Oil shipped abroad to bring higher (or lower) prices at home?

17-Jan-2016

Beginning this month, the world's largest economy is doing something it hasn't done in 40 years: shipping supplies of U.S. crude oil to international markets. So will globally traded domestic crude translate into higher gas prices at home?

"Absolutely," said Tyson Slocum, energy director at the Washington-based consumer advocacy group, Public Citizen. Despite oil prices slumping to their lowest levels in 12 years, Slocum told CNBC's "On the Money" that he expects the "(oil) market will tighten later this year."

He's far from the only one who thinks that way. Last week, Goldman Sachs said in a research note that it expects oil to rebound back above $40 by midyear.

And Slocum's remarks echo the concerns voiced by supporters of the four decade law that prohibited U.S. oil sales abroad, who have argued that exporting crude would limit domestic supplies, thereby driving up prices.

Slocum, however, said "we're not going to see the impact right away, because both the domestic and international oil market is saturated with excess oil and storage." (by Trent Gillies, CNBC)