The beginning of October 2015 was an absolutely historic moment in the power and oil sector where the House voted to lift the 40-year-old ban on the export of U.S. crude oil that has been in place since 1975 during the height of the Arab oil embargo. Lawmakers voted 261 to 159 to ending the 40-year prohibition. For oil producers and lawmakers from oil-producing states, the repeal is seen as a way to find new markets for American energy and to bring back jobs to districts that have been hit hard from the excess supply by allowing American fuel to be sold overseas.
(Learn more about the benefits here.)
While many Republicans have come out in favor of the idea, the vote has fueled a clash with most Democrats, including President Barack Obama. President Obama sent out a powerful message to Congress and to the American public regarding the issue. He states that the administration is unlikely to sign off on any measures expanding fossil fuel production and sales even if those measures carry economic benefits for the country. Presidential candidate Hillary Clinton added on with the negative ramifications that the lifting of the ban could have on the environment. This supports many environmental groups who also oppose the lifting of the ban, arguing that doing so could further stimulate production of fossil fuels.
George Baker, executive director of the coalition of more than a dozen oil companies such as Marathon Oil Corp and Apache Corp states, “this is a vote to level the playing field for U.S. workers and businesses who should be allowed to compete against foreign oil suppliers like Iran and Russia.” Baker continues by stating various benefits that the lift could have on the American public. Allowing oil exports would not only provide equal opportunities but also eliminate the market distortions, create jobs, and stimulate more U.S. petroleum production, which has increased significantly (80%) since 2008.
(Learn more about the vote here.)
Regardless of the benefits, the White House plans on threatening to veto the bill. They believe that Congress should focus its efforts on supporting transitions to a low-carbon economy.
Currently, 235 Republicans and 26 Democrats supported the bill. These numbers are short of the 290 needed to override a presidential veto.
While this is currently still a heated topic, some politicians are going a different route stating the ban no longer holds value. According to a report released this year by the Energy Information Administration, the U.S. may achieve energy interdependence between 2020 or 2030. For them, tinkering with the import and export won’t change things. What matters is who has the oil and how much.
So the questions remain. Should the ban be lifted? Do the benefits outweigh the costs? Is this the right move for the American public? For now, we can only just watch. The chess pieces are already at play. Let’s just hope we see our futures with a checkmate.