What’s all this I hear about exporting oil and natural gas?

Thanks to the shale energy revolution, the United States has ample reserves of natural gas to meet needs here at home while also supplying friendly buyers abroad – bringing overseas wealth into this country while helping to stimulate more domestic production and creating new jobs. This is an amazing opportunity given that just a few years ago the U.S. was expected to be a natural gas importer.

According to a 2013 study from ICF International, liquefied natural gas (LNG) exports will result in average net job growth of between 73,100 and 452,300 between 2016 and 2035. In addition, each LNG export terminal to be built represents up to $10 billion in investment in our economy. In 2012, the Energy Department commissioned a major study on the economic impacts of LNG exports, and it concluded that “the U.S. would experience net economic benefits from increased LNG exports,” including net benefits for consumers.

Shale development also is dramatically boosting U.S. crude oil production. The International Energy Agency estimates the U.S. will be the world’s leading oil producer by 2015. As a result policymakers are discussing whether to lift a 1970s-era ban on oil exports that was imposed when domestic supplies were scarce. Lifting the ban would allow growing new supplies of light sweet crude, largely developed from shale, to reach market. This is restricted now because many U.S. refineries are configured to process heavier types of crude. As Energy Secretary Ernest Moniz  stated in May 2014, “The issue of crude oil exports is under consideration. … A driver for this consideration is that the nature of the oil we’re producing may not be well matched to our current refinery capacity.”

A May 2014 report from IHS CERA found that lifting the ban on oil exports would add more than $1 trillion to government revenues through 2030 and create an average of more than 300,000 jobs per year. Importantly, IHS also found that this expanded trade opportunity would introduce a large new supply of oil into global markets and reduce gasoline prices for U.S. motorists. IHS:

“The additional crude oil supply that would be generated if exports restrictions were removed would lower gasoline prices by an annual average of 8 cents per gallon. The combined savings for US motorists during the 2016-2030 period would translate to $265 billion compared to a situation where the restrictive trade policy remains in place.”

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