Lift ban on oil exports, Vallourec official urges

When the federal government announced recently that the U.S. economy actually shrank during the first quarter of 2015, people in Northeast Ohio weren’t surprised. The Great Recession hit particularly hard here, and the recovery over the past seven years has been shaky and slow.

Our leaders should be looking for every possible way to boost economic growth. Here’s one idea that would provide surprisingly strong benefits in Ohio and throughout the Midwest: Lift the current ban on U.S. crude-oil exports.

The oil and natural-gas industry supports more than 250,000 jobs in the Buckeye State, according to a recent study by PriceWaterhouseCoopers.

OPEN NEW MARKETS

Allowing oil exports would provide U.S. producers with new markets for the relatively high-quality crude that they are unable to refine here at home, which forces them to sell high-quality crude for below-market prices. Being able to sell that crude at better prices means higher profits, and that leads to more investment and more jobs – and not only jobs at relatively big companies like mine.

Many oil-industry jobs here are found at small and medium-sized firms that provide a range of products and services to the industry in the state and around the country.

IMPACT ON GAS PRICES

Lifting the ban would help the economy in another important way. Several studies by a variety of government agencies, universities and independent nonprofit groups show that the ban on crude exports raises domestic gasoline prices. The amount varies from state to state, but it can be as high as 13 cents a gallon. That’s money that drivers would have to spend or invest elsewhere.

The ban also harms our national security by preventing U.S. oil producers from competing in global markets. That’s a boon to other producers, many of which are not countries that we should be helping by sitting on the sidelines.

For example, Russia and Venezuela sell more oil around the world because we can’t. Iranian sales are currently hampered by international economic sanctions, but Iran would quickly become a major player again if the pending deal regarding nuclear-weapons development is signed.

TIMES HAVE CHANGED

The federal government imposed the ban on crude-oil exports in the mid-1970s when supplies were tight and domestic production was falling because they hoped it would improve America’s economic and national security. Perhaps that was true at the time, but things have changed significantly since then.

Now the ban is doing just the opposite – eroding economic and national security. It’s time for Congress to lift it.

Douglas Polk is vice president of industry affairs at Vallourec Star Corp., which has facilities in Youngstown. He also serves as secretary on the Board of Directors of the National Ocean Industries Association.