UPDATE 4-Obama defends energy policies amid gas price pain

Mon Mar 12, 2012 3:22pm EDT

* Obama, acknowledging pain of high gas prices, sees progress

* US oil imports down 1 million bpd last year - W.House report

* Republicans say president's policies a failure on gasoline

By Alister Bull

WASHINGTON, March 12 (Reuters) - President Barack Obama launched the most comprehensive defense to date of his energy policies on Monday, pushing back against election-year attacks from Republicans who say they are to blame for high gas prices that are eroding his popularity with voters.

Heralding a report on energy security showing a big drop in U.S. oil imports, Obama acknowledged pain at the pump that analysts fear could lift gasoline to $5 a gallon in some parts of the country and pose a threat his Nov. 6 bid for re-election.

"Today's high gas prices are a painful reminder that there's much more work to do to free ourselves from our dependence on foreign oil and take control of our energy future," Obama said in a statement on the energy report. "We have made progress."

The 20-page study, which highlighted rising domestic oil and gas production and Obama's steps to lift fuel efficiency, showed U.S. oil imports declined to 8.4 million barrels a day by the end of 2011, versus 11 million barrels a day in January 2009.

The White House said his policies were tackling a troubling topic for many Americans. This was underlined by a new Washington Post-ABC poll, which showed disapproval of Obama's handling of the economy increased to 59 percent, from 53 percent when the survey was taken last month.

Nearly two-thirds of those polled said they did not approve of his handling of the situation with gas prices.

Republicans complain that Obama has hobbled the energy industry with red tape and point to the administration's block on TransCanada Corp's Keystone XL oil pipeline project to support their contention that he is hostage to environmentalists in his political base.

"With this report, the president is celebrating his recipe for four or five dollar gas. Poll after poll shows Americans overwhelmingly disapprove of the president's work on gas prices," said Brendan Buck, spokesman for House Speaker John Boehner, the top Republican in Congress.

The price of gasoline at the pump has risen more than 12 cents to a national average of $3.81 a gallon in the past two weeks, according to the Lundberg Survey released on Sunday. The highest price, of $4.35 per gallon, was recorded in Los Angeles.

Analysts see no quick fixes to the challenge in the time remaining until the November election.

"There's nothing the president can do that's going to alleviate the gasoline price rise or reduce oil imports by another one million bpd," said Charles Ebinger, director of the energy security initiative at The Brookings Institution.

ELECTION HEADWIND

Rising gas prices could sap consumer spending and undermine economic confidence, which has been lifted by recent encouraging data that was capped on Friday by a better-than-expected February jobs report.

The economy, which is slowly recovering from a savage recession in 2008-2009 but is still hampered by an unemployment rate of 8.3 percent, is expected to be a decisive factor in whether Obama can manage to hold on to the White House for a second term.

Obama visited election battleground states North Carolina and Virginia last week to promote his message. He will speak at the White House on Monday with local television stations serving swing states, including Colorado, Nevada and Pennsylvania.

Oil prices have been buoyed by improving confidence in the outlook for the U.S. and world economy, as well as heightened concern of fresh military conflict in the Middle East amid warnings from Israel over Iran's nuclear program.

Eager to reduce U.S. dependence on foreign oil, the White House report noted that net oil imports as a share of total U.S. consumption declined from 57 percent in 2008 to 45 percent in 2011, "the lowest level in 16 years."

Obama also has told his administration to look into possible manipulation in the oil market as well as evidence of price gouging at the pump, and has not ruled out tapping the nation's Strategic Petroleum Reserve to ease supply pressures.

"All options are at the table, because the president obviously feels the pain that the American people are facing with respect to gas prices," U.S. Secretary of the Interior Ken Salazar told reporters during a White House briefing.

However, even a substantial release from reserves might not bring down pump prices.

"In the next six months, even drawing down the SPR as fast as possible, which I wouldn't advocate, is not going to see much impact," said Brookings' Ebinger.

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Comments (126)
Aquaterra wrote:
“Democrats have a commonsense plan to help bring down skyrocketing gas prices…”

- Nancy Pelosi, August 24, 2006.

It’s been almost six years since Pelosi promised that Dems have a real plan to help with gas prices.

Does ANYONE know what that plan is? Or was that just another lie?

Mar 12, 2012 5:56pm EDT  --  Report as abuse
mbitsko wrote:
Pump prices are based on crude oil prices, and those are based on commodities speculation. It’s an emotionally driven situation.

Obama could use that to our advantage if he chose to do so. He could eliminate the Federal tax on diesel fuel. That would immediately reduce the cost of shipping goods to market, and thus fight consumer price inflation. It would encourage consumers to buy diesel powered cars and trucks, which use at least 25% less fuel than their gasoline equivalents. Most importantly, it would panic the crude oil market and cause prices to plummet.

The economy would benefit, and the increase in tax revenues from other sources would more than make up for the loss of fuel taxes.

It’s a win-win all around, unless you’re an oil producer.

Mar 12, 2012 5:58pm EDT  --  Report as abuse
obamalover wrote:
We should be talking about something more important.

Free condoms for all

They are birth control devices

They positively affect womens health by reducing STDs.

The Obama administration is sexually discriminating against men by giving women birth control pills but not giving men condoms.

Free condoms for all.

Mar 12, 2012 5:58pm EDT  --  Report as abuse
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