On June 4, 2015 Senator Lisa Murkowski asked for and was granted permission to address the United States Senate concerning a matter of urgent national security concern to this nation. Senator Murkowski is the chairwoman of the powerful Senate Committee on Energy and Natural Resources:
“Mr. President, when we talk about national security issues and the vulnerabilities we have as a nation, I can think of no other area where we face such challenges and yet such opportunities when it comes to our energy assets and how we can utilize our energy policies at their intersection points with our national security policies.
The inability of the United States to export oil is a vulnerability to our nation. At a time when we have risen to be the world’s top producer of oil, our outdated 1970s-era ban on oil exports is causing us to miss out on a significant economic- and security-related benefits.
The good news is we can change this. It is within our power to change this, and that is why I have come to the floor this afternoon.
Here is a fact: The United States is the only advanced Nation that prohibits crude oil exports. We are the only one. Countries such as Australia, Denmark, Norway, the United Kingdom, Canada, and even New Zealand all allow for both imports and exports, just like the normal trade in any other commodity. It is distinctly weird that we would prohibit our own exports.
We are also in a position where our friends and our trading partners are openly asking us for assistance. They are coming to us and saying: Hey, can you help? We are your friends. We are your allies. You have the resources.
The world has changed dramatically. We have new alliances. We have new threats. We have new hopes. We have new fears. It is my own hope that while the world may have changed, our Nation’s role as a global leader has not eroded. This is an area where we have an opportunity to prove it has not eroded.
Our energy renaissance is a new thing, and sometimes it takes time to understand the implications of new things, of changes, but here is where we have been. We have already held about half a dozen hearings on the topic of oil exports in the House and in the Senate since last January. I introduced this subject last January 2014, and I said at that time that 2014 was going to be the year of the report, where we would seek out the experts, we would ask the think tanks to weigh in on this issue, and so they did. The reports that came out were numerous, they were considered, they were thoughtful, and they were all very helpful. Reports came out of the Brookings Institution, Columbia University, the Center for a New American Security–too many to even list here. The individual experts who are in favor of allowing oil exports are also quite impressive. These are people whom we look to for leadership in a host of different areas.
There was a piece in the Wall Street Journal that I ask unanimous consent be printed in the Record, penned by Leon Panetta and Stephen Hadley, the Defense Secretary in the Obama administration and the National Security Advisor in the Bush administration. They wrote a piece that was entitled “The Oil-Export Ban Harms National Security.” It is well-founded, well-written, and to the point.
There being no objection, the material was ordered to be printed in the RECORD, as follows:
[From the Wall Street Journal (Opinion) May 19, 2015] The Oil-Export Ban Harms National Security
THE U.S. IS WILLFULLY DENYING ITSELF A TOOL THAT COULD PROVE VITAL IN DEALING WITH THREATS FROM RUSSIA, IRAN AND OTHERS
(By Leon E. Panetta and Stephen J. Hadley) The United States faces a startling array of global security threats, demanding national resolve and the resolve of our closest allies in Europe and Asia. Iran’s moves to become a regional hegemon, Russia’s aggression in Ukraine, and conflicts driven by Islamic terrorism throughout the Middle East and North Africa are a few of the challenges calling for steadfast commitment to American democratic principles and military readiness. The pathway to achieving U.S. goals also can be economic–as simple as ensuring that allies and friends have access to secure supplies of energy.
Blocking access to these supplies is the ban on exporting U.S. crude oil that was enacted, along with domestic price controls, after the 1973 Arab oil embargo. The price controls ended in 1981 but the export ban lives on, though America is awash in oil.
The U.S. has broken free of its dependence on energy from unstable sources. Only 27% of the petroleum consumed here last year was imported, the lowest level in 30 years. Nearly half of those imports came from Canada and Mexico. But our friends and allies, particularly in Europe, do not enjoy the same degree of independence. The moment has come for the U.S. to deploy its oil and gas in support of its security interests around the world.
Consider Iran. Multilateral sanctions, including a cap on its oil exports, brought Tehran to the negotiating table. Those sanctions would have proved hollow without the surge in domestic U.S. crude oil production that displaced imports. Much of that foreign oil in turn found a home in European countries, which then reduced their imports of Iranian oil to zero.
The prospect of a nuclear agreement with Iran does not permit the U.S. to stand still. Once world economic growth increases the demand for oil, Iran is poised to ramp up its exports rapidly to nations whose reduced Iranian imports were critical to the sanctions’ success, including Japan, South Korea, Taiwan, Turkey, India and China. U.S. exports would help those countries diversify their sources and avoid returning to their former level of dependence on Iran.
More critically, if negotiations fail, or if Tehran fails to comply with its commitments, the sanctions should snap back into place, with an even tighter embargo on Iranian oil exports. It will be much harder to insist that other countries limit Iranian imports if the U.S. refuses to sell them its oil.
There are other threats arising from global oil suppliers that the U.S. cannot afford to ignore. Libya is racked by civil war and attacks by the Islamic State. Venezuela’s mismanaged economy is near collapse.
Most ominous is Russia’s energy stranglehold on Europe. Fourteen NATO countries buy 15% or more of their oil from Russia, with several countries in Eastern and Central Europe exceeding 50%. Russia is the sole or predominant source of natural gas for several European countries including Finland, Slovakia, Bulgaria and the Baltic states. Europe as a whole relies on Russia for more than a quarter of its natural gas.
This situation leaves Europe vulnerable to Kremlin coercion. In January 2009, Russia cut off natural gas to Ukraine, and several European countries completely lost their gas supply. A recent EU “stress test” showed that a prolonged Russian supply disruption would result in several countries losing 60% of their gas supplies.
Further, revenue from sales to Europe provides Russia with considerable financial resources to fund its aggression in Ukraine. That conflict could conceivably spread through Central Europe toward the Baltic states. So far, the trans-Atlantic alliance has held firm, but the trajectory of this conflict is unpredictable. The U.S. can provide friends and allies with a stable alternative to threats of supply disruption. This is a strategic imperative as well as a matter of economic self-interest.
The domestic shale energy boom has supported an estimated 2.1 million U.S. jobs, according to a 2013 IHS study, but the recent downturn in oil prices has led to massive cuts in capital spending for exploration and production. Layoffs in the oil patch have spread outward, notably to the steel industry. Lifting the export ban would put some of these workers back on the job and boost the U.S. economy.
Why, then, does the ban endure? Habit and myth have something to do with it. U.S. energy policy remains rooted in the scarcity mentality that took hold in the 1970s. Even now, public perception has yet to catch up to the reality that America has surpassed both Russia and Saudi Arabia as the world’s largest producer of liquid petroleum (exceeding 11 million barrels a day). The U.S. became the largest natural gas producer in 2010, and the federal government will now license exports of liquefied natural gas.
The fear that exporting U.S. oil would cause domestic gasoline prices to rise is misplaced. The U.S. already exports refined petroleum, including 875,000 barrels a day of gasoline in December 2014. The result is that U.S. gasoline prices approximate the world price. Several recent studies, including by the Brookings Institution, Resources for the Future and Rice University’s Center for Energy Studies, demonstrate that crude oil exports would actually put downward pressure on U.S. gasoline prices, as more oil supply hits the global market and lowers global prices.
Too often foreign-policy debates in America focus on issues such as how much military power should be deployed to the Middle East, whether the U.S. should provide arms to the Ukrainians, or what tougher economic sanctions should be imposed on Iran. Ignored is a powerful, nonlethal tool: America’s abundance of oil and natural gas. The U.S. remains the great arsenal of democracy. It should also be the great arsenal of energy.
Ms. MURKOWSKI. It said directly: We keep this ban in place, this decades- old ban. It hurts us as a nation. It harms us from a national security perspective, not to mention the benefits that oil exports will provide when it comes to increased production and increased jobs benefits to our economy.
There are other folks out there who have also weighed in. Larry Summers, formerly the Treasury Secretary for President Clinton and also Director of the National Economic Council for President Obama, said this about lifting the ban on oil exports: “The merits are as clear as the merits with respect to any significant public policy issue that I have ever encountered.” This is a guy many people looked to for leadership in a host of different areas. The merits are as clear as the merits with respect to any significant public policy issue he has encountered.
Tom Donilon, formerly the National Security Advisor to President Obama, has said that allowing exports “will increase diversity of supply, increase competition, reduce volatility and lower prices in global markets.”
The questions we needed to ask about oil exports have been asked, and answered favorably. Independent experts have studied what would happen if we lift the ban and almost universally encouraged us to move forward to lift this outdated, outmoded policy.
This is not a partisan issue. My colleague from North Dakota is on the floor today. We have introduced bipartisan legislation to remove this ban. This is something which is simply in the best interest of the United States, both in terms of our economic strength and in terms of our national security.
I am here today to tell our colleagues, to repeat and remind our colleagues that the time to legislate on oil exports is now. I think the bill we have in front of us, the National Defense Authorization Act being led by our friend and colleague from Arizona, is the perfect vehicle on which to advance this. Therefore, I ask unanimous consent to call up and make pending my amendment No. 1594, related to crude oil exports.
Mr. President, I withhold the request to make this amendment pending at this point in time, but if I may proceed to speak to three quick components to the amendment.
The first requires the Department of Energy to assess the impact that lifting sanctions on Iran would have on global oil markets. We would likely see higher Iranian oil exports, even as American producers are prohibited from accessing global markets. So our friends in Japan, India, South Korea, and elsewhere would continue importing from Iran, in part because they cannot get the crude oil from us. They cannot import from us. That situation is simply unacceptable. We would be lifting sanctions on Iranian oil while maintaining them on American oil.
I have made this point and I have repeated it before: Leaving in place the oil export ban on U.S. producers while at the same time sanctions are relieved on Iranian producers effectively sanctions U.S. oil production.
There was an article in Reuters this week that revealed that India is now importing record volumes of oil directly from Iran. Another from May showed record oil exports out of Iraq to global markets. Yet another shows the highest volumes of oil exports from Saudi Arabia in 10 years. So the fact is that we are simply not competing.
The second component of my amendment says that 30 days after completion of this report, all U.S. crude oil may be exported on the same basis as the regulations and law currently allow for exports of petroleum products. Today, we can export gasoline, we can export diesel, we can export jet fuel–really, any refined product we can export without a license–but we cannot export crude oil. It does not make sense, and it is high time we resolve that inconsistency.
The third component of my amendment preserves the authorities of the President to block exports during emergencies, during a national security crisis, and so forth.
So what we have done is we have borrowed language on these authorities directly from the legislation from 20 years ago that authorized oil exports from Alaska’s North Slope, which was a measure that passed the Senate on a bipartisan vote, 74 to 25, and was signed into law by President Clinton. What we had over 20 years ago was an overwhelmingly favorable vote well before this American energy renaissance began.
I find the whole idea that oil exports would still be prohibited a little mind-boggling. The Commerce Department keeps a list of commodities that are in short supply. They call this the short supply controls. Historically, these controls were generally not blanket prohibitions; they were on items such as aluminum, copper, iron and steel scrap, diamond bort and powder, nickel selenium, and the polio vaccine–not blanket prohibitions, just bits of them. Only three items remain on the short supply controls list. One of them–you guessed it–is crude oil, the second is western red cedar, and the third is horse for slaughter. There is also a small caveat here that prohibits exports from the Naval Petroleum Reserves, but, really, the list is pretty short. There are three things: crude oil, western cedar trees, and horse for slaughter. Clearly our policy needs to be modernized.
We see many parts of the world in a state of unrest. Many parts of the world are seemingly on fire. America and American energy need to be ready to render vital assistance to our friends who are counting on us to demonstrate that global leadership. This is our chance, and I look forward to further discussion on the floor as we move this NDAA measure forward.
I encourage colleagues to look at this amendment, look at the merits of the reports that have gone down in the past year, and look to updating this very outdated policy that is holding us back as a nation.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Kansas.
Mr. ROBERTS. Mr. President, I thank the Senator from Alaska for her remarks. Please count me in. It is very timely and extremely important.”
Source: Congressional Record
See video: Reducing U.S. oil dependence https://www.youtube.com/watch?v=Qbw-mfCeBnc
See related video: How U.S. oil affects national security https://www.youtube.com/watch?v=BiQXiCGLpVY
See video: National Security Consequences of U.S. Oil Dependency https://www.youtube.com/watch?v=6CPTyOWqu5k