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Keeping close eye on spiraling gasoline prices: White House

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SummaryHedge funds have placed large bets on higher oil prices, taking their total positions close to the highest level ever reported.

The White House is keeping an eye on surging gasoline prices but spokesman Jay Carney on Thursday said he had no comment on whether the Obama administration was looking at tapping emergency oil reserves as a way to tamp down prices.

The White House looked at whether to release oil from the Strategic Petroleum Reserve (SPR) in 2012, when gasoline prices were stubbornly high during the peak summer driving season, which coincided with the election campaign.

After weeks on the rise US gasoline prices are now at the highest level ever for this time of year, which is typically a time of lower seasonal demand, squeezing the household budgets of many Americans.

Average US gasoline prices were $3.78 per gallon for regular unleaded, up 47 cents in the past month, the American Automobile Association (AAA) said on Thursday, attributing the steep run-up in part to seasonal maintenance at refineries.

Asked whether the White House was considering using the SPR to take the edge off prices, Carney instead talked about steps the administration has taken to boost oil production and reduce gasoline consumption.

"I have no announcements or comment on the SPR. As you know, we keep all options on the table," Carney said, repeating a phrase the White House often used last year.

The SPR is an emergency storage facility of oil maintained by the US Department of Energy with the goal of mitigating temporary supply disruptions such as those sometimes created by extreme weather or heightened tensions in the Middle East.

Domestic crude oil production is booming as producers use hydraulic fracturing or "fracking" to blast supplies from shale rock deep beneath states like North Dakota and Texas.

Carney said there has been significant reduction in US dependence on, and imports of, foreign oil. "We need to take steps so that that progress continues," he said.

Some Democrats have blamed speculation for pushing up energy prices. Hedge funds have placed large bets on higher oil prices, taking their total positions close to the highest level ever reported.

This week Bart Chilton, a Democratic commissioner at the top futures regulator, said more should be done to cap the number of contracts speculators can hold.

The Commodity Futures Trading Commission had developed position limits for commodity markets, but they were struck down last year by a judge who ruled the regulator had failed to show speculators affect prices. The CFTC is appealing. Carney said the White House would

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