Congressional Democrats revived a proposal Thursday to reinstate a fossil fuels export ban in a multipronged bid to lower the price of natural gas and petroleum products while decreasing fossil fuel production to combat climate change.
The measure, spearheaded by Democratic Sen. Edward J. Markey of Massachusetts, would curb oil and natural gas from going overseas and mirrors previous Democratic proposals made whenever gasoline prices have risen.
“For far too long, oil and gas companies have padded pockets at the expense of American consumers and front-line communities all while fueling our global climate crisis,” Mr. Markey said.
“I am sick of Big Oil’s sob stories about the need to increase domestic oil production as they simultaneously clamor to export more and more fossil fuels overseas,” he said.
However, the effects of an export ban on consumer prices are not as clear-cut as proponents may claim.
Congress lifted a 40-year oil export ban in 2015, a major win at the time for the oil industry and Republican proponents. Energy analysts fear reimplementing a ban would actually raise prices because it would limit global supply and kneecap incentives for domestic production.
Mr. Markey argued that such claims defy “what we learned in Economics 101,” despite his push for decreased output for environmental reasons.
“The oil and gas industry will reap the largest, highest price that they can extract as the oil and gas is out on the high seas. High bidders will come in, including those from China,” he told The Washington Times. “But for the people in Louisiana, Texas and other states across our country, they are the ones who would really pay the price with higher bills and greater exposure to environmental risks for their families.”
Sen. Dan Sullivan, Alaska Republican, countered that the “real choke point in terms of driving up [natural] gas prices” is the need to overhaul the country’s permitting process to bring more production online.
“When you shut down or delay pipelines all across the country, the number of pipelines that have been delayed — the price increase is very directly correlated,” he told The Times.
Since the oil-export ban was lifted, U.S. oil exports has skyrocketed more than six-fold from roughly 500,000 in 2015 barrels per day to about 3.6 million in 2022, according to the U.S. Energy Information Administration.
But U.S. oil production has increased by nearly the same amount from about 9.5 million barrels per day in 2015 to around 12 million in 2022.
U.S. natural gas prices remain a fraction of those paid by European consumers, but exports have increased substantially in recent years, particularly as Europe looks to ditch its reliance on the Russian energy source.
Since 2017, the U.S. has been an annual net exporter of natural gas.
The nonpartisan U.S. Government Accountability Office concluded in a 2020 analysis on the effects of the oil-export ban that producers could charge higher prices compared to foreign oil once it was lifted, incentivizing domestic oil production.
Refiners, meanwhile, saw decreased profit margins from more expensive crude oil but could not pass along the cost increases to consumers “because gasoline prices are largely determined on the global market.”
But even amid intense pressure when gas prices spiked in 2022 resulting from the war in Ukraine and lack of oil supply as economies emerged from pandemic lockdowns, the Biden administration did not weigh an export ban due to fears it would further raise prices.
• Ramsey Touchberry can be reached at rtouchberry@washingtontimes.com.
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