Oil Industry Slams Bindens Export Ban Idea To Lower Prices

[Economy 52,845]

https://www.google.ca/amp/s/oilprice.com/Energy/Crude-Oil/Energy-Industry-Strikes-Back-At-Democrats-Oil-Export-Ban-Proposal.amp.html

 

Industry is slamming Bindens proposal of banning exports again (as was the the case from the 1970s until 2015) on grounds that it will only hurt US companies while doing nothing for consumers and refineries will be the ones to pocket all the money

 

The argument goes that because Gasoline and other refined goods have their own prices set by international markets, US drillers selling oil to refineries at a discount because of excess supply that cant be exported doesnt result in cheaper prices for consumers, refineries will still sell the final product at the same price regardless

 

Meanwhile Biden is under pressure to lower surging energy prices which is coinciding in a time of high inflation

[Chlorine 47,976]

I… don’t trust this source. 

Edit: I’m reading more. If I have any other thoughts I’ll update lol. 

[Economy 52,845]

3 hours ago, Frank Potion said:

I… don’t trust this source. 

Edit: I’m reading more. If I have any other thoughts I’ll update lol. 

I believe it tho cuz ive followed the markets for like 14 years and i remember when export ban was lifted and i know how crack spreads and benchmarks work between the raw product vs refined products work

 

Distilled/refined products have a global market just like the oil market and prices fluctuate independant of eachother all the time

 

For the longest time US WTI and other bench marks for US oil sold a lot cheaper than Brent and other international grades for the simple fact that since exports of oil were banned and US production was rising... producers were forced to take whatever US refiners offered them because they werent allowed to sell them anywhere else so North American oil benchmarks were depressed

 

But did that translate into cheaper gas prices for consumers, or jet fuel, diesel etc? Absolutely not. Refineries still sold it for the max price supply and demand allowed so gasoline for example still traded at international prices even tho oil itself was cheaper in North America

 

So consumers didnt benefit anything from the export ban once we had enough supply in North America. Oil producers did have to sell the oil cheaper due to the export ban but the ones who pocketed all the savings was the refiners not the consumers

 

So whose side do u take? I guess that depends whether ur more sympathetic to the drillers or the refiners (some companies are both). It makes no difference to the actual consumer