U.S. House leaders heard testimony largely in support of lifting a ban on crude oil exports, though debate over OPEC's market role emerged on the margins.
The House Agriculture Committee heard testimony from industry leaders and experts largely in favor of lifting the 1970s-era ban on domestic crude oil exports. Chairman K. Michael Conway, R-Texas, said lifting the ban would have widespread benefits for the United States in the era of shale.
"Lifting the oil export ban will grow our economy, it will also improve our geopolitical position and it will lower gas prices," he said in a statement.
Arab members of the Organization of Petroleum Exporting Countries in the 1970s briefly cut oil exports to the United States in response to policies on Israel. U.S. leaders responded by banning exports of domestic crude oil.
When OPEC this year opted to keep production stable to secure a market position in the shale era that emerged four decades later, Texas officials saw an act of war.
With U.S. oil production at historic highs, thanks in part to an increase in production from shale deposits in Texas and North Dakota, some industry supporters have argued it's time to repeal that ban. Harold Hamm, chairman and chief executive officer at Continental Resources, among the largest players in North Dakota shale, said the ban is giving foreign owners of U.S. refineries leverage in the domestic market.
"Now the American renaissance is at risk due to two things — OPEC oil price manipulation and foreign conversion of U.S. refining capacity," he testified.
Experts testifying Wednesday in Washington said lifting the ban would put the price of U.S. oils closer to the international price. Hamm said the U.S. market has lost "$125 billion in revenue" and half a million industry workers are out of a job "thanks to OPEC's predatory pricing."
Terrence Duffy, president and chairman of CME Group in Chicago, said exports of refined petroleum products, which aren't covered exclusively by the ban, have increased while imports are down in part because of domestic production.
"OPEC has little to no power to raise oil prices," he said.
A report from the non-partisan Congressional Research Service finds some overseas refineries aren't designed to process lighter crude oil blends found in U.S. shale deposits.
