President Barack Obama used the power of his Executive Office “pen” Wednesday morning to allow the U.S. Commerce Department to issue a ruling that all but terminates a four-decade Congressional restriction against exporting U.S. domestically produced crude oil.

The new rule re-interprets a “refined” oil exemption in the laws to include crude oil that has been stripped of natural gas liquids. This process is commonly used by ports in exporting countries to safely load crude oil onto ocean tankers. As Breitbart reported on June 3rd, allowing crude oil exports will probably spur domestic crude oil production by up to another million barrels per day but may cause a rise in domestic gasoline prices.

The primary laws restricting crude oil exports are the Mineral Leasing Act of 1920, the Energy Policy and Conservation Act of 1975, and the Export Administration Act of 1979. The only exempt exports are crude oil produced in Alaska’s Cook Inlet or oil exported to Canada and consumed there. All other exports require licenses from the Department of Commerce for what are called “short supply controls” under the Export Administration Regulations (EAR). For decades, small amounts of refined gasoline and diesel have been shipped to U.S. Territorial island possessions in the Caribbean and Pacific.

But American exports of “refined” oil products have leaped from about 50,000 barrels per day (bpd) in early 2013 to 268,000 bpd in April of 2014. This ability to capture higher international oil prices explains why U.S. consumers have not seen a big fall in gasoline prices at the pump despite the U.S. fracking boom.

Recently, there have been a number of fiery crashes from “oil-trains” carrying crude oil out of North Dakota’s Bakken and Three Forks fields, where hydraulic fracking of shale has created a spectacular American domestic oil boom. One of the potential reasons for the explosiveness of the oil-train crashes is that Bakken crude is not being stripped of flammable natural gas liquids (NGLs) before the crude oil moves by rail.

Infrastructure to “stabilize” crude oil by degassing NGLs can cost billions of dollars. This type of infrastructure is expected of large economy-of-scale crude oil loading operations, such as an oil tanker port or the proposed Keystone XL Pipeline. The Bakken is 1,500 miles north of the U.S. Gulf Coast, which is the biggest market for NGLs in the nation. Bakken producers and logistics companies have little economic incentive to invest in stabilizers and pipelines while they are being allowed to load all their crude oil production into railcars.

The Commerce Department issued its ruling after Pioneer Natural Resources Co. petitioned for approval to export a type of Bakken ultra-light crude oil that would require minimal stabilization for ocean tanker export. The investment to build a stabilizer plant for this type of crude oil would be about “one-tenth the cost of a complex, full-scale refinery.”

The general media has naively echoed a comment by Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas SA in London, to Bloomberg News that “It’s a crack in the door which has otherwise been shut for 40 years.” But given that pressurized degasification of crude oil is standard procedure for ports at all major oil exporting countries around the world, the new definition of “refined” opens up the possibility for millions of barrels a day of U.S. crude oil exports.

The author welcomes feedback and will respond to reader comments.