Obama Says New Task Force Will Examine Gas Prices

President Barack Obama said Thursday that the Justice Department will try to "root out" cases of fraud or manipulation in oil markets, even as Attorney General Eric Holder suggested a variety of legal reasons may be behind gasoline's surge to $4 a gallon.

"We are going to make sure that no one is taking advantage of the American people for their own short-term gain," Obama said at a town-hall style meeting at a renewable energy plant in Reno, Nev.

The town hall was sandwiched in between Obama's four fundraising events in California on Thursday — one in San Francisco and three in Los Angeles. The president was holding six fundraisers over the course of his three-day West Coast trip, aimed at high-dollar donors and young people, both of whom will be integral to a campaign that could set fundraising records.

"This is going to just as hard, if not harder, than 2008," he said of his re-election bid during a small fundraiser at Sony Pictures Studios.

Probing traders and speculators
With the 2012 campaign in mind, the White House is anxious to show the public it's taking action to address rising gasoline prices. The national average price for a gallon of regular gasoline was $3.84 on Thursday, about 30 cents higher than a month ago and almost a dollar higher than a year ago.

Obama, decrying such levels as yet another hardship "at a time when things were already pretty tough," said Holder was forming the Financial Fraud Enforcement Working Group.

The task force will focus some of its investigation on "the role of traders and speculators" in the oil-price surge, Obama said, and will include several Cabinet department officials, federal regulators and the National Association of Attorneys General.

In Washington, Holder said he would press ahead with the investigation, even though he did not cite any current evidence of intentional manipulation of oil and gas prices or fraud.

"Based upon our work and research to date, it is evident that there are regional differences in gasoline prices, as well as differences in the statutory and other legal tools at the government's disposal," Holder said in a memo accompanying a statement announcing the task force. "It is also clear that there are lawful reasons for increases in gas prices, given supply and demand."

"Nonetheless, where consumers are harmed by unlawful conduct that has the effect of increasing gas prices, state and federal authorities will take swift action," Holder said.

He promised to "be vigilant in monitoring the oil and gas markets for any wrongdoing so that consumers can be confident they are not paying higher prices as a result of illegal activity."

There's not much Obama can do to affect the price of gasoline in short term, something he acknowledged in his remarks. Gas prices have risen steadily as a result of tensions in the Middle East and northern Africa and rising demand from China and other emerging economies.

Given that no evidence has yet surfaced of actual fraud or price manipulation in oil markets, Obama's remarks appeared, at least in part, as more of an attempt to assuage public anger over rising gas prices.

Other presidents have also launched similar inquiries at times of rising oil prices and widespread public suspicions of market manipulation by the oil industry or by speculators.

In an Associated Press-Gfk poll last month, 51 percent of adults said they thought recent increases in gas prices were due to "oil companies that want to boost profits" rather than changes in the global oil market. Nine percent said higher prices stemmed from a combination of both, 37 percent from changes in the market.

Obama renewed his proposal to end roughly $4 billion annually in various government subsidies to oil and gas companies "at a time when they're making record profits and you're paying near record prices at the pump. It has to stop."

Asked by a member of the audience about prospects for advancements in clean energy, Obama predicted that, with time, prices of now-expensive devices such as electric cars would come down.

"Having a flat-screen TV used to be a big deal," Obama said. But he said now such TVs are commonplace because prices have dropped so much.

While acknowledging he doesn't spend much time these days behind the wheel, Obama said, "I've been in one of these Chevy Volts. This is a nice car. It drives well."

He said when such vehicles become more affordable, "those of you out there driving that 8-mile-a-gallon SUV" should consider a purchase. Otherwise, by buying gasoline that likely came from imported oil, Americans "are putting money in the pockets of people who do not like us at all," he said.

Change 'tougher than expected'
Before the Reno event Thursday, Obama told supporters in San Francisco that he was pressing ahead with his agenda in a difficult political environment and that "change turned out to be a lot tougher than expected."

Obama addressed about 200 people who paid up to $35,800 apiece for the fundraiser at San Francisco's St. Regis Hotel, the first of four for the day.

Obama was interrupted by a small group among the paying guests who protested the detention of Bradley Manning, an Army private accused of leaking secret documents to the WikiLeaks website.

"We paid our dues, where's our change?" the protesters sang to the president.

"We'll vote for you in 2012, yes that's true. Look at the Republicans — what else can we do?"

Obama paused while security removed some of the protesters, then joked, "That's a nice song. You guys have much better voices than I do."

Manning, suspected of illegally passing U.S. government secrets to the WikiLeaks while serving as an Army intelligence analyst in Iraq, was transferred this week to an Army prison in Kansas from the Marine brig in Quantico, Virginia, where he has spent the last nine months.

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  • by US-First Location: Greenville on Apr 23, 2011 at 10:16 PM
    There is supply and there is demand. We control our demand (or we can if needed) but we do not control our supply (because we don't drill). There are also speculators. They bet that either the price will go up (because of low supply or high demand or both) or that it will go down (because of high supply or low demand or both). The invest heavily but risky on their guess. some win some lose but the effect can and does help move the price at the pumps. You can't blame them any more than you can blame other commodities investors. Some buy gold thinking the price will continue up and if enough buy it, it does go up. It also goes up if the dollar weakens. This is not rocket science people. You want to stabilize the oil market, drill it here. Quit letting the government invest your tax dollars in the drilling infrastructure of other countries w/o heavy compensation. Most of the middle east would still not know oil was under their feet or how to tap it with out us! Now look at what is happening in South America. Bozo helping them drill, practically giving away the technology.
  • by History Student Location: NC on Apr 22, 2011 at 08:46 PM
    WASHINGTON (AP) — It's the conspiracy theory that won't go away. And it's forcing Republican , Democrats and officials and presidential contenders to pick sides. Do they think Barack Obama was born outside the United States and disqualified to be president? Will Hillary Clinton finally get her question answered also? Was Obama born in the USA? Trump has the money to find the truth. Just wait Hillary
  • by Lester Location: NC on Apr 22, 2011 at 08:25 PM
    The community organizer comes. What Hussein is saying is “the Republicans want to allow producers to keep more of what they earn. - I " Hussein " want to take their earnings and dole, and give it out it to the moochers on welfare and food stamps to buy there vote.” It’s that simple. When it comes down to it, Obama really is a one-trick pony. His reason is to extort or rob hard workers and redistribute their income to non-producers. That is how he began his career. He was ACORNS - Attorney need history say more?
  • by Eric Location: Chocowinity on Apr 22, 2011 at 08:18 PM
    Gas is high because we're at war with the countries that produce it, and their neighbors, creating and contributing to instability in the region. We fund our side of the war with the taxes and theirs at the gas pump. It is also high because the environmentalists won't let us drill for oil in our own country. (I'm not at all convinced the BP incident was an accident... plenty of people with the means had plenty to gain from keeping us dependent on Middle Eastern oil.) If we did that, the Middle East wouldn't be able to gouge us on oil. And to the station owners, we're not spending less, we're spending more -- you're just giving us less for our money. :(
  • by ralph Location: ahoskie on Apr 22, 2011 at 06:39 PM
    Well, I hope the lesson you take away from this is to NEVER vote for any stinking traitor pig democrat, ever again, anywhere. OK?
  • by I need a new yacht, raise the price. on Apr 22, 2011 at 05:58 PM
    If I owned a oil refinery, I would raise prices every week as well. It's basic economics, the rate will increase until demand is less than production. There are two ways to acheive this, either you stop buying fuel or they price the product high enough that you stop buying it. The oil companies are pricing the fuel just to the edge to maximize profits and ensure there is still a demand for their product. High demand and low supply = High prices. Low demand and large supply = Low prices.
  • by High at the pump on Apr 22, 2011 at 05:43 PM
    You don't need a task force to see that gas is expensive. When the profits for the gas companies are in the billions, that means they are making a killing and they could reduce the price of fuel if they wanted to.
  • by Kathy Location: Greenville on Apr 22, 2011 at 05:39 PM
    It's a little late for Obama to be worrying about our money now isn't it?
  • by Anonymous on Apr 22, 2011 at 05:33 PM
    Is it Worth Drilling For More Domestic Oil? http://www.outsidethebeltway.com/is_it_worth_drilling_for_more_domestic_oil/
  • by jeff Location: carteret on Apr 22, 2011 at 04:09 PM
    Need to Arrest everyone of the wall street that drive up fuel prices. they are the ones who keep betting it to go up more & more & its a holding "out" game for all thats going up to make more money

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