Murkowski drive to end ban on crude oil exports inches forward

WASHINGTON -- Alaska Sen. Lisa Murkowski's push to lift the ban on exporting U.S. crude oil inched forward Tuesday with a critical Senate committee hearing on the issue.

But testimony from United Steelworkers President Leo Gerard revealed there is fervent opposition to lifting the ban, despite congressional discussion that has appeared dominated by Murkowski and other supporters of changing the law.

Gerard argued that exporting U.S. crude amounts to exporting U.S. refinery jobs. United Steelworkers represents workers at 63 refineries.

"Congress cannot overlook the negative impact lifting the crude oil ban will have on fuel prices, economic security and jobs," Gerard told the Committee on Banking, Housing and Urban Affairs.

"In extreme cases it could cause U.S. refineries to close, which could endanger supplies of other refined products such as home heating oil in the Northeast," Gerard said.

The U.S. banned exports of crude oil in the 1970s in the face of an energy crisis. Forty years later, still only refined products can leave the country, with some exceptions. But the nation's energy situation is remarkably different from what it was in the 1970s -- the country now exports more refined oil than it brings in from elsewhere, and the potential for production has skyrocketed.

Alaska is one of those exceptions to the rule: Oil produced on the North Slope can be exported. And last year, faced with prices edging Alaska oil out of the domestic market, crude left the port of Valdez headed to Asia for the first time in a decade.

Some who support ending the export ban argue it would give the state a new foothold in the Lower 48, where cheaper-to-produce crude is flooding refineries.

"Keep in mind that it is perfectly legal, fair, legitimate and done every day to send our refined products overseas. It is only the crude oil that we are limited," Murkowski told the Senate panel.

Murkowski first raised the issue a year and a half ago, she noted at the hearing -- first calling for studies into the potential economic impacts of lifting the ban, she said Tuesday. "And boy did they do the reports," Murkowski said, noting that more than a dozen reports looked at the impacts, particularly how exporting U.S. crude oil could affect what drivers spend at the gas station.

"That's what everybody really wants to know. We can talk about the high policy initiative, but at the end of the day they wanted to know, is it going to raise the price at the pump?" Murkowski said. The studies said it would not, Murkowski said.

Now, the U.S. should lift the ban and "become an energy superpower, to send a signal to the world that we are ready to lead on issues of energy and the environment, to empower our allies and to compete against our foes in a way that doesn't involve sending troops in … using our energy resources as a diplomatic tool, as a strategic asset to help lift up our economy, create jobs, while at the same time lowering gasoline prices and increasing domestic energy production," Murkowski said.

The ban on crude exports is particularly relevant while Congress considers extending highway funding by selling strategic petroleum reserves and whether to approve President Barack Obama's proposed nuclear agreement with Iran, Murkowski said.

"The deal that the administration has presented us concerning Iran's nuclear program will entail lifting the sanctions on Iranian oil in the near future," she said, arguing that it is unfair and financially unwise to allow Iran to sell crude oil where the U.S. cannot. Murkowski has made the argument before.

Both issues "illustrate just how important it is that we take up this ban," Murkowski said.

Afterward, Murkowski headed over to the Energy and Natural Resources Committee, which she chairs, to gavel in a marathon hearing on her major energy legislative package. The committee moved through 25 of 94 amendments filed by members, with plans to meet Wednesday to continue, including consideration of her latest bill to lift the ban on exporting U.S. crude.

Erica Martinson

Erica Martinson is Alaska Dispatch News' Washington, DC reporter, and she covers the legislation, regulation and litigation that impact the Last Frontier.  Erica came to ADN after years as a reporter covering energy at POLITICO. Before that, she covered environmental policy at a DC trade publication and worked at several New York dailies.