- Associated Press - Wednesday, March 7, 2012

Congressional Republicans and oil industry leaders called Wednesday for more U.S. gas production to counter rising prices, which are fast becoming an issue in the presidential campaign.

Democrats focused on conservation and the role of Wall Street speculators in driving up prices.

Jack N. Gerard, CEO of the American Petroleum Institute, told a House energy panel the nation has vast energy resources that aren’t being fully tapped. New leasing on federal lands is down by 44 percent, and the number of new wells drilled is down 39 percent, Mr. Gerard asserted.

And while President Obama calls for “all-of-the-above” energy approach, he has threatened the oil and gas industry with billions of dollars in tax increases, Mr. Gerard said.

“Mr. Chairman, this is sending the wrong message to the global markets. This needs to change,” Mr. Gerard said, referring to Mr. Obama’s call to end tax breaks and government subsidies for the oil and gas industry that average about $4 billion a year.

Democrats said oil production has increased since Mr. Obama took office. They blamed the recent spike in gas prices on tensions in the Middle East and speculation by Wall Street investors.

Oil prices rose above $105 a barrel Wednesday, up from $75 in October, because of diplomatic tensions with Iran, a major oil producer, and as U.S. economic indicators including employment have slowly improved over the past few months.

Gas prices have jumped 48 cents since Jan. 1 to an average $3.76 per gallon.

Rising gas prices have become a concern at the White House, where Obama aides worry the increases could hurt an economic recovery that has been improving and also harm the president’s re-election prospects.

Mr. Obama was in North Carolina on Wednesday promoting fuel-efficient cars and tax incentives he contends will help reduce dependency on foreign oil. He has called for 1 million plug-in vehicles on American roads by 2015.

Rep. Fred Upton, a Michigan Republican and chairman of the House Energy and Commerce Committee, said Mr. Obama has recently “begun to say some of the right things about high gas prices, but he continues to do all of the wrong things.”

While Mr. Obama boasts that domestic drilling is up, he neglects to mention that most of the increase is on private and state-owned lands, Mr. Upton said, noting that the Obama administration has canceled oil leases on federal lands.

Rep. Henry A. Waxman, California Democrat, said GOP calls to increase drilling were all too familiar.

“We’ve seen this movie before,” Mr. Waxman said. “The reality is that gas prices have risen because of global markets.”

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