This is a rush transcript from "Your World with Neil Cavuto," July 18, 2008. This copy may not be in its final form and may be updated.

CHERYL CASONE, GUEST HOST: With crude prices dropping, is this any time right now to be tapping into America's emergency oil supplies? Democrats on Capitol Hill pushing for that again today. House Speaker Nancy Pelosi wants to drain 10 percent from the nation's stockpile.

And so does a Democratic Congressman Bill Pascrell of New Jersey. And he joins us now.

Congressman, thanks for being here.

REP. BILL PASCRELL JR. D-N.J.: Cheryl, how are you today?

CASONE: I am good.

I have to ask you, in the wake of a drop in crude this week, down $15 — $16 — excuse me — with today's close, how can you still say that we should be tapping into the SPR?

PASCRELL:: Well, I think that the bubble has burst. And while oil is $129 and has held for two days, that does not mean we do not have a problem. The gap between supply and demand is still very narrow.

And I support what the speaker has recommended and what many have talked about. The reserve is 98 percent full, the Strategic Reserve, that is. And I believe that two presidents, both Clinton and the first Bush, went into it when we had to, and prices were reduced 30 percent.

CASONE: But we don't have to right now.

PASCRELL:: We want immediate reduction in price at the pump.

(CROSSTALK)

CASONE: Why do we have to go into it right now? You had oil drops $16 this week.

PASCRELL:: Because it's the only way we can drop the price right now. We can go after speculators. We can do somersaults. The only way we're going to get the price down right now is to use the...

(CROSSTALK)

CASONE: Congressman, gas prices are going to go down.

PASCRELL:: Well, I am glad you predicted it, because the folks didn't predict where it would be just six months ago. So...

CASONE: It is a free market system, and it is working. And it is going to work in the favor of American drivers.

PASCRELL:: No, no, it is not a free market system when speculators, who have nothing to do with the oil business, go into the commodities market and drive up the price. We know that. We have 706 millions of barrels. That is 98 percent of what the — it has never been full, never been more oil in there.

(CROSSTALK)

CASONE: Congressman, you have got a storm brewing off of the coast of Aruba right now. That could hit the Gulf of Mexico in the next few days. That is what we need the reserve for.

PASCRELL:: You want to make an — we have a strategic problem right now. We have an emergency situation, because the price of fuel is affecting every product, basically, on the market that has to be moved.

CASONE: I am well aware of that. But I am saying that. That is why we have been SPR. And, remember, we were at war when the first President Bush went into it.

(CROSSTALK)

PASCRELL:: Do you support an immediate reduction in gasoline prices?

CASONE: That is not here nor there. Everybody that is driving a car wants gas prices to go down.

PASCRELL:: That's what the Republicans were talking about for the last two-and-a-half months.

And, so, instead of drilling, in fact, the bill that we introduced yesterday, we did not get two-thirds as a suspension bill, so we are going to bring it back again next week, of use it or lose it. There is all of this acreage out there that can be drilled. There is no impediment whatsoever.

CASONE: And we can drill offshore. And President Bush said this we need to drill offshore. He lifted the ban. Congress has to act now.

(CROSSTALK)

PASCRELL:: Excuse me.

Look, do not read off of the script book to me, please. There is plenty of land offshore and onshore, the land I am talking about, the 700 - - there is plenty of land. The 68 million acres, they are there.

(CROSSTALK)

CASONE: That bill got voted down yesterday. And let me remind you, and let me remind you, sir, that you want to criminalize OPEC? You have voted in the past to criminalize OPEC?

PASCRELL:: Well, let me tell you something. One of the bills we introduced is to go after those countries who play us like a fiddle. Yes, there should be punishment for those countries.

(CROSSTALK)

CASONE: OK. So, you want to criminalize OPEC, but we cannot drill at home? We need oil.

(CROSSTALK)

PASCRELL:: This is — more important than the price of gasoline at the pump is our strategic place in the world. This is a situation which jeopardizes Homeland Security, if we have to depend on these volatile countries for our oil. We are importing too much as it is.

(CROSSTALK)

CASONE: We can go get the oil right here at home. We got it.

PASCRELL:: And I accept the fact and many on my side of the aisle and on the other side of the aisle accept the fact that we can drill on the lands that have already been designated, that have ever been environmentally acceptable. We can do it now.

And it is proven, because, if we drill in those specific areas that have been proposed, we will not reduce the gasoline right now.

(CROSSTALK)

CASONE: That is not cost-effective. And you know that, sir.

PASCRELL:: It is cost-effective.

CASONE: How?

PASCRELL:: It is cost-effective. In fact, you cannot blame the Congress that the oil companies have not build new refineries. You cannot blame the Congress that the oil companies have not gone into the lands that have already been designated for them to drill. This is a hoax.

CASONE: We also need new refineries. You don't want us to build — can I come build a refinery in your backyard? Because we certainly need one in this country right now.

(CROSSTALK)

PASCRELL:: Congress isn't going to build the refineries. The oil companies have to build the refineries. You are not suggesting otherwise, are you?

(CROSSTALK)

CASONE: Well, they keep getting shot down. We have not had a new refinery built in 30 years in America.

(CROSSTALK)

PASCRELL:: Excuse me. Who is shooting down the oil companies in building refineries?

We have half the refineries we had 30 years ago. Why? The Congress did not do anything about that. You cannot blame the Congress, Democrats or Republicans. The oil companies want it all their way. They are not going to get it on their way anymore.

CASONE: You yourself are on the record, though, as voting that there should be no new refineries built in this country. It's been 30 years.

PASCRELL:: Well, the fact is, we need refineries. We have got to bring that crude and get it through to the market. There is no question about that, Cheryl. I am not disagreeing with you. You do not expect the Congress to build the refineries.

CASONE: Maybe the oil bucket bird can come in and fly some oil, and that will help gas prices. But I think they are going to go down. They are going to go down, $16 on crude this week.

(CROSSTALK)

PASCRELL:: I like fantasy, but that is beyond fantasy.

CASONE: Well, I think you might be out there as well.

All right, well, Representative Bill Pascrell, we appreciate this, certainly.

PASCRELL:: Pleasure to talk to you, Cheryl.

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