President Barack Obama signed into law a $1.1 trillion government funding bill Friday afternoon, dodging a government shutdown and ending a 40-year-old crude oil export ban. U.S producers will now be able to sell crude to the international market.
Republicans made lifting the export ban a top priority. They argued the ban was a relic of the Arab oil embargo era.
House Speaker Paul Ryan, R-Wis., said the removal of the export ban was the most important change in U.S. oil policy in more than a generation.
“This is a big win for America’s energy workers, manufacturers, consumers and our allies,” Ryan said.
Oil companies have long urged Congress to lift the export ban as the industry deals with rising oil reserves and falling prices.
Lifting the oil export ban is very important to our industry to enable them to compete on a global basis,” said Sen. John Hoeven, R-N.D. “If we always get a lower price than the rest of the world that obviously gives the advantage to OPEC and Russia.”
Joshua Adler, founding chief executive of Sourcewater, a water exchange for the energy ecosystem, wrote about the export ban in a letter to the editor published in the New York Times on Monday.
Adler said exported American oil would replace production from countries with weaker health, safety and environmental standards.
“For as long as the world uses hydrocarbons, it is plainly in the United States’ economic, geopolitical and environmental interest to produce that energy here, with American workers and oversight, rather than subsidize hostile, less responsible regimes,” Adler wrote.
Republicans weren’t the only party with reasons to celebrate.
Democrats are pleased the bill promotes renewable energy. The spending bill includes five-year extensions of tax credits for wind and solar energy producers.
In fact, many oil and gas companies are calling for more action on climate change. Bob Dudley, chief executive of BP, explained why putting a price on carbon can lead to a lower-carbon future.
According to Dudley, a well-designed carbon price would encourage improvements in energy efficiency and lead to shifts in the fuel mix.
“In terms of the fuel mix, a carbon price makes all of the lower carbon alternatives more competitive – and in each particular situation, the most economical options will emerge.
The spending bill also renews the Land and Water Conservation Fund, a 50-year-old conservation program funded by oil and gas royalties.
The LWCF was renewed for three years, though many legislators pushed for permanent renewal.
Rep. Ryan Zinke, R-Mont., said in a statement that he was “glad Congress came to their sense and included some form of an LWCF reauthorization.”