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Letter from Jack Gerard – $10 Energy Tax Hike Could Harm Consumers

Posted on Feb 10, 2016

Gas TaxBelow is a letter from Jack Gerard, the president of American Petroleum Institute. The letter warns consumers that the White House’s new budget will add a $10 per barrel tax on crude oil. The Tax could raise consumers cost per gallon by an estimated 25 cents.


February 10, 2016

Dear American Petroleum Council Member,

Apparently, the Obama administration has decided Americans aren’t paying enough for gasoline. A proposal in the White House’s new budget to add a $10 per barrel tax on crude oil could raise consumer costs by an estimated 25 cents per gallon of gasoline, according to published reports.

With the U.S. economy growing at a weak 0.7 percent, raising taxes on energy makes no sense. Adding about 30 percent per barrel to the cost of oil risks raising prices on everything that relies on transportation to get to consumers – including food. Lower-income and middle class Americans, for whom essentials like transportation and grocery bills consume a greater percentage of their paychecks, stand to see the most harm.

Government policy should be focused on strengthening American energy security and global competitiveness, but this tax hike proposal could undermine both – just as Iran has announced plans to export 300,000 barrels of crude oil per day to Europe.

The energy resurgence has created jobs, cut fuel imports and delivered tangible benefits to American families and businesses – with average savings of $1,200 per year per household. Consumers saved more than $500 just in transportation fuel last year, home heating costs have declined and electricity costs dropped 27 to 37 percent nationwide. The United States leads the world in both the production of oil and natural gas and in carbon reductions – with the availability of clean-burning natural gas playing a primary role in emissions progress.

Why put all that at risk? With no more elections ahead, it seems the administration’s final months in office will be spent pursuing its true energy policy objective: to choke off America’s energy renaissance and keep fossil fuels in the ground.

The $10 cost hike should be a wake-up call. This is what “leave-it-in-the-ground” ideology really means: harm to consumers, diminished American competitiveness, weakened energy security and a return to energy dependence.


Jack Gerard
President and CEO


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