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Tuesday, March 19, 2024
March 19, 2024

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In Our View: Exporting Oil Bad Idea

Lift ban on crude export? Big Oil would win, consumers, environment would lose

The Columbian
Published:

Among the issues surrounding a proposed oil terminal at the Port of Vancouver is one currently bubbling in the halls of Congress.

Thursday, the U.S. Senate’s Energy and Natural Resources Committee held a hearing on a proposal to lift a 40-year-old ban on the export of crude oil. The ban was established as a reaction to the OPEC oil crisis of the 1970s, and its removal would have vast economic and environmental impacts. Those impacts would be particularly acute locally as they relate to the proposed Vancouver terminal.

The Port of Vancouver has reached an agreement with Tesoro Corp. and Savage Companies — collectively working as Vancouver Energy — to build the nation’s largest oil-by-rail terminal. The plan calls for a facility that could transfer up to 360,000 barrels of crude per day — about 15 million gallons — from oil trains to marine vessels for transport down the Columbia River to the Pacific Ocean. The proposal is undergoing review from state regulators and will be sent to Gov. Jay Inslee, who will have the final say.

The companies involved say the crude would be shipped to West Coast refineries, but critics have suggested that the long-term plan is to position Tesoro and Savage for overseas exporting. In a meeting with The Columbian’s Editorial Board late last year, Dan Riley, vice president of government affairs for Tesoro, said that the economics of the industry dictate sending the crude to domestic refineries. That provides little solace, however, as Riley added that there is “nothing written into the contract” to prevent crude from being shipped overseas.

Along with representing a failure on the part of port commissioners who approved the deal with Tesoro and Savage, that oversight highlights the issues involved with oil exports. Even if exports are allowed, limitations must be put in place to protect domestic consumers. Oil company officials are going to make decisions based upon economics and a desire to maximize profits, regardless of the impact on domestic markets.

As Sen. Maria Cantwell, D-Wash., said during the committee hearing: “Economic effects of oil and gas prices ripple through our economy. Lower oil prices act like a tax cut for the vast majority of Americans. No one wants to see the price at the pump go up.” And Sen. Joe Manchin, D-W.Va., suggested that exports should be limited as a percentage of how much oil is being extracted in the United States. “In West Virginia,” he said, “it would be hard for me to explain to the people, to grasp the whole world market, if you will, that if we start unfettered export, it would reduce the price of their gas. I think there’s a win-win here; we’ve just got to find it.”

The win-win is the difficult part. It is easy to surmise how allowing international exports would be a win for oil companies, providing them with an expanded market and allowing them to compete on a world stage. It is more difficult to determine how it would be a win for the American people.

As the United States enjoys a boom in oil production, common sense dictates that the oil should remain at home, providing American refinery jobs and reducing the nation’s reliance upon oil imports. Common sense also dictates that it is unconscionable that a Senate hearing featuring experts and legislators did not include a single mention of the environmental impact of exporting oil.

Lifting a ban on exports would be a bad idea for the United States, both economically and environmentally. And with Vancouver in the midst of the oil debate, that means it would be a bad idea for us.

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