Gas prices going up means additional challenge for Obama bid

Gas prices still going up, may hit $4 a gallon

Gas prices continue to rise, reaching $3.39 this week. Crude oil prices breached the $100 per barrel level on the world market this Wednesday.

The ongoing turmoil in Libya and the rest of the Middle East, coupled with the spike in global demand for oil, can push gas prices higher to as much as $4 per gallon this summer.

This development is proving to be a real threat to President Barack Obama's re-election bid and Republicans are expected to take advantage of the situation to foil Obama's plan.

Skyrocketing fuel prices are being considered "a threat" to the economic rebound by Federal Reserve chairman Ben S. Bernanke, although he thinks it will not probably become so bad as to result to runaway inflation.

Rising gas prices significantly reduced the popularity of former presidents Jimmy Carter and George W. Bush while they were in office.

The administration meanwhile remains mindful but unfazed about the worsening trend. President Barack Obama "is extremely aware of the impact a spike in oil prices can have on gasoline prices and therefore on the wallets and pocketbooks of average Americans," said Press Secretary Jay Carney on Wednesday.

He added that the White House remains "confident that the global system has the capacity to deal with major disruptions in oil supply."

Libya's oil production has been drastically reduced because of the conflict there. Saudi Arabia said it is willing to increase oil production to cover up the supply imbalance. But rumblings of unrest in the oil-rich kingdom itself adds to the uncertainty about the global oil market.

Some in the U.S. have pushed for the opening of the Strategic Petroleum Reserve to soften the impact of gas prices going up.

Posted by Sophia Andrews on Monday March 07 2011, 4:36 AM EST. Ref: LA Times. All trademarks acknowledged. Filed under Featured News, Health. Comments and Trackbacks closed. Follow responses: RSS 2.0