President Obama repeated his demand for Congress to eliminate an estimated $4 billion in tax breaks for the major oil and gas companies.

Obama noted that domestic oil production reached its highest level last year since 2003, but added that the U.S. needs to invest more in renewable energy sources. Obama wrote to congressional leaders last Tuesday asking them to write legislation to eliminate the tax breaks and reiterated the demand in his weekly address (see Obama Urges Elimination of Oil Producer Tax Breaks).

During the address on Saturday, Obama noted that in some places, gas now costs more than $4 a gallon, meaning that vehicle owners could be paying at least $50 or $60 to fill up their gas tanks. Meanwhile, oil companies are reporting near-record profits this quarter.

“While rising gas prices mean real pain for our families at the pump, they also mean bigger profits for oil companies,” said Obama. “This week, the largest oil companies announced that they’d made more than $25 billion in the first few months of 2011—up about 30 percent from last year. Now, I don’t have a problem with any company or industry being rewarded for their success. The incentive of healthy profits is what fuels entrepreneurialism and helps drives our economy forward. But I do have a problem with the unwarranted taxpayer subsidies we’ve been handing out to oil and gas companies—to the tune of $4 billion a year. When oil companies are making huge profits and you’re struggling at the pump, and we’re scouring the federal budget for spending we can afford to do without, these tax giveaways aren’t right. They aren’t smart. And we need to end them.”

Obama emphasized that the country has to invest more in clean energy sources. “Already, we’ve seen how the investments we’re making in clean energy can lead to new jobs and new businesses,” he said. “I’ve seen some of them myself—small businesses that are making the most of solar and wind power, and energy-efficient technologies; big companies that are making fuel-efficient cars and trucks part of their vehicle fleets. And to promote these kinds of vehicles, we implemented historic new fuel-economy standards, which could save you as much as $3,000 at the pump.”

Despite the elimination of oil industry tax breaks, Obama said he would refuse to cut funding for clean energy development. “An investment in clean energy today is an investment in a better tomorrow,” he said. “And I think that’s an investment worth making.”

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