The Chicago Tribune lauded rising oil and gas production as one of the good-news stories of 2013.
Next year could be even better, the paper said.
“Thanks to the extraction technique known as fracking, the U.S. is producing much more oil than was expected just a few years ago. Modern industrial economies run on oil, so a boost in domestic supply helps business to grow, and lessens the nation’s dependence on the volatile Middle East.”
But U.S. crude can be exported only if the federal government deems the shipments “consistent with the national interest.”
That vague legal standard has in effect made it impossible for oil producers to export crude, except a small amount sent to Canada, although exports of gasoline and other refined products have been soaring lately, the editorial said.
Drillers will miss out on billions of dollars in annual revenues from exports within a few years unless the ban is lifted.
“That additional business would translate into job creation as the oil industry invested in refineries and transportation networks to handle the light, high-quality crude being produced domestically. (Much of the U.S. oil infrastructure is geared for heavier crudes from Canada, Mexico and Venezuela.)”
Congress should have lifted the ban years ago, the Chicago Tribune said. “Politicians have been wary, however, fearing that exports will result in rising prices at the pump, and a backlash from voters.”
Those fears are misguided. The ban does nothing to keep domestic gasoline prices lower. The big winners are the operators of U.S. refineries that can buy light crude oil at depressed prices because there is nowhere else to process it. Those same refineries can sell their gasoline and other products at market prices, reaping a windfall. Producers, meantime, are stuck selling at a discount, or reluctantly leaving their oil in the ground.