Alaskan Crude Oil Exports
T-RCED-90-59, Apr 5, 1990
GAO discussed the potential consequences of lifting the existing ban on the export of Alaskan North Slope (ANS) crude oil, focusing on the changes in the Alaskan oil trade that are likely to occur and how those changes could affect the U.S. economy and energy security. GAO noted that: (1) removal of the ban would likely result in the export of ANS crude oil to Pacific Rim countries, since oil transport costs were low and the characteristics of ANS crude oil were more suitable to the needs of Pacific Rim refiners than to those of West Coast refiners; and (2) such exports and decreased Alaskan oil production would eventually result in decreased consumption of ANS crude oil by West Coast refiners and the elimination of more costly shipments to the East Coast, the Caribbean, and the Gulf of Mexico. GAO also noted that probable effects of exporting ANS crude oil would include: (1) an increase in the price of ANS crude oil at the wellhead and, subsequently, the price that West Coast refiners paid for crude oil; (2) increased economic efficiency through reduced oil transportation costs, increased domestic oil production, better use of refinery processing resources, and the allocation of ANS oil to its highest valued uses; (3) damage to the maritime industry, since oil would likely be transported on foreign-flag, rather than U.S.-flag tankers; and (4) increased total U.S. oil imports, but decreased net imports, to the extent that oil production and refinery efficiency would increase.