I’ve been reading quite a few stories in the news recently covering President Obama’s final fiscal 2010 federal budget proposal and the impact that the new taxes and other provisions could have on future domestic energy supplies.
Earlier this year, the American Gas Association (AGA) issued a release on the President’s proposed budget, which details AGA’s concerns about the budget’s potential negative impact on natural gas customers through higher energy prices. It looks like we’re not alone on this.
Here’s a story from the New York Times where John Felmy, chief economist at the American Petroleum Institute, says the impact of the budget on the industry will be to raise taxes on producers. The concern then being that most of this impact will be passed on to consumers in the form of higher fuel costs.
The Independent Petroleum Association of Mountain States believes that the budget tax increases are most harmful to small American energy companies that produce the clean, affordable and abundant American natural gas that we need to increase energy security, make renewable energy sources viable, and address climate change.
In another story from the Oil and Gas Journal, Barry Russell, the president of the Independent Petroleum Association of America, says that the budget “does not recognize that in order to decrease our reliance on foreign oil, we need to increase our own American supplies of natural gas and oil.”
These are just a few of the articles I came across. Many are concerned that the President’s budget would make it harder to develop America’s domestic natural resources by repealing existing tax provisions that encourage American production, as well as creating new excise taxes on offshore production and new user fees that will add to the overly complex and costly permit process.
By discouraging the production of America’s cleanest-burning, domestically abundant fossil fuel, this budget could ultimately tighten domestic supplies of natural gas; therefore, causing financial burden on consumers through higher energy prices, higher monthly natural gas bills, and higher unemployment through the loss of well-paying American jobs.
After reading those articles, are you concerned?