Obama on Oil: 'We Have Made Progress'

Energy Reuters

President Barack Obama, arming himself against election-year attacks on his energy policies amid painfully high gas prices, welcomed a report on Monday showing a one million barrel-per-day decline in U.S. oil imports in 2011.

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Obama is stepping up defense of his record amid concern that rising oil prices may lift the price of gasoline at the pump to $5 a gallon in some parts of the country this summer, which could pose a threat to the Democratic president's bid for re-election on Nov. 6.

"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 progress report on energy security. "We have made progress."

The report showed U.S. oil imports declined to 8.4 million barrels a day by the end of 2011 compared with 11 million barrels a day when Obama took office 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 the president's handling of the economy increased to 50 percent, from 46 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.

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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/gallon, was recorded in Los Angeles.

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.

ELECTION HEADWIND

The economy, slowly recovering from a savage recession in 2008-2009, but 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.

"We are monitoring the situation and certainly are willing to use all tools available to address these challenges," a White House official told reporters on a conference call to preview the report.

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