Oil storage tanks are seen at sunrise with the Rocky
Mountains and the Denver downtown skyline in the
background October 14, 2014.
(Reuters) - The White House does not feel pressure to
loosen restrictions on U.S. oil exports further and
views debate over the issue as resolved for now, John
Podesta, a top aide to President Barack Obama, told
Reuters in an interview.
The drop in oil prices and the Commerce Department's
move to allow companies to ship as much as a million
barrels per day of ultra-light U.S. crude to the rest of
the world has taken pressure off the administration to
do more.
"At this stage, I think that what the Commerce
Department did in December sort of resolves the debate.
We felt comfortable with where they went," Podesta said
from his West Wing office in the most substantive
comments yet from a White House official on the
contentious issue of exporting abundant U.S. shale oil.
"If you look at what's going on in the market and
actions that the Department took, I think that ...
there's not a lot of pressure to do more."
His comments may disappoint some Republicans and
energy companies such as Hess Corp. which have lobbied
for more relief from a ban they view as a relic of the
1970s Arab oil embargo. While few analysts expected
Obama to make a serious effort to repeal the ban – a
delicate political topic due to widespread fears among
Americans that doing so could inflate gasoline prices –
some had hoped that further modest measures to ease its
impact might emerge this year.
By standing pat, however, Obama may avoid clashing
with his environmentalist supporters who have begun to
campaign against lifting the restrictions, hoping that
might keep a lid on domestic oil drilling by depressing
local prices. Some refiners such as PBF Energy, which
have benefited from the abundance of U.S. shale oil,
also oppose easing the ban.
Podesta, who plans to leave the administration in
early February and help former Secretary of State
Hillary Clinton if she decides to run for president, has
played a critical role on energy and climate policy
during his one-year tenure with Obama.
He said the White House would unveil additional
measures on climate change, including steps to reduce
methane emissions, before Obama's State of the Union
address on January 20. The speech will include a section
on fighting global warming, an increasingly important
part of Obama's second-term agenda.
His remarks on oil exports provide insight into the
administration's thinking on an issue that has unsettled
oil markets and international allies alike.
Obama had faced calls from counterparts in Europe and
elsewhere to reverse a 40-year-old ban on exports of
most domestic crude and allow some of the booming U.S.
shale oil production to be sold overseas.
Bowing to that, the Commerce Department said in
December it had granted permission to some companies to
sell lightly treated condensate, a form of ultra-light
crude, abroad.
But that move came in the midst of a collapse in oil
prices, which had started to reduce pressure on Obama to
loosen export restrictions. Prices have plunged to less
than $50 a barrel and U.S. drillers are more concerned
over generating cash flow and trimming spending plans
than seeking new markets abroad.
With the rapid rise in U.S. oil output now expected
to slow or even stop by the end of this year, fears that
domestic supply would quickly overtake local refiners’
demand have largely subsided, at least for the moment.
Podesta declined to comment on whether low oil prices
and changing market conditions affected the
administration's thinking on the size of the U.S.
Strategic Petroleum Reserve.
The Department of Energy, he said, was studying how
best to manage the reserve and evaluating its size and
structure. "They’re doing an analysis on that," he said.
Podesta said it was too early to tell whether lower
gasoline prices would set back some of the
administration's other climate measures. The retail
market could change as consumers take a second look at
less fuel efficient vehicles that were less appealing
when oil was more expensive.
(Additional reporting by
Timothy Gardner and
Roberta Rampton in Washington; Editing by
Caren Bohan and
Tomasz Janowski)
© Thomson Reuters 2014 All rights reserved
http://www.reuters.com/article/2015/01/07/us-usa-crude-exports-exclusive-idUSKBN0KG1ST20150107