Lobbying over whether to scrap the four-decade-old U.S. ban on exporting crude oil has almost doubled as proponents push to build momentum toward a showdown likely to come sometime after the 2016 election.
The number of companies and groups trying to influence the outcome of legislation in Washington rose to 55 in the second quarter from 30 in the same period last year, according to disclosures filed with Congress this week. BP Plc and PBF Energy Inc. are on opposite sides of the debate dividing producers and refiners.
At issue is whether the U.S. still needs export restrictions passed in 1975 on the heels of the Arab oil embargo that caused fuel shortages and long lines of cars at retail pumps. Horizontal drilling and hydraulic fracturing have pushed U.S. output to the highest level in 44 years.
“Whenever two groups are having at it, that’s very good for the lobbying business,” Viveca Novak, editorial director at the nonpartisan Center for Responsive Politics in Washington, said July 22 by phone. Lobbying will rise further as the debate probably will extend over years, she said.
Members of the House and Senate left the export ban out of bipartisan legislation most likely to move ahead in this session of Congress. While Representative Joe Barton, a Texas Republican, has introduced a House crude measure that has more than 100 co-sponsors, a similar Senate bill has just four co-sponsors.
Producers are pushing to lift the ban to take advantage of higher international prices, while some refiners argue that the country’s growing energy self-sufficiency means lower costs for consumer. West Texas Intermediate crude, the U.S. benchmark, has sold at an average discount of $5.46 a barrel to Brent, the global marker, over the past year.
New groups have formed around the issue. Producers for American Crude Oil Exports includes ConocoPhillips and Hess Corp. and has paid lobbyists $110,000 so far this year.
On the other side is Consumers and Refiners United for Domestic Energy, which spent $180,000 on lobbying through the first half of this year to retain the ban. It includes PBF and Delta Air Lines Inc. unit Monroe Energy LLC.
Exact amounts being spent on the export ban aren’t available because registrants disclose total expenditures on all issues in a single form.
ConocoPhillips has the most extensive effort on the ban, according to the filings. It’s hired three firms to represent it, in addition to five lobbyists on its own staff.
Other big oil producers, including Exxon Mobil Corp., Chevron Corp. and Marathon Oil Corp., support ending the export limits. All three have their own lobbying teams as well as outside firms to help on the issue.
While there is some congressional support for lifting the restrictions, there probably isn’t enough backing to end them before the 2016 elections, said Michael McKenna, president of MWR Strategies lobbying group in Midlothian, Virginia.
For more, read this QuickTake: Crude Clash