obama’s oil boom have increased 54 percent since 2009. Global oil infrastructure makes it relatively easy to physically deliver the commodity in most parts of the planet, so there are generally prevailing universal benchmark prices. As a result, Wall Street traders price oil based on global trends, and right now they’re chasing Chinese demand rather than bulging U.S. production.

While the domestic glut isn’t moving global benchmark prices, it is keeping U.S. gasoline prices down a tad, as the excess capacity means it’s cheaper for U.S. refiners to access select U.S. landlocked crude. That’s why some refiners oppose lifting the crude ban; they’re making a fortune exploiting the export loophole. There are no restrictions on exporting refined petroleum products. That’s why we’re exporting three million barrels of refined petroleum every day, and a Public Citizen analysis shows that absent those refined exports, gasoline prices would be as much as 3.5 percent cheaper.

If the oil were to be exported without first refining it, we likely would see a higher rate of exports, and therefore a bigger price increase for American motorists.

Because lifting the ban would cause U.S. benchmark oil prices to rise, companies likely would have a greater incentive to increase production. With all of the increased production coming from controversial fracking techniques, lifting the ban not only would raise gasoline prices for U.S. families, but would create bigger environmental headaches.

As our current domestic oil boom painfully illustrates, America cannot produce its way to affordable gasoline, since the underlying commodity price is set by factors outside our borders. As long as our economy remains tethered to oil, we won’t be able to deliver affordable or sustainable energy for our families. Renewable energy, energy efficiency, the electrification of the transportation sector and investments in a sustainable energy infrastructure provide the only path for future prosperity. Keeping the crude oil export ban in place is an important first step.

###

Copyright © 2014 Public Citizen. Some rights reserved. Non-commercial use of text and images in which Public Citizen holds the copyright is permitted, with attribution, under the terms and conditions of a Creative Commons License. This Web site is shared by Public Citizen Inc. and Public Citizen Foundation. Learn More about the distinction between these two components of Public Citizen.


Public Citizen, Inc. and Public Citizen Foundation

 

Together, two separate corporate entities called Public Citizen, Inc. and Public Citizen Foundation, Inc., form Public Citizen. Both entities are part of the same overall organization, and this Web site refers to the two organizations collectively as Public Citizen.

Although the work of the two components overlaps, some activities are done by one component and not the other. The primary distinction is with respect to lobbying activity. Public Citizen, Inc., an IRS § 501(c)(4) entity, lobbies Congress to advance Public Citizen’s mission of protecting public health and safety, advancing government transparency, and urging corporate accountability. Public Citizen Foundation, however, is an IRS § 501(c)(3) organization. Accordingly, its ability to engage in lobbying is limited by federal law, but it may receive donations that are tax-deductible by the contributor. Public Citizen Inc. does most of the lobbying activity discussed on the Public Citizen Web site. Public Citizen Foundation performs most of the litigation and education activities discussed on the Web site.

You may make a contribution to Public Citizen, Inc., Public Citizen Foundation, or both. Contributions to both organizations are used to support our public interest work. However, each Public Citizen component will use only the funds contributed directly to it to carry out the activities it conducts as part of Public Citizen’s mission. Only gifts to the Foundation are tax-deductible. Individuals who want to join Public Citizen should make a contribution to Public Citizen, Inc., which will not be tax deductible.

 

To become a member of Public Citizen, click here.
To become a member and make an additional tax-deductible donation to Public Citizen Foundation, click here.