Four refining companies have come together to oppose the growing push to scrap the crude oil export ban in the U.S. Fuel Fix reported on the newly found Consumers Refiners United for Domestic Energy (CRUDE), which so far consists of Alon USA Energy Inc, PBF Energy, Monroe Energy, and Philadelphia Energy Services. They came together in late January in response to the emergence of a campaign to remove the nearly 40-year old ban on oil exports. CRUDE will focus its outreach efforts on Capitol Hill and regulators at the Commerce Department.

The surge in oil production in the United States has provided refiners with a windfall. Domestic crude can at times trade for a discount relative to the global price of oil, lowering the input costs for refined products. Refiners can process that crude into higher-value petroleum products for export. They are concerned that allowing crude to be exported without restrictions will raise the price per barrel. “Why would they support lifting the ban if they didn’t think it was going to lift prices?” said Jeff Peck, a lobbyist hired by CRUDE. “That’s obviously good for them, but it’s not going to be good for the American consumer, who is going to pay more at the pump.”

Drillers, on the other hand, want to be able to sell their oil to more lucrative markets abroad. And by opening up the U.S., they argue, higher demand will support more drilling and thereby further lifting U.S. oil production.

The division marks a rare split in the oil and gas industry, whose players usually speak in concert. It remains to be seen what kind of effect the new CRUDE group can have. At this point export supporters have gained significant momentum in the first few months of 2014. They have found a powerful voice in Sen. Lisa Murkowski (R-AK) who has made oil exports a signature issue.

By James Burgess Oilprice.com