Oil industry may invoke trade law to challenge export restrictions

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There goes our future cheap fuel prices to Foreign Markets


By Jim Snyder & Mark Drajem, Bloomberg News

The U.S. oil industry, riding a domestic energy boom, is preparing to challenge restrictions on crude exports, possibly by arguing that limits designed to keep petroleum in America may violate international trade rules.

“Export issues are something we’re going to have to address,” John Felmy, the chief economist for the American Petroleum Institute trade group, said in an interview. “It’s a debate we have to have.”

He declined to discuss lobbying strategy or trade rules, though a June planning document on API letterhead obtained by Bloomberg News says the group has begun to develop “the necessary legal analysis” to support export approvals.

API is planning to “highlight potential violations of the World Trade Organization rules against export restrictions,” according to the draft document, prepared for the group’s executive committee meeting.

Industry officials say the push is just starting to lift the 1970s-era restrictions, and they acknowledge it will be an uphill fight that raises sensitive political issues. The U.S. is producing more oil than it has in nearly a quarter-century, though, reducing its reliance on imports and putting the nation closer to energy independence than it has been since 1989, according to the Energy Information Administration.

Reid Porter, a spokesman for the Washington-based group, said he wouldn’t comment on specific strategies, though he confirmed the group supports lifting export restrictions.

“Supporting the free market and supporting open trade is a key priority for our industry,” Porter said. “It creates efficiencies, creates jobs, and increases revenue to our government.”
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