Yes, I've read that several times on the 'net. The reality is that Japan actually has gotten Alaskan oil...more than 10 years ago. Germany? Shipping Alaskan oil to German refiners is akin to a man in New York hopping in the car to buy a loaf of bread, and driving to Iowa to get it.
The scoping session was one of several on the east coast and in Houston to take public comment on an environmental impact statement necessary to allow seismic work in the mid-Atlantic areas that the Obama administration recently backed for possible oil and gas exploration. Speakers included a few supporters of exploration of the area, but were mostly either organized groups like the Sierra Club or private citizens, all in opposition to the plan.
Here's the reality: the US did allow on a case-by-case basis the export of Alaskan crude in the 1990's. But after fighting for years to get the right to do it, BP found that the economics of sending crude to Japan or Taiwan was simply not working.
Each week, the US Energy Information Administration posts US exports of crude at right around 33,000 b/d. A spokesman for the EIA in an email told Platts that the export figures "are extrapolated based on historical monthly data published in our Petroleum Supply Monthly." Which can be interpreted as that the occasional odd Alaskan cargo that goes to Canada is assumed to still occur every so often, and spread out over the various reports. Which means, for all intents and purposes, that the US doesn't export crude.
Yet here were speakers noting that oil markets are
international and therefore any oil would be exported. To reach
this conclusion, a few things had to be ignored.
First, there are a whole range of thirsty refineries -- one even
in Virginia -- on the US East Coast that now import all their
crude. The Philadelphia refining sector, including the
soon-to-be-reopened Delaware City plant, all could be served by
pipeline or short-haul tankers from any oil discovered in the
Atlantic. Those freight economics would give the US consumer an
enormous advantage over any foreign buyer. Insurmountable,
actually.
And yes, it is an international market. And what that means is
that the price in Europe, or in Asia, is never going to be that
far out of whack with the price in the US. Arbitrage
opportunities pounced on by traders will ensure that will
happen. So how could a sale to a European refinery possibly be
competitive with a sale into the US, especially if it's to a
refinery only a few miles away served by a direct pipeline
connection?
And finally, of course, except for that Alaskan exception, US crude exports are banned. But even if they weren't, it wouldn't matter: the failed Alaskan export experiment of the 1990's showed that the economics simply don't work. It doesn't work even if you are able to use a lower-priced international-flagged vessel, rather than the expensive ships of the Jones Act. That's the law that requires any cargo moving between two US ports to be transported on a US-flagged vessel, which are far more expensive than a ship out of, say, Liberia or Panama.
The Deepwater Horizon rig disaster raises a lot of questions about whether offshore drilling should be expanded. One question that shouldn't be in the mix is the myth that won't die: the one about US crude exports.