Energy industry insiders have slammed a proposal by a group of Democratic Senators to ban U.S. oil exports in a bid to rein in retail fuel prices.
"That proposal does absolutely nothing to alleviate higher prices or to make prices lower than in any sort of relative sense," petroleum economist Karr Ingham from the Texas Alliance of Energy Producers and creator of the Texas Petroleum Index told Fox News.
"The economics of that are pretty clear. And if the suggestion on the part of the administration is that in implementing a ban on U.S. crude oil exports makes US domestic crude oil prices lower and therefore, for example, U.S. gasoline prices lower, that's pure folly, that is not the effect," Ingham added.
A group of Senators led by Elizabeth Warren, Sherrod Brown, and Jack Reed wrote a letter to President Biden urging him to "consider all tools available at your disposal to lower US gasoline prices. This includes a release from the Strategic Petroleum Reserve and a ban on crude oil exports."
The senators also blamed OPEC+ for the state of U.S. retail fuel prices, which have reached the highest on record in California.
"As the United States work[s] to boost the development of clean and renewable energy over the long-term, we must ensure that Americans are able to afford to fill up their cars at the pump in the meantime," the Democratic senators wrote in the letter.
"Implementing a crude oil export ban does absolutely nothing," TAEP's Ingham said. "And it probably makes prices higher, not lower."
"The key to this is allowing U.S. oil and gas producers to do what they do best to simply get out of their way. Let them go to work," Ingham told Fox News. "Remove as much uncertainty as can be removed from the legislative, regulatory, and economic environment and let them get back to the business of growing U.S. domestic crude oil production energy production as rapidly as they can."
By Irina Slav for Oilprice.com
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Can you give a more detailed explanation of how that would work? Is the reasoning because production would go down?