API Supports Free Trade
Global trade and investment regimes are of critical importance. Free trade provides opportunities for business growth and expansion; increases the range of oil, natural gas, and other petroleum products available to consumers; enhances market‐based production globally; and contributes to global energy cooperation. API believes these ends can only be achieved by eliminating impediments imposed on international oil and natural gas producers, fostering a pro‐export environment, and maintaining a level playing field among industry sectors by reducing trade barriers that distort the market and raise costs to consumers.
API: Oil and natural gas boost 2015 trade balance>
A mid-year trade report from the U.S. Commerce Department shows that the oil and natural gas industry continues to drive U.S. economic gains in 2015, a trend that could accelerate under free trade policies, said API Chief Economist John Felmy. The total U.S. trade deficit peaked at $762 billion in 2006, prior to the surge in U.S. oil and natural gas production. By 2014, it had dropped to $508 billion. An August 5th report, covering trade data through June 2015, shows that the U.S. trade deficit among petroleum and petroleum products fell by 56.1 percent compared to the first six months of 2014 (exhibit 9). That growth helped to hold the total U.S. year-over-year trade balance steady, despite a 23.1 percent increase in the trade deficit among non-petroleum products. Noted Felmy, “Despite a very competitive global market, the U.S. energy revolution continues to push our trade balance in a positive direction.”]
API Ranking Shows States Compete Among Top Energy Producing Nations
Many individual U.S. states now rival the world’s major energy producing countries, according to a ranking published by API. Each with a natural gas output above 3 billion cubic feet per day, eight U.S. states would rank among the world’s top 30 gas producing countries, exceeding nations like Venezuela and Oman in 2012, the most recent year for which consistent international data is available. The rapid growth in shale production, unlocked by hydraulic fracturing and horizontal drilling, has helped the United States to take the top spot among global producers. Among oil producing nations, two U.S. states – Texas and North Dakota -- would rank among the top 20 nations in the world. Four additional states make the top 35.
API Policy Positions on the Transatlantic Trade and Investment Partnership (TTIP)
Energy is an important component of transatlantic trade. API believes energy‐related World Trade Organization (WTO) and market access principles should be fully addressed in the Transatlantic Trade and Investment Partnership (TTIP). API advocates for a TTIP that removes barriers, promotes market‐oriented policies and creates genuine opportunities for commercial growth and job creation.
The below papers represent the policy positions on TTIP of the 700+ member companies of API and the International Association of Oil & Gas Producers (IOGP).
API Supports Strong Investor State Dispute Settlement (ISDS)
API members support a strong Investor State Dispute Settlement (ISDS) mechanism, as part of free trade agreements (FTAs) and bilateral investment treaties (BITs), to strengthen the enforceability of commitments in the agreements and the principles of contract sanctity, anti-corruption and protection from arbitrary asset confiscation. For oil and natural gas companies, ISDS is especially important because it provides the right to companies, as investors, to go to international arbitration (1) to pursue compensation for expropriation and (2) for claims related to investment agreements when there is a denial of fair and equitable treatment in local courts.
API Supports Duty Drawback
API advocates that trade agreements continue to include duty drawback provisions for U.S. manufacturers to obtain a refund (or “drawback”) of duties, taxes and fees that were paid on imported goods used in that manufacturing effort. The drawback of Federal duties, taxes and fees helps U.S. manufacturers, retailers and distributors compete in the global marketplace by reducing the distribution and production costs of U.S. exports.