This is a partial transcript from "Your World with Neil Cavuto," May 18, 2004, that was edited for clarity.

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NEIL CAVUTO, HOST: What a pain in the gas! Welcome, everybody. I'm Neil Cavuto, and this is Your World.

And the experts keep saying gas prices can't get much higher, but in scores of states they do, and they go a lot higher. Three bucks a gallon likely. Now talk of $4 a gallon possibly. Overwhelmed and overwrought, enter a top U.S. senator to say, over, period. It's time to tap our emergency reserves and now.

Joining us is Democratic Senator Jon Corzine (search) of New Jersey.

Senator, good to have you.

SEN. JON CORZINE (D), NEW JERSEY: Neil, good to be here.

CAVUTO: Why is now the time?

CORZINE: Well, I think this is a pretty simple proposition. Supply and demand determine prices. I think that taking about 5 percent of the strategic oil reserve and putting it on the market, as opposed to buying up oil at these prices and putting it into the reserve, is a way to increase the supply for the private markets. And I think it will actually have a major psychological impact on markets going forward, and it will have a real difference in how we set the price just because there is greater supply there.

CAVUTO: Senator, I know a lot of people are hurting right now, but they could be hurting a lot more in the event of a supply disruption. Shouldn't we save those reserves for a moment like that than a moment like this?

CORZINE: Well, Neil, I think that, you know, it is a matter of proportionality. We're talking about a million barrels a day for 30 days. I think it will have major psychological impact. As I said, it is about 5 percent of the total oil reserve, which is about 95 percent full right now.

I think this is not the time that you should be out on the market chasing this -- the limited supply that we are seeing. I think there are other things we ought to be doing, too, that may be more important. I think the president ought to do what he told President Clinton to do when he was running for president, is he ought to get into the jaw-boning action very strongly with regard to the Saudis and other OPEC (search) countries, and start increasing that flow of supply into the international markets.

CAVUTO: But what if the problem isn't entirely the cost of oil itself, but the taxes on that oil, the taxes on the gasoline for states such as yours and mine, New Jersey? That is a huge chunk...

CORZINE: New Jersey actually has the lowest in the nation.

CAVUTO: But across the country it is a huge issue. It might not be as big an issue for you in New Jersey, but the fact of the matter is, for a lot of folks that's the problem. So if you do relate to these folks, Senator, why not advocate cutting all the gas taxes?

CORZINE: Well, I don't think that does much with the supply conditions. And if there is a restriction on the flow of oil, that will be made up very quickly.

You know, by the way, with no major changes in oil taxes, we have seen a 42-cent rise in the average cost of a gallon of gasoline this year. Each cent of that is a $1 billion tax on the American public. And actually, that $42 billion translates into about $1,000 worth of expense for the individual American family. And I can't...

CAVUTO: But, senator, let me ask you this, in all seriousness, now when we had the run-up in oil prices the last go around, and they got up to $1.50 a gallon, many of your colleagues in the Senate were saying open up the reserves. You know, if you opened it up then, it would have been a one-shot wonder, we would have still been in the same pickle we are in. Is this really just offering Americans a nicotine fix?

CORZINE: Actually, Neil, there is twice in the last 15 years. Once during the first Gulf War (search), where they tapped into the strategic reserve. We saw a 15-cent decline in oil prices in the first two weeks. They did it again in 2000, and we saw even a larger decline in the price of gasoline. This is one of those things that actually impacts the psychology of the market actually more than it actually changes the terms and conditions...

CAVUTO: How do you know that? How do you know that? How do you know it is not a one-shot wonder? You go ahead, open up the spigot a little bit, Senator, and then ... pay again.

CORZINE: You look at history and has it been a successful means of leaning against the wind of a spike in a market. I think that is the case. I saw where ... who is probably the foremost expert with regard to petroleum issues across the globe, says there is about a $6 to $8 premium, geopolitical risk premium involved in oil right now.

What we need to do is take a countervailing step that leans against that. I think this is one of those ways to do it.

CAVUTO: Senator, always enjoy having you on. Thank you very much.

CORZINE: Good to be here, Neil.

CAVUTO: Senator Jon Corzine on Capitol Hill.

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