Suddenly US oil exports are about to be a factor in geopolitics

From:  Quartz 

By Steve LeVine @stevelevine April 11, 2014

 

 April 11, 2014

 

There's an ocean traffic jam building. Reuters/Tim Chong

 

Oil prices have fallen again today thanks in part to a deal this week between Libya’s government and a separatist-minded militia that allowed a key oil terminal to reopen. But there is the potential for an even sloshier market—and lower prices—starting later this month with the largest US exports of crude and oil products in four decades.

Legally speaking, US oil exports have been banned—with small exceptions—since 1975 and the Arab oil embargoes. But, pushed by the surge of US oil production from the shale boom, those exceptions appear about to grow.

Last year, the US allowed the export of about 200,000 barrels a day to Canada—not a large volume. But now, Canada’s Enbridge has obtained US permission to re-export Canadian crude oil to Europe through the US (via the Gulf of Mexico). That flow seems likely to begin this month. And when you add up exports of US crude to Canada, Mexico and the Far East, the US could be shipping 800,000 barrels a day—mostly to Europe and Asia—by the end of the year, predicts Citi’s Ed Morse. MORE