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No change in oil export policy, White House says

Government rules allow for export of some oil taken from U.S. shale basins.

By Daniel J. Graeber

WASHINGTON, Jan. 14 (UPI) -- There has been no change in U.S. policy regarding the export of domestically produced crude oil, the president's spokesman said.

U.S. Energy Information Administration Administrator Adam Sieminski said that, while low crude oil prices are slowing the rate at which domestic oil production is increasing, exploration and production activity is still accelerating at a record pace.

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"Drilling activity is expected to increase and U.S. production should rise in 2016 to its second highest daily output level since record production was set in 1970," he said in a statement tied to the release of a short-term market report.

Most of the increase in U.S. oil production is coming from shale basins in the Lower 48 states and some of that is developed as condensate, an ultra-light form of crude oil. Recently, some companies working in U.S. shale have started to export condensate, raising questions about U.S. policies on exports.

White House spokesman Josh Earnest said Tuesday there has been no change in export regulations.

"These kinds of regulations related to crude oil exports are administered by the Department of Commerce," he told reporters. "So if there's any sort of formal announcement about a change, it will come from the Department of Commerce."

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The Commerce Department's Bureau of Industry and Security said in a late 2014 policy overview condensate produced in a certain way is not crude oil, but a petroleum product subject to few export restrictions.

EIA in November said it was assessing the impact of a "possible relaxation of current limitations on U.S. crude oil exports, which is another avenue to accommodate domestic production growth."

Arab members of the Organization of Petroleum Exporting Countries in the early 1970s placed an embargo on oil exports in response to U.S. policies on Israel. In response, the U.S. Congress passed legislation that places restrictions on crude oil exports from domestic sources.

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