The US oil industry, in the midst of a pricing crisis, is trying to assess the impact of a year-end move by the US government to relax restrictions on the export of partially processed oil products.

The potential for the export of lease condensate has been estimated at 230,000 barrels per day (bpd) in 2015 growing to 800,000 bpd by 2019, according to one industry source. But the near-term impact is muddied by the continuing oil price decline.

The change does not affect the ban on the export of unprocessed crude oil, which would require Congressional approval. But it might be a step toward freeing up exports altogether as a new Congress confronts the impact of the oil pricing crisis.

The ban on exports was put into effect several decades back when US production was declining; now, US and Canadian production is looking for global outlets.

The under-the-radar announcement from a small government agency at year-end gave the go-ahead to lease condensate exports and also clarified the rules on re-exporting Canadian crude. The latter would make it easier to move oil from the Canadian tar sands through Gulf ports onto the world market.

The Canadian clarification coincided with separate moves that could encourage the shipment of heavy oil from the tar sands and, incidentally, set up a further confrontation with Middle East producers defending their perceived market share.

Congress appeared determined to approve the Keystone pipeline which could ultimately carry Canadian oil south, and two new pipelines with capacity of more than one million bpd have recently opened for business in a parallel southbound lane.

Lease condensate is a light hydrocarbon liquid produced with gas liquids that has been processed through a distillation tower. Earlier in 2014, two producers were granted export licenses but the government rules were not clarified and other producers were left hanging. Fracking has produced a surplus of light oil beyond the needs of Gulf refineries, and the condensate and other light products have exceeded domestic demand.

The condensate could presumably appeal to global petrochemical plants, particularly in the Far East. But that would depend on the addition of actual production capacity and the economics of using various competing feedstocks. Ethylene crackers can use ethane or propane as well as naphtha, a key condensate product.

The bottom line is that the short-term demand might be minimal, dependent on a recovery in international oil prices.