Publications: Notes at the Margin

Exports of US Crude Oil: The Economic Stimulus the World Requires? (January 13, 2014)


A US decision to permit crude exports would almost certainly change the world oil market’s dynamics as it would sharply increase the global supply of low-sulfur crudes. Specifically, a boost in light, low-sulfur crude production would have implications for the global oil supply mix. The removal of US export controls would theoretically make up to five million barrels per day of light, low-sulfur crude available to the world market. Roughly speaking, the incremental production would raise the available supply of such crudes to world refiners fifteen to twenty percent. It would be surprising if the increased availability did not exert significant downward pressure on prices of other light sweet crude oils such as Brent. This week's report provides the details on this situation.


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