US studying prospects of exporting US crude: White House adviser

New York (Platts)--8May2014/526 pm EDT/2126 GMT

The Obama administration is studying whether the US should export some of its growing crude production, a top White House energy adviser said Thursday.

John Podesta, a special adviser to President Barack Obama, said the prospects of US crude exports are "a topic that's under consideration" and that the administration is conducting an inter-agency study of the issue. Podesta's comments came on the sidelines of an event at Columbia University's Center for Global Energy Policy in New York.

Earlier in the event, Podesta said during a panel discussion that the US is studying whether refineries can handle the boom in domestic oil production, as many producers have called on the US to lift its decades-old ban on most crude exports.

"We're taking an active look at what production looks like, particularly Eagle Ford, and whether the current refinery system can support the capacity increase [needed] to refine the product that's being produced through the boom," Podesta said. "We're taking a look at that and deciding whether there's potential for effective and economically utilizing that resource through a variety of different mechanisms."

The US largely bans exports of crude under restrictions imposed by Congress in the wake of the 1973 Arab oil embargo. The Department of Commerce can issue permits for crude exports under certain prescribed conditions, but has generally only allowed small quantities to Canada.

With US production surging thanks to the shale boom, many upstream operators and integrated majors have begun to push for an end to the ban, as much of the oil being produced is light, sweet crude that most refineries in the US are not optimized to use.

The US Energy Information Administration has forecast that domestic crude production will double from 2008 levels to 9.6 million b/d by 2019.

--Herman Wang, herman.wang@platts.com
--Edited by Derek Sands, derek.sands@platts.com

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