Senator plans bill to lift US oil export ban

The US Senate's leading advocate for a repeal of America's longstanding ban on oil exports plans to introduce a bill this year that would open the way for millions of barrels a day of crude sales into international markets.

Lisa Murkowski, a senator from oil-rich Alaska and chair of the energy committee, said on Monday that 2015 should be "the year of legislation" to lift the 40-year old ban on exporting most domestic US crude.

The ban is politically sensitive because lawmakers in both parties fear a repeal could lead to them being blamed for higher petrol prices, even though economists say there is no reason to fear a price spike at the pump.

Energy executives say the US public has not yet adjusted to the country's status as a shale superpower, noting that older citizens still recall fuel shortages and long petrol queues during the energy crises of the 1970s.

Speaking at the energy industry's annual CERA Week conference in Houston, Ms Murkowski said: "I am making clear today that I plan to introduce legislation that fully repeals our nation's outdated export ban."

She said the possible easing of sanctions against Iran, following agreement with the west over its nuclear ambitions, could lead to some 1m b/d of Iranian exports and that the US itself would lose out.

"The [US] export ban equates to a sanctions regime against ourselves," she said. "It hurts American consumers, whose prices at the pump are higher than they would be otherwise."

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Legislation to repeal the ban would face an uphill struggle in Congress for reasons beyond fears over the effect on petrol prices.

The issue pits Republicans who say exports will encourage more shale energy production against pro-ban Democrats who are worried about the environmental effects of more drilling.

Ryan Lance, chief executive of ConocoPhillips, described the ban as "anti-consumer" and said the senator's plan was "a good first step".

"Certainly I'm optimistic we can get something done in 2015. I recognise it's a long hill to climb," he said.

Ms Murkowski's announcement signalled that she had given up on her previous effort to urge the Obama administration to loosen the ban using its own executive authority.

Late last year the Obama administration tweaked the rules to allow more overseas sales of lightly processed oil called condensate, but Republicans said that was not enough.

As US shale producers cut back their activity due to the low oil price, most economists agree that large-scale US oil exports would lower the international oil price even further by increasing global supply.

But there is no consensus on the likely magnitude of the impact and exports could still help US producers' profits by closing a gap between the Brent crude price and the US crude price, known as West Texas Intermediate, which is about $7 per barrel below the international benchmark.

Ms Murkowksi also called for more exemptions to the ban under existing law, saying the US should be able to export crude to its Nato allies.

"Nothing prevents America's trading partners from asking us for exemptions . . . Why stop with just Canada and Mexico? Why not members of Nato, such as Italy, which relied on Libya for some 21 per cent of its oil, or Poland, which relies on Russia," said Ms Murkowski.

The senator has not yet decided whether she will put forward a standalone bill or attach it to a broader package of energy reforms or some other legislation, a spokesman said.

"She's maintaining her flexibility to maximise her chances of success," he said.

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