Energy Secretary Ernest Moniz tells Senate panel export of petroleum products not classified as crude oil up considerably during the last decade. Photo by Kevin Dietsch/UPI |
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WASHINGTON, Oct. 7 (UPI) -- The export of petroleum products not classified as crude oil has increased by a factor of four in the last decade, the U.S. energy secretary said.
A Senate committee on energy heard testimony about the merits of the nation's strategic petroleum reserve. Jason Bordoff, director of energy policy at the Columbia University School of International and Public Affairs, explained the SPR is an important strategic asset despite the rise in domestic crude oil production and the subsequent decline in imports.
"There is an urgent need to modernize the SPR's existing infrastructure to ensure that it can remain effective in the event of an emergency by delivering additional and incremental barrels to the market," he said in his prepared remarks.
In July, Sen. Lisa Murkowski, the Republican chair of the committee, expressed frustrated with lack of funding necessary to modernize the SPR.
The SPR was created in the wake of the Arab oil embargo on the United States in the 1970s to provide an emergency stockpile to buffer against any future supply shocks. With U.S. crude oil production rivaling Saudi Arabia, industry supporters argue the subsequent ban on domestic crude oil exports established after the embargo is outdated.
U.S. Energy Secretary Moniz told the Senate committee U.S. producers were not throttled by the ban on access to foreign economies.
"U.S. exports of non-crude petroleum products from the United States averaged a record 3.8 million barrels per day in 2014, a nearly four-fold increase over the last decade," he testified.
The U.S. Bureau of Industry and Security, a division of the Commerce Department, has authorized exports of so-called condensate from the U.S. market. The White House said earlier this year the BIS decision did not represent a shift in U.S. export regulations.
Legislation enacted in response to the 1970s oil embargo bans the export of unprocessed crude oil, but products like gasoline and other fuel products aren't restricted.
Condensate refined or processed in a certain way is not characterized as crude oil and is therefore not subject to the export ban.
