Two weeks ago, an oil tanker carrying a shipment of crude oil from the Eagle Ford Shale left the Port of Corpus Christi for Italy. Not long after, the first crude movement from the Houston Ship Channel departed for Switzerland late last week. These moves are historic for the U.S., as it comes less than a month after the federal government authorized the reversal of a 40-year ban on crude oil exports.
America’s inability to export its crude oil since the 1970s has sidelined its potential on the global energy stage. In the last five years, we’ve surpassed both Saudi Arabia and Russia as the world’s largest producer of oil and natural gas, and it’s only appropriate that we now take full advantage of this impressive feat. The benefits are too significant to ignore.
Trading energy resources in the global marketplace can help strengthen diplomatic alliances. Until recently, the U.S. was forced to sit idly by while Allies in Europe and East Asia grew increasingly dependent on energy resources from parts of the globe seeded with political turmoil. From the European Union’s (EU) reliance on Russian oil and gas reserves, to South Korea and Japan’s near 90 percent dependence on imports originating in the Middle East, it has long been clear: U.S. crude oil and gas exports will bolster security and allow for stronger relationships with our allies moving forward.
The potential for advancements abroad as a result of stable energy supply to our allies is undoubtedly impressive. But it is the economic growth here at home that will be felt the most by consumers.
As a result of the newfound abundance in oil supplies and diminished storage capacity, our nation’s oil and gas industry—responsible for 9.8 million jobs—has had no choice but to slow production in recent months. While lower energy prices are proof that the basic economic tenant of supply and demand still works, the country finds itself locked in a price war with other nations who would like to see the American energy renaissance falter. But according to analysis conducted last year by Columbia University, U.S. crude exports could increase domestic production of crude oil by as much as 1.2 million barrels daily through 2025. Such would help cement the rejuvenation of an industry that will ensure the economic success of the country.
Several other studies conducted over the last year concur with this same equation. Most notably, last year the Aspen Institute projected that domestic crude oil exports will lead to as many as 1.3 million direct and indirect supply chain jobs by 2020. An estimated 400,000 of these opportunities are expected to pop up specifically in our nation’s minority communities, resulting in desperately needed economic development for struggling Americans.
The forecast for the overall economy is just as bright. According to research conducted by ICF International and EnSys Energy, the impact could be much as $20 billion generated by 2020. And separate analysis by the non-partisan Congressional Budget Office late last year suggested crude exports would create $1.4 billion in economic revenue between 2016 and 2025.
Study after study confirms that ending this outdated policy makes sense for the economy. Now that the first tankers carrying American crude oil have set sail for foreign coastlines, the country is finally poised to effectively compete with countries such as Saudi Arabia and Russia. By realizing the country’s full energy potential in the global marketplace, the U.S. is poised to be an energy force to be reckoned with for decades to come.