The Obama administration seems particularly intent on rolling back subsidies for the American oil and natural gas industry, as the Executive Office released a statement this Monday explicitly endorsing the passage of Senate Bill S. 2204 — Repeal Big Oil Subsidies Act.
The bill is currently undergoing debate in the Senate; its standing iteration lays out plans to scale back oil and natural gas industry entitlements over the span of a decade. In terms of financial specifics, the bill outlines an initiative to lift $21 billion in oil and natural gas industry tax breaks over a period of ten years — ultimately including the previously uncollected sum among a given year’s tax collection.
The March 26 statement directly claims:
The Nation’s outdated tax laws currently provide the oil and gas industry billions of dollars per year in these subsidies, even though the industry is reporting outsized profits. Furthermore, heads of the major oil companies have in the past made it clear that high oil prices provide more than enough profit motive to invest in domestic exploration and production without special tax breaks.
Irrespective of whether one believes this measure to be economically sound, it is clear that volatile oil geopolitics are bumping the market value of crude oil and its constellation of refined products to an exceptional high.
Adam Patterson is an Assistant Editor of InvestorPlace. You can follow him on Twitter @ToweringBabble.
The opinions contained in this column are solely those of the writer.
Want to share your own views on money, politics and the 2012 elections? Drop us a line at email@example.com and we might reprint your views in our InvestorPolitics blog! Please include your name, city and state of residence. All letters submitted to this address will be considered for publication.