Obama feeling the heat from oil producers

Gas hits new high as president kicks off energy tour

This is a rush transcript from "Your World," March 21, 2012. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST OF "YOUR WORLD": Gas up another two cents and now the president of the United States set to give his 2 cents.

Welcome, everyone. I'm Neil Cavuto.

Four states, two days and it all starts in 20 minutes, the president's first stop, Boulder City, Nevada, where he will visit a solar plant, and then it's on to New Mexico later today, Oklahoma and Ohio tomorrow. He's expected to push for an all of the above approach to energy, solar, wind, natural gas, and indeed drilling.

But on a day when gas prices are hitting new highs this year, growing questions the president is not doing enough or responding to the heat, and not just from fed-up drivers, from oil producers blasting his planned stop in Oklahoma tomorrow to tout his support for part, only part, of the Keystone pipeline.

Mickey Thompson is one of the energy producers. The president and the owner of a Paragon Energy Partners joins me right now.

You are not a fan of the president coming to your neck of the woods and he says he is open to drilling and the southern part of the Keystone pipeline. So I don’t think he understands why you are complaining.

MICKEY THOMPSON, PRESIDENT, PARAGON ENERGY PARTNERS: Well, we are not complaining per se about his new position on the pipeline.

We think there is a glut of oil at Cushing, and it does hurt our price. And we would like to see the oil out of there. So the idea is his expediting the southern leg of the pipeline, we are good with that.

(CROSSTALK)

CAVUTO: Here is what I don’t understand. How can you be good with expediting a part of the pipeline that might be championed here, but you need to be getting the oil from Canada and that part is not connected, so, you -- I guess you have a pipeline to nowhere.

THOMPSON: I don’t own any oil in Canada or even in North Dakota.

My production is in Oklahoma. I'm interested in getting my production to market where I get the best price.

CAVUTO: Gotcha.

THOMPSON: This leg of the pipeline is a good thing. We are not; -- Oklahoma producers were upset when he decided not to do the whole project.

We still are hopeful the whole project will get done. But the reason that we are saying, Mr. President, this dog won't hunt has nothing really to do per se with the pipeline.

CAVUTO: The reason why, I talked to many of your colleagues in the industry who have been saying whether we have operations in this neck of the woods or not, eventually this pipeline is supposed to connect to Canada. It is supposed to make it easier to get more oil, so that we can all enjoy it. That is why I mentioned it.

But having said that, the president is trying to say, clearly, that with this four-state tour, I’m on top of all options including drilling and I am open to that.

You have your doubts about the drilling part. Why?

THOMPSON: This is a president who spent three-and-a-half years going around the country telling everyone that will listen that oil is the fuel of the past. And now he wants to come to Oklahoma in the heart of the oil patch and stand in Cushing, Oklahoma, or near Cushing, Oklahoma, the largest crude oil storage in the country, and suddenly act like, you know, his administration has done something to increase domestic production.

And that is just a falsehood. And, you know, my friends and my colleagues in the oil industry, the word I hear most often is insulting. We in the oil and gas business are insulted by the insinuation this president is for the oil industry in America.

CAVUTO: When he talks about taking away subsidies and benefits the oil industry has been using to explore, that sort of thing, many Americans when polled support that effort because I guess it is kind of easy to vilify guys like you, Mickey, even though you seem like a nice chap personally to talk to, but it has become popular to rip oil guys.

Does that bother you?

THOMPSON: Well, no American in this time in particular likes to think about subsidies.

The fact of the matter is the tax provisions that we are talking about if they go away will decrease drilling 35 percent or 40 percent. And what that will do is decrease production by a similar amount. And we decrease production, we will decrease the amount of oil, decrease the amount of gasoline available, and you know what will happen to the price of gasoline? It will go straight up.

So, you know, this is code for higher gasoline prices. And I guess the most disgusting part about this as far as what we are doing tomorrow in Oklahoma is that the president is going to talk about how he helped increase oil production, which is a fallacy. It is exactly the opposite, frankly, but also the fact that this is code for higher gasoline prices, which is what this administration has been all about since the very beginning.

Secretary Chu said in 2008 and 2009 -- and I realize he is now recanting now under the political glare of the prices -- but they have been all about higher gasoline prices so that their agenda toward alternative fuels and renewable energy looks better and has more success.

The American people need to know that, really, this is code for higher gasoline prices.

CAVUTO: Well, it is interesting because they do keep going higher.

Mickey, thank you very, very much. Good talking to you.

THOMPSON: Thanks, Neil.

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