Obama floats US$10-a-barrel oil tax

Obama's proposal is designed to wean Americans onto more climate-friendly fuels.
Obama's proposal is designed to wean Americans onto more climate-friendly fuels.PHOTO: REUTERS

WASHINGTON (AFP) - US President Barack Obama on Thursday proposed a US$10-a-barrel tax on oil firms to pay for much needed infrastructure improvements.

The US$10 (S$14) charge, phased in over five years, would be levied on companies - but the costs could be passed on to consumers.

"For too long, bipartisan support for innovative and expansive transportation investment has not been accompanied by a long-term plan for paying for it," the White House said in a statement.

The proposal comes amid current low oil prices and is also designed to wean Americans onto more climate-friendly fuels.

The plan is highly unlikely to pass muster in the Republican-controlled Congress.