The 40-year-old ban on exporting US crude oil moved a step closer to being repealed on Friday as the House passed the massive spending bill, despite concerns by some Democrats that lifting the restriction could cost jobs at independent refineries.
The $1.1 trillion government spending bill, which included the measure to lift the trade restriction in return for five-year extensions of tax breaks for wind and solar power, passed in a 316-113 vote. It now moves to the Senate, where it is expected to pass. Representative Nancy Pelosi and some of her fellow Democrats had concerns that opening US oil to exports would hurt independent refiners by raising the price of domestic crude to international prices. Brent crude traded in London on Friday traded at about $37.50 per barrel, only about $2 a barrel higher than WTI prices traded in New York, but the spread has been as high as $20 a barrel.
But Democrats in the Senate had secured some protections for independent refiners, allowing them to deduct transportation costs for gasoline and other fuels they make. Pelosi on Friday said Democrats walked away with a victory, in the trade of oil exports for environmental goals.
She said the environmental damage of exporting oil would be offset by 10 times because of measures in the bill such as renewable power tax credits, funding of a parks conservation fund paid for with oil revenues and the elimination of measures that would have dismantled President Barack Obama's clean power rules on power plants. Due to a global glut in oil supplies, lifting the ban is not expected to lead to significant shipments for months or even years but it could give crude producers the increased flexibility they coveted. Drillers had said that lifting the ban would increase US oil security and give Washington's allies in Europe and Asia an alternative source of crude beyond Opec and Russia.
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