The United States government has approved at least four licenses to export crude oil to Europe, for the first time in years, showing how companies are breaking through the limits of the export ban established in the 1970s, according to Reuters which learned about the fact from a Freedom of Information Act request.
The Department of Commerce authorized two licenses to export U.S. crude to the UK since last year, totaling 1.8 billion dollars, and two more to Italy, totaling 3.12 billion, Reuters said Tuesday.
One license to export to Germany, totaling 2.6 billion, was filed in January and is awaiting a decision by the Bureau of Industry and Security (BIS), the government agency that reviews requests to export crude under the 1975 ban that prohibits most crude shipments except to Canada and re-exporting foreign oil, along with a few other exceptions.
These are the first licenses to allow crude exporting to the U.K. since at least 2000 and the first to any European country since 2008, according to the BIS, which has approved 120 licenses since January of last year. Ninety percent of those requests were sales to Canada.
The permits will likely add to a debate in Washington over whether or not to lift the ban as the rise in shale oil production inches closer to saturating domestic refineries. Allowing companies to export within the current law may set back a firm decision from the Obama administration on whether to annul the ban.
US oil production has climbed to its highest in 25 years. Many oil producers have lobbied for an end to the export ban, which would open up new markets for them. US refiners have opposed lifting or easing the ban, as they benefit from cheaper domestic crude. Foreign refiners may benefit from US exports to Europe, since access to cheap, high-quality US shale oil would improve their margins.
Licenses for exports to central America and Asia have regularly been approved over the past decade, for exports of heavy Californian crude or re-exports of foreign-produced oil. But companies have rarely applied to export to European countries or been approved. Two licenses filed in 2011 for exports to Switzerland and one for exports to the Netherlands were denied.
Applicants for export licenses must demonstrate that the trade is in the national interest, that they cannot sell the oil in the US for a reasonable price, and that the exports will end if US supplies are in danger of drying up.
The potential for exports is an outgrowth of the huge US shale oil production boom of the past decade, especially in the Bakken oil formation in North Dakota. The issue became one of the biggest of the year after US Energy Secretary Ernest Moniz in December suggested the ban was outdated.
Canada which has been the main oil supplier to the US is also having to review its sales strategy: Canadian oil sands producers have begun exploring ways to increase exports of their deeply discounted crude, most of which is now bound for the United States.
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As I told Toby, Stevie, Think, etc etc etc. The USA's oil is going to change world dynamics and will get the USA rocking in the next decade.Feb 06th, 2014 - 01:48 pm 0
As soon as the dark days of the Obama Administration are past people will start investing again.
USA companies are sitting on U$ 7 TRILLION waiting for him to leave.
http://en.mercopress.com/2014/02/05/us-the-world-s-largest-producer-of-oil-approves-licenses-to-export-crude-to-europe#comment305934: So, rather than investing and making money now, US corporations have gone on strike to punish Obama. Do you honestly believe that?Feb 06th, 2014 - 03:50 pm 0
Apple, Microsoft, Google, Phizer, Cisco, Oracle and Qualcomm make up almost half of the cash hording. Much of the holdings are overseas. However, it’s not Obama per se that they are punishing, it’s the current tax regulations. To suggest otherwise is siding with the trolls that American corporations do nothing in the interest of the people, which to an extent is true. Thought I do not believe that they are outright doing this, damaging the country to hurt Obama, they are stock piling and damaging the country because of the profit motive. Corporations, American or foreign own nothing to the country or people and never will, though there are corporations where people are first balanced with profits.Feb 06th, 2014 - 04:14 pm 0