Republican U.S. Rep. Joe Barton’s campaign to end the 40-year ban on exporting American crude oil, a potential boon to his home state of Texas, has some real traction and may be included in the catch-all funding bill Congress must pass next week.
There is a catch: Negotiators are sparring over what else to include to attract Democratic voters, and the export ban is tied to the restoration of wind and solar energy tax credits, part of a package of dozens of so-called tax extenders, including one important to Texas – the deductibility of state and local sales taxes on federal returns.
Barton’s bill passed the House of Representatives in October and was also attached to another bill, but the best chance for passage is in the coming week as lawmakers horse-trade over the omnibus bill, which would fund the federal government this fiscal year.
The United States is now the largest petroleum and natural gas producer in the world.
U.S. Chamber of Commerce
“Congressman Barton is very hopeful that lifting the ban on crude exports will be included in the omnibus. He has been in touch with leadership and other key stakeholders to help carry this important legislation across the finish line,” said Daniel Rhea, Barton’s spokesman, in an email to McClatchy.
In a statement after the House passed the bill in October, Barton said, “In Texas, we have seen our economy grow by leaps and bounds due in large part to the boom in energy production. Lifting the ban on exports will allow our state's economy to continue this growth pattern and benefit all Texans.”
The domestic ban on exporting crude oil was imposed by Congress and signed by President Gerald Ford in 1975 as the U.S. response to the Arab oil embargo that limited production and drove up prices. Decades later, opponents of the ban, especially in the oil industry, say it hurts domestic producers who have ratcheted up production, especially from oil shale.
“This is not a regional issue. This is not an oil patch issue,” Barton said when his bill passed the House. “This is an American issue. America’s energy boom has sparked a jobs boom, but continued job growth is now in jeopardy without access to global markets.”
Independent Petroleum Association of America President Barry Russell said in a statement that lifting the ban “is critical to independent producers – small businesses with an average of 15 employees. IPAA urges the U.S. Senate to move swiftly and allow competitive American oil exports that create jobs, grow our economy and keep our gasoline prices low.”
Lifting the ban on oil and all the money that that means for the oil industry, while they can’t index for children, it’s just, it’s too big.
House Minority Leader Nancy Pelosi
The debate is now about how to package the crude oil and tax extenders. But House Democratic leader Nancy Pelosi, D-Calif., said Friday that she opposed attaching the tax bill, which includes a research and development tax credit and other tax breaks, to the omnibus bill.
“I don’t see very much support on the Democratic side for the tax extender bill,” she said. “It includes hundreds of billions of dollars in permanent tax breaks for special interests and big corporations while neglecting hardworking families.”
“Lifting the ban on oil and all the money that that means for the oil industry, while they can’t index for children, it’s just, it’s too big,” Pelosi said. “It’s unfair, and it does not have the support of House Democrats.”
The White House also opposes the measure. “We have opposed legislative action that would lift the ban on crude oil exports, primarily because this is already authority that rests with the executive branch,” White House spokesman Josh Earnest said Friday at the White House briefing.
But House tax-writing negotiators, led by House Ways & Means Committee Chairman Kevin Brady, R-Texas, were expected to continue talks with budget leaders and Senate members with an omnibus bill to be made public Monday, according to House Speaker Paul Ryan, R-Wis.
And with some strong support in the Senate – such as Democratic Sen. Heidi Heitkamp of North Dakota, who represents the high-growth shale oil region – as well as from oil-state lawmakers in the House, supporters hope the provision lifting the ban makes the final cut.