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Ending Ban on Export of U.S. Crude Oil Would Benefit Manufacturing, Study Claims

The manufacturing sector, already a leading component of the U.S. economy, would benefit significantly if the crude oil ban were lifted, according to a new study.

Ending Ban on Export of U.S. Crude Oil Would Benefit Manufacturing, Study Claims

This was the finding of “Lifting the Crude Oil Export Ban: The Impact on U.S. Manufacturing,” a report sponsored jointly by The Aspen Institute’s program on Manufacturing and Society in the 21st Century and the MAPI Foundation, the research affiliate of the Manufacturers Alliance for Productivity and Innovation. Econometric modeling was conducted by Inforum, the Interindustry Forecasting Project at the University of Maryland.

“One of the most important drivers of a robust domestic manufacturing sector is the U.S. oil and gas production boom of the last five years,” said Thomas J. Duesterberg, executive director of The Aspen Institute’s Manufacturing and Society in the 21st Century program and the report’s co-author. “Higher levels of oil production require higher investment expenditures for capital equipment and construction, which in turn boost overall demand for goods. This stimulates the manufacturing sector and its supply and distribution chains. The resulting improvement in income and employment would boost the economy significantly.”

Donald A. Norman, Director of Economic Studies at the MAPI Foundation and report co-author, concurred. “It makes sense to export (lighter) oil to markets where it is more highly valued because it can command a premium price,” he said. “This will provide additional incentive for U.S. producers to develop domestic resources.”

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This was the finding of “Lifting the Crude Oil Export Ban: The Impact on U.S. Manufacturing,” a report sponsored jointly by The Aspen Institute’s program on Manufacturing and Society in the 21st Century and the MAPI Foundation, the research affiliate of the Manufacturers Alliance for Productivity and Innovation. Econometric modeling was conducted by Inforum, the Interindustry Forecasting Project at the University of Maryland.

“One of the most important drivers of a robust domestic manufacturing sector is the U.S. oil and gas production boom of the last five years,” said Thomas J. Duesterberg, executive director of The Aspen Institute’s Manufacturing and Society in the 21st Century program and the report’s co-author. “Higher levels of oil production require higher investment expenditures for capital equipment and construction, which in turn boost overall demand for goods. This stimulates the manufacturing sector and its supply and distribution chains. The resulting improvement in income and employment would boost the economy significantly.”

Donald A. Norman, Director of Economic Studies at the MAPI Foundation and report co-author, concurred. “It makes sense to export (lighter) oil to markets where it is more highly valued because it can command a premium price,” he said. “This will provide additional incentive for U.S. producers to develop domestic resources.”

Read Full Article

Ending Ban on Export of U.S. Crude Oil Would Benefit Manufacturing, Study Claims