Energy Business

Steelworkers Union Opposes U.S. Crude Oil Exports

Oil refinery
Source: Thinkstock
As the argument heats up on whether the United States should revoke its 40-year ban on crude oil exports, a variety of interest groups will be choosing sides and adding their voices to the discussion. Monday’s addition is the United Steelworkers (USW) union, which announced that it opposes a lifting of the ban on U.S. crude oil exports.

The USW says eliminating the ban would “cost jobs at U.S. refineries, raise prices at the gas pump, decrease national security and increase environmental degradation.” The union is siding with refiners like Valero Energy Corp. (NYSE: VLO), PBF Energy Inc. (NYSE: PBF) and Monroe Energy, the refining arm of Delta Air Lines Co. (NYSE: DAL).

On the other side, the American Petroleum Institute (API) and the U.S. Chamber of Commerce have come out in support of producers. Exxon Mobil Corp. (NYSE: XOM) has called for the elimination of the export ban, as has Chevron Corp. (NYSE: CVX) and most other big oil producers.

The USW’s position is predicated on what it sees as lost jobs if refineries either cut back on production or shut down altogether as a result of cheaper American crude reaching international markets:

While crude oil expenses for U.S. refiners would rise if the crude oil export ban is rescinded, it would decrease costs for refiners in other countries as the pool of crude oil in the world increases, dropping prices. This negatively impacts U.S. jobs, as domestic refiners are forced to compete with refiners outside the U.S. that have lower labor costs and fewer safety and environmental controls.

Refinery job loss impacts an entire community. Studies have shown that up to 10 secondary jobs are lost for each direct job at the refinery.

Refinery workers were added to the USW’s rolls in 2005 when the union merged with the Paper, Allied-Industrial, Chemical and Energy Workers International Union. The union claims 850,000 active members.

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