Obama seeks $10-per-barrel oil tax to fund clean transport

As part of his budget recommendations next week, President Barack Obama will propose spending almost $6 billion more on programs created to help young people land their first job.

The proposed fee, which would be paid by oil companies and phased in over five years, was quickly met with scorn by lawmakers in the Republican-controlled Congress.

“I’m the president’s economic adviser, so I’m going to stick to the economics”, ZIents said.

The U.S. imports quite a lot oil even though it has become more self-reliant in recent years.

The oil industry may be in a downturn due to the fact that it is producing too much, but the biggest companies are still pulling in hundreds of billions of dollars a year in revenues, benefiting from tens of billions in energy subsidies per year in the United States alone.

It’s not clear exactly where along the production chain the fee would be levied or whether it would be imposed on American oil that is not exported.

Obama wants the new revenue to pay for an upgrade to the country’s transportation system. “But our transportation system certainly is not”.

That would include making high-speed rail a viable alternative to flying in major regional corridors and invest in new rail technologies, the White House said. The new fee on oil will also encourage American innovation and leadership in clean technologies to help reshape our transportation landscape for the decades ahead.

House Speaker Paul Ryan called the plan “dead on arrival” and “an election-year distraction”.

“It really has no chance”, said Joe McMonigle, a senior energy analyst at Potomac Research Group who previously served as chief of staff at the Energy Department.

But oil companies and oil-state lawmakers from both parties are likely to be at least as opposed to the idea as they would be otherwise, given that the industry is hurting from cheap oil. Nearly all oil companies have cut jobs, many have filed for bankruptcy and others have defaulted on their loans. He declined to elaborate on how the fee would impact prices at the pump, but a $10 increase in the cost of a barrel of oil usually translates into 33 cents a gallon.