US President Barack Obama signaled again on June 2 that he considers the Gulf of Mexico oil spill a wake-up call for Congress to pass climate-change legislation that will move the nation closer to alternative energy sources.
The president also reiterated his support for seeking and producing more oil off the US, and repeated his call to end what he considers unjustified tax breaks for US producers.
"The catastrophe unfolding in the gulf right now may prove to be a result of human error, or of corporations taking dangerous shortcuts to compromise safety, or a combination of both. And I've launched a national commission so that the American people will have answers on exactly what happened," Obama said during an economic address at Carnegie Mellon University in Pittsburgh.
"But we have to acknowledge that there are inherent risks to drilling 4 miles beneath the surface of the Earth, and these are risks…that are bound to increase the harder oil extraction becomes," he continued.
Obama reiterated his recognition that the US can't end its dependence on fossil fuels overnight. That was why he supported an offshore oil production plan as part of his administration's overall energy strategy a few weeks earlier, he explained.
'Short-term solution'
"But we can pursue such production only if it's safe, and only if it's used as a short-term solution while we transition to a clean energy economy," the president maintained.
It's time to aggressively accelerate that transition, he said. That means continuing to make homes and motor vehicles more energy-efficient, producing more domestic natural gas, and building more nuclear power plants. And, said Obama, "it means rolling back billions of dollars of tax breaks to oil companies."
Independent Petroleum Association of America Pres. Barry Russell immediately disagreed. "The president's call…for billions of dollars in new taxes on American oil and natural gas producers is not new, and is not good energy or economic policy," Russell said on June 3.
While some have characterized the proposals as taxing Big Oil, Russell said that repealing the percentage depletion allowance, doing away with expensing of intangible drilling costs, and increasing allowed geological and geophysical amortization would hurt independent producers instead.
'Worst option'
"The combination of increased taxes and halting offshore exploration seems like the worst option for the president to choose at this time," Russell observed. "Our policies should encourage responsible, American energy production, not shut down the industry altogether."
Obama also said that the only way to encourage private investment in clean energy is to put a price on carbon emissions. He noted that the US House passed such a bill in 2009, and that a bipartisan plan in the Senate would achieve the same goal.
"The votes may not be there right now, but I intend to find them in the coming months," the president said, adding, "We will get it done."
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