(Reuters) – Facing intensifying election-year attacks over rising energy prices, President Barack Obama will seek on Thursday to shift the spotlight onto oil and gas companies by calling for the repeal of tax breaks that benefit the industry.
Republicans are seeking to use the energy issue to deny the president a second term, and Obama plans to push back on that criticism during a trip to Republican White House candidate Mitt Romney’s backyard of New Hampshire.
Previewing Obama’s speech in Nashua, a White House official said the president would emphasize there are no quick fixes for the pain at the pump.
“The president will make clear that while domestic oil and gas production has increased under his watch … the solution to high gas prices requires more than increased drilling,” the official said.
The official also said Obama would “reiterate his call to repeal the unwarranted $4 billion in annual subsidies handed out to oil and gas companies, and will urge Congress to take a vote on the repeal in the coming weeks.”
With the U.S. economy on the mend, rising gasoline prices are a threat to Obama’s re-election on November 6, and Republicans have stepped up their attacks over his record on domestic energy exploration and TransCanada Corp’s proposed Keystone XL crude oil pipeline.
The average retail price of gasoline is $3.74-per-gallon, up from $3.39 a year ago, according to the American Automobile Association. The combination of rising political tensions in the oil-rich Middle East and the onset of the higher-demand U.S. summer driving season could push gasoline prices significantly higher in coming weeks.
Obama rejected the Keystone XL pipeline, which was to run through environmentally sensitive areas of Nebraska from the U.S.-Canadian border.
On Monday, the White House said it welcomed a fresh proposal by TransCanada to build a southern leg of the pipeline and refile an application for the northern part of the route.
REGULATIONS ON ENERGY COMPANIES
Republicans complain the president has hobbled domestic oil exploration and dismiss his administration’s observation that U.S. oil output is at a record high, arguing this was thanks to the action of his Republican predecessor, George W Bush.
“The Obama administration continues to impose burdensome regulations on the domestic energy sector that will further drive up the cost of gasoline for the consumer,” Mitch McConnell, the top Senate Republican, said on Wednesday.
Obama has sought to put Republicans on the defensive by urging the U.S. Congress to repeal tax code provisions that benefit the oil and gas industries. Republicans counter that such changes should be weighed as part of a comprehensive rewrite of a complicated and inefficient tax code.
Obama’s visit to the Nashau Community College is his second trip in three months to the swing state, where Romney is expected to be a tough competitor if he wins the nomination to face Obama in November.
Romney, a former governor of neighboring Massachusetts, owns a home on Lake Winnipesaukee in New Hampshire. In January, Romney racked up a strong win in the Republican primary in New Hampshire, helping to give his campaign momentum.
“The primary results here indicate that Romney will give the president a fight in this purple state,” said Linda Fowler, a professor of government at Dartmouth College, who saw the economy as the big focus of the campaign, rather than social or cultural issues.
Wins over Republican rival Rick Santorum in Michigan and Arizona on Tuesday helped Romney reassert his front-runner status.
In New Hampshire, polls place Romney within range of Obama in a November match-up, even though the president carried the state in 2008. A still-sluggish recovery and historically high unemployment have weighed on Obama’s support.
“Independents are the key. They went for Democrats in 2006-08, but shifted to the GOP (Republicans) in 2010,” said Fowler, referring to the mid-term congressional elections in which Democrats sustained heavy losses.
(Additional reporting by Caren Bohan; editing by Philip Barbara and Mohammad Zargham)
