NEW YORK (TheStreet) -- From the IHS Energy CERAWeek conference in Houston, Pioneer Natural Resources (PXD - Get Report) CEO Scott Sheffield is again taking up the case for an end to the domestic oil export ban, and has predicted that it has a 40% to 50% chance of ending this year.
I tend to think it has no chance of ending any time soon, but the effect on the oil markets and certain oil stocks would be enormous if the ban were to be lifted.
The export ban on domestic crude oil has been in place since the 1970s and was a reaction to the OPEC oil crisis of 1973. Sheffield and other U.S. oil producers -- particularly Harold Hamm of Continental Resources (CLR - Get Report) -- have been clamoring for an end to the export ban and access to global markets for their crude supplies.
Since the fall in oil prices, the chorus of protest has grown louder as oil companies search for euro markets that will pay them as much as $12 more a barrel for crude oil. This would go a long way to ease the distress inside the U.S. oil industry as well as end an anachronistic law that has no modern role in today's markets.
While I could argue the export ban continues to have a tremendous importance today in my upcoming book, Shale Boom, Shale Bust, for now, let's examine the winners and losers should an export ban be eliminated in 2015, as Sheffield predicts.
For one, clearly the producers of oil that has been flooding the Gulf Coast from the East Texas Eagle Ford shale play and the West Texas Permian shale play would be given an instant boost. Including basis discounts from the Gulf Coast, many of these producers would realize more than $10 a barrel for their crude, even including transport costs. This would include players like Pioneer, Cimarex (XEC - Get Report), Diamondback (FANG - Get Report), Anadarko (APC) and EOG Resources (EOG - Get Report), to name just a few.
The clear losers would be the refiners, particularly the Gulf Coast refiners that have enjoyed glutted markets and discounted prices for crude oil. With open access to export, much of that discount would immediately disappear. Much of the run in refiners like Valero (VLO - Get Report) and Phillips 66 (PSX - Get Report) has been due to discounted differentials in crude from global benchmarks. Once those are gone there is less reason to own these refiners.
Still with few incentives to remove the ban save for the advantage of a few U.S. producers, I still do not see this as a likely outcome. Once we move closer to the 2016 election, I see it as impossible.
I talk more about the export ban with Jill Malandrino in the video above.