Continental Resources Inc. founder Harold Hamm said the country's crude oil export ban plays into a "deliberate, calculated takeover of American refining" by foreign countries and companies.
Those foreign interests have converted US-located refineries to process their heavy, sour crude, he said. And the export ban blocks US producers' access to refineries abroad that can process their light, sweet crude.
"Basically, they took over America's refining capacity without firing a shot," Hamm said in an interview with EnergyWire. "It would be like farmers raising cotton that couldn't get their cotton ginned." [more]
A crisis flares in the Middle East. Russian military forces subjugate a nation desperate for freedom. Europe searches for new sources of energy.
Such was the situation in 1956. War raged over the Suez Canal, blocking shipping for half a year, and a crucial pipeline from the Persian Gulf to the Mediterranean Sea was sabotaged. Meanwhile, the Hungarian people rose up against their communist oppressors in October, precipitating a Soviet invasion days later. The Cold War turned hot and, as winter approached, American allies in Europe lost access to Middle Eastern oil.
President Dwight Eisenhower’s response was swift and resolute. Domestic oil production skyrocketed and shipments from the Gulf Coast stabilized world markets during this critical period, all to relieve what the press termed “Europe’s oil famine.” A study by the Rand Corporation in 1962 noted, “Both economically and politically (as was seen at the time of Suez), Europe’s essential energy needs involve the United States and other Western Hemisphere suppliers.” By July 1957, the crisis was over. American energy had come to the rescue.
Today, US allies are once again under threat and, once again, our nation’s resource abundance places us in a position to render vital assistance. [full story]
With crude oil supply in flood stage and prices downshifting, America’s political elite still finds itself unable to lift the outdated ban on US exports of crude oil.
Ditching the export ban, Baker Institute research shows, would accomplish at least two worthy goals. First, it would raise domestic prices of US crude oil, providing relief to the struggling US shale patch. Second, allowing US crude to reach global markets might reduce international crude prices, which would, in turn, reduce gasoline prices.
This unlikely sounding scenario is possible because the ban has led to a glut of un-exportable light crude that is sitting in storage tanks around America. Since it cannot reach international markets and U.S. refining sector is not configured to run this much light crude oil, American crude sells at prices well below those of comparable international grades. [more]