Lawmakers Push for Crude Exports to Mexico

The chairman of the U.S. Senate's Energy Committee and 20 colleagues on Wednesday urged the Commerce Department to allow crude oil exports to Mexico, saying it would benefit the economies of both countries.

Republican Senator Lisa Murkowski, the committee's chairman, and Heidi Heitkamp, a Democrat, urged Commerce Secretary Penny Pritzkerto to approve a pending application from Mexico's state oil company Pemex to swap heavy Mexican crude oil for light U.S. crude.

Existing U.S. laws "clearly authorize swaps and exchanges" of oil to Mexico that "should be authorized without delay," said a letter signed by Murkowski, Heitkamp and 19 other Senators, most of them Republicans.

The United States has allowed some oil exports to Canada since 1985 for use or refining within the country. It does not allow such shipments to Mexico.

Pressure to relax the U.S. oil export ban has risen as the domestic drilling boom of the last five or six years led to a glut of light crude along the U.S. Gulf, where refineries mostly run on heavier oil.

Murkowski is an avid supporter of relaxing the trade restriction, a remnant of the Arab oil embargo of the 1970s. While there is no clear time frame for legislation to relax the ban, Murkowski has been pushing the Obama administration to take action in a series of steps, including swaps with Mexico.

The senator met privately with Pritzker last year on the export ban. On Wednesday, she told reporters in Juneau that U.S. oil could help fill any future gaps in global supplies resulting from political unrest in the Middle East. "It's an opportunity for us to lead from an energy security perspective and from an economic security perspective."

The administration has told several oil producers in the last two years they can freely export a minimally processed light oil called condensate. Energy companies say more needs to be done to avoid a glut of crude that could eventually dampen the pace of the U.S. oil boom.

Pemex could be ready to start importing U.S. light crude within months after an approval, the company's chief executive said last month.

Under the proposal, Pemex would import up to 100,000 barrels per day of light crude and condensate to mix with its own heavier crude at domestic refineries. In exchange, the United States would get heavier Mexican crude for processing at its refineries.

The Commerce Department did not immediately comment on the letter.
 

By Timothy Gardner