Washington, DC – International pressure is growing on Washington from several major trading partners to ease, or end, the long-standing ban on US crude oil exports.
Mexico said recently that it could enter an agreements with the US on crude oil swaps or on direct imports, while one of South Korea’s leading refiners has opened discussions with the government in Seoul over how to encourage Washington to end the ban on ‘ultra-light sweet crude,’ and the European Union wants US oil and natural gas exports covered by the proposed Transatlantic Trade and Investment Partnership.
According to Petroleos Mexicanos (PEMEX), Mexico’s state-owned oil company, the country is seeking US-sourced oil because of a sharp decline in its own reserves.
South Korea, which relies on imports to cover more than 95 percent of its energy needs, has had to curb oil imports from major supplier Iran, due to US and EU sanctions introduced in 2012, and the EU is eagerly looking for an alternative to petroleum supplies from Russia.
Japan, while not pushing for an ease on the current ban, has said it’s interested in importing more of what can be pumped out of gushers in such states as Texas, Alaska and North Dakota, but only “if the supplies are economically feasible.”
While fully overturning the ban would require Congressional action that most consider unlikely in the near-term, many argue that the White House could gradually allow for more oil to flow abroad through existing means.
Due in large part to the increase in shale oil production, the US is soon expected to surpass both Russia and Saudi Arabia as the world’s largest oil producer.
In March, the US Department of Commerce approved the export of 500,000 barrels of lightly processed condensate exports to South Korea from two domestic companies. Three additional applications have been put on hold as the White House reviews its policies on the ban.