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Energy Tomorrow Blog

The Holistic Approach to Rail Safety

regulation  energy safety  infrastructure  crude oil 

Mark Green

Mark Green
Posted November 3, 2014

About a month ago, API President and CEO Jack Gerard stressed the importance of taking a comprehensive approach to develop new federal rules to govern the shipment of crude oil by rail – the soundest way to improve the North American rail network’s already strong 99.998 percent success rate:

“API supports a rule that ultimately improves the safety of rail transportation in North America through a holistic approach while allowing for the continued growth of the energy renaissance that has created and supported millions of jobs across the U.S. and Canada.”

The goal is realizing actual safety improvement. Industry is highly motivated in the quest for safety. Hess Corporation’s Lee Johnson, rail logistics advisor:

“My view has always been that I think the oil industry is maniacally focused on safety because of the consequences of failure in anything. … Everybody is very safety conscious, safety trained and well-equipped.”

With those stakes, developing the best safety rules possible is the objective. Industry believes improving safety is a multi-faceted endeavor – requiring enhanced prevention, mitigation and response measures – and it should be science-based.

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Good News, Thanks to U.S. Energy

oil and natural gas development  us crude oil production  hydraulic fracturing  horizontal drilling  shale energy  economic benefits  job creation  global markets 

Mark Green

Mark Green
Posted October 16, 2014

Early in a panel discussion of energy policy and politics hosted by Real Clear Politics, the question was asked whether U.S. voters pay much attention to energy issues in an election year. RCP tweeted panelist/Wall Street Journal energy reporter Amy Harder’s response - that voters only notice energy when the prices are high.

Certainly, that’s generally been an accurate analysis. Less than a decade ago energy issues were challenging for U.S. policymakers staring at flat or declining domestic oil and natural gas production

But the U.S. energy picture has been dramatically altered by surging production here at home – an energy revolution made possible by advanced hydraulic fracturing and horizontal drilling and vast resources in shale and other tight-rock formations. Result: Good news in the absence of challenging energy developments – for U.S. consumers (if not for hosts of events on the intersection of energy and politics).

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A Vote for American Energy = A Vote for Jobs, A Better U.S. Economy

Economy  jobs  american energy  crude oil  exports  colorado  texas 

Mary Leshper

Mary Schaper
Posted October 14, 2014

Huffington Post (Aspen Institute’s Thomas Duesterberg): The largely unanticipated boom in oil production in the last five years has revived a debate over whether the United States should reverse the forty-year old ban on exports of crude oil. Even though we still import around 30 percent of total crude and refined products, the U.S. refinery industry is unable to process much of the new supply of light crude oil produced from domestic light shale formations. In turn, domestic prices for light oil lag the world price and eventually could result in reduced levels of new production. Allowing exports would likely equalize domestic and world prices and also lead to more efficient global processing because many refineries abroad, especially in Europe, can do a better job than their U.S. counterparts. The United States would continue to import heavier grades of crude oil which its refineries are built to process.

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Crude Oil Exports and Consumers

crude oil  energy exports  economic benefits  gasoline prices  job creation  manufacturing  investments  refineries 

Mark Green

Mark Green
Posted October 14, 2014

A new study by the Aspen Institute joins a series of analyses concluding that one benefit from exporting U.S. crude oil would be lower gasoline prices here at home. Aspen’s projected reduction of between 3 and 9 cents per gallon parallels findings in previous major studies by ICF International (3.8 cents per gallon), IHS (8 cents) and Brookings/NERA (7 to 12 cents) that exports would lower pump prices.

Aspen and the other studies project other benefits from exporting crude oil, including broad job creation, economic growth and increased domestic energy production. Yet the solidifying consensus that consumers also would benefit is critically important as the public policy debate on oil exports continues.

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To the Future – Via American Oil and Natural Gas

crude oil  energy exports  keystone xl pipeline  crude oil prices  fracking  hydraulic fracturing  women in energy industry 

Mary Leshper

Mary Schaper
Posted October 8, 2014

New York Times: HOUSTON — The Singapore-flagged tanker BW Zambesi set sail with little fanfare from the port of Galveston, Tex., on July 30, loaded with crude oil destined for South Korea. But though it left inauspiciously, the ship’s launch was another critical turning point in what has been a half-decade of tectonic change for the American oil industry.

The 400,000 barrels the tanker carried represented the first unrestricted export of American oil to a country outside of North America in nearly four decades. The Obama administration insisted there was no change in energy trade policy, perhaps concerned about the reaction from environmentalists and liberal members of Congress with midterm elections coming. But many energy experts viewed the launch as the curtain raiser for the United States’ inevitable emergence as a major world oil exporter, an improbable return to a status that helped make the country a great power in the first half of the 20th century.

“The export shipment symbolizes a new era in U.S. energy and U.S. energy relations with the rest of the world,” said Daniel Yergin, the energy historian. “Economically, it means that money that was flowing out of the United States into sovereign wealth funds and treasuries around the world will now stay in the U.S. and be invested in the U.S., creating jobs. It doesn’t change everything, but it certainly provides a new dimension to U.S. influence in the world.”

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Exports: Harnessing America’s Energy Wealth

energy exports  crude oil  natural gas supplies  lng exports  economic benefits  production 

Mark Green

Mark Green
Posted October 6, 2014

We’ve posted a number of times on the merits of U.S. energy exports, because whether the subject is exporting crude oil or natural gas, there are compelling economic and energy reasons to lift restrictions on America’s ability to be a major player in global markets. While those restrictions remain, America and Americans lose.

A number of studies have said that energy exports will benefit our economy and stimulate more domestic production – here, here and here on liquefied natural gas (LNG) and here and here on crude oil. A new report from Columbia University’s Center for Global Energy Policy added that LNG exports could help strengthen the United States’ foreign policy hand.

Thanks to abundant oil and natural gas reserves, advanced hydraulic fracturing and horizontal drilling and investments by a robust industry sector, the U.S. is the world’s No. 1 producer of natural gas and is about to become No. 1 in oil output (subscription required). Yet, because of self-imposed and outdated (in the case of the crude oil) export restrictions, the U.S. isn’t harnessing its energy potential as it could and should.

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U.S. Crude Production to the Rescue

us crude oil production  supply  global markets  pump prices  shale energy  fracking  hydraulic fracturing 

Mark Green

Mark Green
Posted September 25, 2014

Supply matters. According to U.S. Energy Information Administration (EIA) chief Adam Sieminski, crude oil could cost at least $150 a barrel today because of supply disruptions in the Middle East and North Africa – if not for rising U.S. crude production.

Sieminski told the North Dakota Petroleum Council’s annual meeting that crude from the Bakken, Permian and Eagle Ford shale plays and others around the country has spiked in the past decade to more than 4 million barrels per day – enough to make up for outages in crude production elsewhere. Sieminski:

“If we did not have the growth in North Dakota, in the Eagle Ford and the Permian, oil could be $150 (per barrel). There is a long list of countries with petroleum outages that add up to about 3 million barrels per day.”

So, let’s rephrase things a bit: Clearly, U.S. production, adding to global supply, matters. A lot.

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Good News on Oil Exports and Gas Prices

crude oil  energy exports  gasoline price factors  domestic oil production 

Mark Green

Mark Green
Posted September 19, 2014

A couple of recent polls indicate many Americans are concerned that lifting the 1970s ban on crude oil exports could increase prices at the pump. A couple of thoughts.

First, it’s likely these opinions stem from an idea that restricting domestic crude oil output to the boundaries of the United States will favorably impact domestic pump prices. Yet, because crude oil is traded globally, the world market sets the cost of crude, which then is the chief factor in prices at the pump.

Second, the strong weight of new scholarship and analysis say that allowing exports of domestic crude will lower pump prices in this country – while also boosting economic growth, employment and wages and improving our balance of trade.

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Merits of Oil Exports are Clear

crude oil  exports  trade  oil production  economic benefits 

Mark Green

Mark Green
Posted September 10, 2014

A new report from Brookings’ Energy Security Initiative adds more scholarly weight to the analytical case for lifting America’s decades-old ban on crude oil exports. Echoing earlier studies by IHS and ICF International, the Brookings research finds that allowing the export of domestic crude would stimulate more oil production here at home, provide broad economic benefits and strengthen U.S. energy security. Brookings:

… we believe that the U.S. should allow the market to determine where crude oil will go and move immediately to lift the ban on all crude oil exports. … After 40 years of perceived oil scarcity, the United States is in a position to help maximize its own energy and economic security by applying the same principles to free trade in energy that it applies to other goods. By lifting the ban on crude oil exports, the United States also will help mitigate oil price volatility while alleviating the negative impacts of future global oil supply disruptions.

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Realizing Our Energy Opportunity

crude oil  exports  economic growth  oil production 

Mark Green

Mark Green
Posted September 4, 2014

New Jersey Gov. Chris Christie is making headlines this week with a speech from Mexico calling for stronger economic ties between the two countries and actions to sustain what he called the “North American energy renaissance” – including lifting the decades-old ban on exporting U.S. crude oil. Christie:

“For all of North America, the energy revolution has improved our strategic and competitive position. But the revolution remains in its infancy. And whether North America realizes the full potential of its energy opportunity will be the result of more than just luck and natural bounty, it will also be driven by the policy choices and investments we must make. … The 1970s-era ban on crude exports creates a price anomaly which holds U.S. crude oil at a discounted price, which ultimately hurts upstream production and limits the energy boom.”

Christie’s remarks parallel what others are saying about ending the domestic crude oil export ban.

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