Gas prices must come down, consumers say

10:20 AM, Mar 9, 2012   |    comments
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By Gary Strauss, USA TODAY

Consumers fretting about soaring gasoline prices say President Obama and Congress must act to keep them from rising further, a Gallup Poll finds.

An overwhelming number of consumers - 85% - say Obama and Congress should take "immediate" action to keep a lid on prices. After nearly four weeks of daily price increases, regular gasoline averages $3.76 a gallon nationwide.

Industry analysts still expect a $4 top by Memorial Day, although prices could rise to $5 a gallon if escalating tensions in the Middle East disrupt crude oil shipments. At $5, about 30% of those surveyed by Gallup say they would have to make major changes in their lives and significant cutbacks in spending. About 28% say $4 gas would prompt similar changes.

Typically, seasonal demand accounts for higher prices. But this year, U.S. consumption has fallen to its lowest levels since the late 1990s. Industry analysts say speculators, lower refinery output and foreign demand have driven prices to record winter highs.

The Gallup Poll underscores consumer sentiment about a hot-potato issue in an election year. Republican presidential contenders blame rising gas prices on Obama, while Obama counters that there is no quick fix.

"We'll continue to see plenty of blame attributed to both parties if we see prices go higher," says Tom Kloza, chief analyst for the Oil Price Information Service. "But there is very little a president can do to impact gas or crude oil prices over the short term."

Just 31% in the Gallup survey agree that gas prices are largely beyond the control of Obama or Congress. The poll of about 500 adults was taken Monday and Tuesday; it has a margin of error of plus or minus 5 percentage points.

The American Petroleum Institute on Thursday urged Obama to spur domestic energy development and approve the controversial Keystone pipeline, which would push oil from Canada to Texas refineries. Such moves would help ease crude oil prices, API chief Jack Gerard says.

Obama advocates better fuel efficiency and alternative fuel sources, such as natural gas. He rejected the Keystone proposal in January, citing insufficient time to review its environmental impact. A Republican bid to speed approval of the pipeline was defeated in the Senate Thursday.

Crude oil prices may not provide any relief. They are expected to stay around $107 a barrel, where they are now, according to the Organization of the Petroleum Exporting Countries' latest monthly forecast.

OPEC is predicting a flat market for oil due to weak economic performance in developed nations.

The forecast sees world oil demand growing by 900,000 barrels a day - unchanged from its previous report.

In its forecast issued Friday, OPEC says "the weak pace of growth in the OECD economies (in Europe) is negatively affecting oil demand."

The forecast goes on to say that while the U.S. economy has improved, Europe's debt crisis "along with higher oil prices has resulted in considerable uncertainties for future oil demand for the rest of the year."


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