Obama to ramp up U.S. oil production

WASHINGTON -- Amid growing public unhappiness over gas prices, President Barack Obama is directing his administration to ramp up U.S. oil production by extending existing leases in the Gulf of Mexico and off Alaska's coast and holding more frequent lease sales in a federal petroleum reserve in Alaska. But the moves won't calm spiraling prices at the pump anytime soon.

Obama said Saturday that the measures made "good sense" and would help reduce U.S. consumption of imported oil in the long term. But he acknowledged anew that they wouldn't help to immediately bring down gasoline prices topping $4 a gallon in many parts of the country. An oil industry analyst agreed.

"There is practically nothing that Washington can do that would materially change the price of fuel in this country," said Raymond James analyst Pavel Molchanov, noting that the United States produces about 5 percent of the world's petroleum while consuming about 20 percent. "Given that imbalance, there is simply no policy shift that could plausibly come from the federal government that can significantly change that dynamic."

An oil industry group praised Obama's move as a first step with a "couple of positive nuggets" but contended that more was needed to boost oil production. Erik Milito, upstream director for the American Petroleum Institute, in a statement called for more access to key shale reserves and construction of a pipeline that would import crude from Canadian oil sands.

Sen. Robert Menendez (D-N.J.), who is opposed to drilling off the Atlantic coast, expressed concern about possible dangers to the environment. "I think it is disappointing he would pursue a strategy that comes with considerable risk while offering no hope of driving down gas prices," Menendez said in a statement.