Tuesday, October 6, 2015

Ending U.S. Oil Export Gains Ground

Ending the U.S. Oil Export Ban Is an Empty Gesture
An Alaskan oil pipeline

Though it may not necessarily become policy anytime soon, sentiment towards ending the U.S. oil export ban in 1975 has certainly gained traction in both sides of Congress. To many, this would seem like a move that would widen the market for oil and thus bring more competitive prices. Furthermore, this would also bring more jobs to Americans. As usual, while many Republicans support the bill, various Democrats have various reservations about lifting the ban, including Hilary Clinton, who has voiced her concern about the environmental risks that come with lifting the ban.

The 1940's and 1950's were times of cheap oil prices. This, in conjunction to the booming popularity of automotives, became the grounds for heated oil debates. Wary of the notion that cheap oil from the Middle East would flood the American markets, politicians enacted measures to regulate the flow of exports and imports of oil. A ban on the export of crude oil to all nations except Canada without a special license in 1947, thus keeping the vast reserve of oil. In the 1950's, oil policy changed under Eisenhower, limiting the imports of oil. By 1973, however, Nixon, who was pressured by the depleting supply of American oil, loosened the policy on imports of oil, but due to the OAPEC's enactment of the oil embargo, little was achieved. Finally, in 1975, President Ford decided that in order to tackle the problem with foreign oil dependency, the demand for foreign oil should be lowered my banning the export of domestic oil, thus enforcing Americans to use domestic oil instead of foreign oil.

Ulimately, since oil production in the United States has shot up since then, and oil in general is quite cheap today, is it safe to once again lift the ban on exports of domestic oil? Doing so would widen our markets and generate profit for American companies. Or should we perhaps maintain the ban to conserve not only the precious resource of oil and conserve the environment? Would going this route cause us to deplete available oil resources once again?  Given the constant flip-flop of policy on oil, is export-import oriented policy even effective and relevant in making long term and effective changes?

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