Obama to seek $10-a-barrel oil tax

WASHINGTON — President Obama plans to seek a $10-a-barrel oil tax to overhaul the nation’s transportation system toward reducing carbon emissions.

In a statement from the White House Thursday, the administration expressed plans to spend more than $300 billion over the next decade, expanding rail and mass transit networks, modernizing freight transportation and expanding research into self-driving cars.

“Our nation’s transportation system was built around President Eisenhower’s vision of interstate highways connecting 20th century America” the White House said. “This new approach to investment and funding is one that places a priority on reducing greenhouse gases, while working to develop a more integrated, sophisticated, and sustainable transportation sector.”

Full details of the proposal are expected to be laid out when the White House releases its budget next Tuesday.

Already the administration is attempting to sell the proposal as one that will not only cut carbon emissions but make the nation’s transportation system more efficient.

Obama is likely to face a defiant Republican majority in Congress, which has consistently pushed back against his climate change initiatives.

U.S. Rep. Pete Olson, R-Sugar Land, tweeted Thursday afternoon, “Disgusted that @POTUS wants to slam consumers — and Houston’s economy — with an extreme oil tax. This idea is DOA.”

The proposal comes at a time the U.S. oil industry is struggling under historic lows in the price of crude, decimating stock prices and raising the specter of bankruptcy around many producers.

“At a time when oil companies are going through the largest financial crisis in over 25 years, it makes little sense to raise costs on the industry,” Neal Kirby, director of public affairs at the Independent Petroleum Association of America, said in a statement. “This isn’t simply a tax on oil companies. It’s a tax on American consumers who are currently benefiting from low home heating and transportation costs.”

Americans are currently enjoying a relative bargain at the pump, with gasoline selling for less than $2 a gallon across much of the country.

The American Petroleum Institute, a trade group, estimated Thursday the proposed oil tax would raise the price of gasoline 25 cents a gallon.

Under the White House proposal, the government would spend an additional $20 billion a year to expand mass transit systems across cities and countryside and another $10 billion a year to overhaul how transportation funding is distributed among cities and states.

Also, the government would invest more than $2 billion a year in researching cleaner burning cars and planes, as well as self-driving cars.