This is a rush transcript from "On the Record," February 27, 2012. This copy may not be in its final form and may be updated.
GRETA VAN SUSTEREN, FOX NEWS HOST: Well, if you put gas in your car this weekend, you know that gas prices just got even higher. And here's even worse news. It's going to get worse, much worse. Drivers in several states already paying more than $4 per gallon, and analysts say the national average will hit $4.25 a gallon in just 30 days.
Some Democratic members of Congress say it is time that President Obama do something, and that something is to tap into the Strategic Oil Petroleum Reserve. But will that really help lower gas prices?
Congressman Peter Welch says yes. Still, there is disagreement even within the Democratic Party. Congressman Welch joins us. Good evening, sir.
REP. PETER WELCH, D-VT.: Good evening.
VAN SUSTEREN: You have written the president and asking him to tap in. Why?
WELCH: Well, two things. One is this is -- this is a tool. The Strategic Petroleum Reserve has 700 million barrels of petroleum. And two -- four presidents, both President Bushes, President Clinton and President Obama, used this before and gas prices came down between 8 percent and 33 percent. So it's a tool.
Second, it's a tool that can be very effective when speculation, as opposed to supply, is a major problem. And anytime there's a lot of uncertainty, as there was with Libya and now there is with Iran, the futures market, the speculators, make a killing.
And what happens with the release of some of the Strategic Petroleum Reserve is that it's a shot across the bow to the speculators and it lets them know that the administration is going to be on the side of the average person pulling up to the pump and try to bring their price down.
So this is a tool that we can use. It's not an answer to a long-term energy strategy. But when speculation is driving up the cost, as Goldman Sachs says, about $27 per barrel, and Bart Chilton of the Commodity Future Trading Commission says about 15 bucks on every time you fill up your tank, you can make a difference with that.
VAN SUSTEREN: All right, it is speculation that's driving it up, but there's also increased demand. You've got China and India, which has an unbelievable appetite and is driving up it, as well.
I'm curious that -- you know, is -- a couple things. One is, how much do you want to tap into the 700 million? That's the first thing. Secondly, how long do you think that it'll have an impact? Because that's a short-term solution. And thirdly, how are we -- when are we going to fill it back up?
WELCH: Well, number one, you are right. As the economy starts to get a little bit stronger and as we get increasing demand from China and India and other countries, that obviously is going to have a supply-demand impact on the price. And that's where what Senator Thune was talking about is a legitimate issue because you've got to have a long-term strategy to deal with that.
There's lots of opportunities in this country to generate more energy. Natural gas, obviously, is something that can be part of the long-term future.
But second, when you do have speculation and there's tools that allow you to take immediate action that is going to be short-term, but put some brakes on the speculators -- have them lose money instead of make money -- why not do it? I mean, that's what previous presidents have done, Republican and Democratic. It is short term, and you'd have to leave the management of that to the executive. And as I say...
VAN SUSTEREN: But...
WELCH: Go ahead.
VAN SUSTEREN: I was going to say in terms of speculation, I mean, I think we're still going to have speculation out there because we have these wild cards. We have the Sudan, Nigeria and Iran in the immediate. And it is bipartisan. Presidents on both sides have done this to deal with short- term problems.
I'm curious, why hasn't President Obama done this? Has he responded to your letter and said that he might do that? What's the response you're getting?
WELCH: There's a debate about whether you should use the Strategic Petroleum Reserve only in almost cases of war. People are very restrained about holding back. My view is that we ought to be more liberal and see if something that can help the average person in this country who is getting hammered by the cost of gas when they go to the pump.
I mean, this is -- as you know, others have said, this is like a tax. And this is a real threat to the short-term economy. People don't have the ability to deal with the speculation premium that they have to pay.
So we ought to step in, one, by using this tool, the strategic petroleum reserve, on a short term basis, see how it works. And number two, I think we really have to crack down on speculation in the futures market. We ought to be much more aggressive about making it tough on the speculators, basically, to make money because of the pain and the uncertainty that is occurring in other parts of the globe.
VAN SUSTEREN: And I -- and there is that big picture issue. It's not just putting the gas in the tank, is that when gas prices go up and over a prolonged period of time, it is a drag on the economy and hits us in...
WELCH: That's right.
VAN SUSTEREN: You know, food prices go up, everything goes up. So it's a little more than just your gas tank when you sort of step back and look at it.
WELCH: That's right. And we have a common interest. You know, there's a fierce debate, as you know, between Republicans and Democrats about what's our long-term energy future. But bottom line, we all represent Republicans and Democrats who are getting hammered at the pump.
And if there is a step that we can take that is short term and immediate and provides some benefit, and where history has shown that the president releasing from the Strategic Petroleum Reserve has brought gas prices down 8 percent to 33 percent, why not use it? Why not give the American consumer a bit of a break?
VAN SUSTEREN: Well, we'll be watching to see what the president does and to hear what the other side of the discussion is. Congressman, thank you, sir. Nice to talk to you.
WELCH: Yes. Thank you.