What will be the implications?
40 years ago the U.S.A put a ban on the export of oil, because the country itself had a dearth of crude oil and therefore could not suffice it’s needed if they were to export it. But the scenario has changed a lot; the country might just be on the verge of lifting that ban, because it has excess crude oil, which they can export to other countries. This change has definitely helped President Obama attain enough credibility for allowing the United States of America to have surplus oil. This way the country is in an advantageous position and the export of oil will give a further boost to the economy. It also sheds light on the effective policy of the U.S.A which has successfully led the country to have more than enough oil within a span of 40 years.
The bill is yet to be passed
Though it is quite early to say that the U.S.A will most definitely lift the ban, because the motion is yet to become official, the democrats and republicans will meet in the parliament to pass the bill and only then will it be decided, that whether the ban is going to be lifted or not.
How does it affect the common people?
Production and exploration of oil were at a halt, after the 60 per cent reduction in oil prices. Such companies were saddled with huge amounts of debt and were facing bankruptcy, but such a change will be welcome by them. This way the companies will be able to export oil and will be in an advantageous position. Such a change will help them fight back with the financial deficit going around their company and they will breathe a sigh of relief.
The opinions of the gurus
Most economists are of the opinion that exporting is not the answer. With the price of petrol being the lowest in 7 years, such a method might not materialize as expected and things might not work out for those involved in the oil trade. It is to be understood that even if the oil is exported, people across the globe will expect it to be at a lower price, since everyone is aware of the slump in oil prices. In such a case scenario the cost of exporting along with the profit shares will make the prices of petrol higher which will totally defeat the purpose. Read more about How the Dollar has Improved and has Begun to Dominate right here.
The political opinion
The opinion of a number of democrats is a number of oil refining jobs will be at a huge risk if the ban is lifted. Plus, increased drilling to match the export demands will lead to environmental damages. Lifting the ban will help a number of Oil Companies in the U.S.A to compete in the world market which was something unknown to them. It will be interesting to see whether the lifting of the ban will help the U.S.A economy or not. However, it is time that the United States lifts the ban and checks the different possibilities when it comes to exporting crude oil.