Gas prices are soaring and while Americans are feeling the pain at the pump, President Obama may soon be feeling it on the 2012 campaign trail. In an interview on Varney & Co., The Wall Street Journal's Peter Gigot said rising prices are a major problem for the president.
"It is a huge political problem and I am not sure he can do much about it," he said.
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Although the president has called upon the Justice Department to look into the role oil speculators are playing in the rising prices, Gigot believes it will produce few results.
"I think he will find out that they are trading and there is no real crime there," he said.
While this task force is not the answer, Gigot says, neither is demonizing oil companies.
"I have never in my political experience known a politician who when gas prices are high didn't demonize oil companies, particularly when they come up with big earnings," said Gigot, who added that doing so will not lower gas prices.
According to Gigot, Obama's best change for a solution comes from addressing the two components driving the increase in gas prices. First, the continual printing of money by Federal Reserve Chairman Ben Bernanke. Second, the turmoil in the Middle East.
"We don't know how much each is feeding into the mix of $111-113 oil, but both are playing in," said Gigot.
Without a new monetary policy and some resolve in the Mideast, Gigot believes this summer will be rough at the pump. The same could be true for 2012. According to Gigot, if gas is $4.50 at that time, the president will not win reelection.
"The president wants to say I saved you from the crash. I saved you from the meltdown. But if people are saying well, you had four years and it still looks mediocre, to me that is a very tough reelection campaign."