Cook: Crude oil exports would grow American economy
Since the dawn of the 20th century, the auto industry has called Michigan home and we’ve proudly developed, engineered, and produced some of the world’s very best vehicles on the road today. And for nearly just as long, the combination of American and global consumers have propelled that industry, driving quality union jobs and the innovation that puts American-made cars in high global demand.
According to federal data, Michigan’s automotive industry exported $29 billion in products to 169 countries in 2013 – expanding exports by 105 percent since 2009. Thanks to Michigan’s growing and robust exports, consumers across the globe are purchasing many of the same Chevys, Fords, and Jeeps available to American consumers here at home. And thanks to heightened open trade, there’s a greater demand for American-made cars, boosting the automotive supply chain and creating even more good-paying Michigan jobs.
Imagine, though, if our government banned Ford, GM, and Chrysler from exporting their vehicles across the world. Surely, Michigan’s economy would suffer, the automotive supply chain would shrink, and many of our friends and neighbors would be out of work.
That exact policy is the law for American crude oil. It’s an outdated, decades-old ban that Congress must repeal.
Today, thanks to responsible shale development, U.S. oil production is reaching record highs, recently passing both Saudi Arabia and Russia as the world’s leading petroleum producer.
As a result of this increased production, the volume of light crude oil currently being produced in the U.S. has surpassed our domestic refining capacity. In fact, the U.S. currently has more than 480 million barrels of oil in storage, an 80-year high according to the U.S. Energy Information Administration.
Thanks to increased domestic oil production, our nation has, in a very short amount of time, shifted from a position of energy weakness to strength, recapturing its role as a global energy leader. Yet these positive advancements are at-risk because of the decades-old ban that restricts America’s oil producers’ ability to directly and fairly trade with partners and allies around the world.
Just as Michigan’s annual multi-billion dollar exports put many of our friends and neighbors to work and strengthens our economy, exporting a portion of our abundant, domestically produced crude oil is projected to have similarly positive economic benefits.
According to a study by global research firm IHS, repealing the obsolete crude oil export ban will create up to 13,300 Michigan supply chain jobs that provide $1.2 billion in income for Michigan families. Additionally, according to IHS experts, modernizing our energy trade policies is projected to generate nearly $800 million in federal, state, and local government revenue and add $1.5 billion to Michigan’s gross state product.
Consumers would feel the benefits of such a policy change as well through lower prices at the pump. As confirmed by a number of independent analyses from think tanks, academia and even the federal government, by repealing the ban on crude oil exports there would be downward pressure put on the price of crude oil and refined petroleum products, including gasoline.
A recent study from ICF International found that U.S. consumers could save on average up to $5.8 billion per year between 2015 and 2035 if the ban was repealed and researchers at Columbia University found that consumers could save up to 12 cents per gallon at the pump.
Here in Michigan, trade is vital to our state’s job creators and to our working families. Everyday Michigan’s economy is strengthened and Michiganians proudly go to work producing made-in-America vehicles destined for showrooms overseas. It’s time for Congress to make a logical decision reflecting today’s abundant domestic energy supplies, not one of scarcity from decades past, and repeal the ban on crude oil exports.
Increasing U.S. exports is a bipartisan and sound policy that will create opportunity for American families and businesses and help our nation fully realize the benefits of our domestic energy revolution.
Jeffrey Cook is president of Southwestern Oil Company, an independent oil and gas producer in Greenville.