On Friday, December 18, 2015, the U.S. House of Representatives and the Senate passed a bill to fund the federal government through September 2016, which includes a provision lifting the 40-year-old ban on the export of crude oil. President Obama signed the bill into law Friday afternoon.

This is a historic victory for the oil industry and comes shortly after the United States and over 200 other countries supported an international climate deal aimed at reducing emissions from oil and other fossil fuels, which was largely opposed by the industry. Since at least 2013, several oil companies have lobbied Congress to lift the ban on oil exports, arguing that allowing exports would stimulate the U.S. economy and eliminate market distortions, while boosting national security.

Congress originally moved to ban oil exports after a 1973 Arab oil embargo that drastically increased the price of domestic gasoline. The United States currently exports almost 400,000 barrels of crude oil each day to Canada, which is the largest exempted activity under the ban, but accounts for only 3.8 percent of the amount of oil produced each day in the U.S. The export of refined petroleum products is unlimited, and after a 2014 Department of Commerce approval, exports of a type of light oil known as lease condensate are increasing.

Some U.S.-based refiners oppose the export of crude oil, asserting that their businesses would be impacted if crude were exported for refining, and warning that higher prices may be passed on to consumers and could increase the refiners’ cost to acquire feedstock. To calm these concerns, the spending bill alters a tax deduction for domestic manufacturing so these refiners may deduct a majority of the transportation costs associated with their business. The bill also addresses concerns about high gasoline prices, enabling the president to restrict oil exports for up to one year in certain situations, including if there is a shortage in supply or if oil prices are significantly higher than the global price. Although President Obama had previously threatened to veto separate legislation lifting the oil export ban, the administration supported the overall spending bill because it also includes multiyear extensions of solar and wind tax credits, as well as a one-year extension for other renewable energy technologies the president has continually supported.