White House, Aiming to Cut Prices, Presses World Oil Producers to Raise Output

The Clinton administration is trying to persuade world oil producers to put more oil on the market and is studying whether emergency U.S. stocks could or should be tapped to drive down prices, a top White House official said Sunday.

Ideally, “the market ought to set the price, but we’re taking a look at what options we have under the authorities and under the laws of the United States,” said John Podesta, the president’s chief of staff.

He was asked on “Fox News Sunday” about whether the administration would dip into the Strategic Petroleum Reserve to force down the price from its current level of close to $30 a barrel. Energy Secretary Bill Richardson said repeatedly last week that he does not intend to do that.

Podesta said Richardson’s contacts with oil ministers of producing countries--he has visited several and plans visits to Saudi Arabia, Venezuela and Mexico--are a major part of the administration’s effort to bring down prices.

Ministers of the Organization of Petroleum Exporting Countries are meeting next month to consider whether to extend a production hold-down of 5 million barrels a day, which began in 1998 and expires March 31.

President Clinton released $45 million last week to help low-income people in the frigid Northeast with their heating bills. Podesta said that in addition to such stopgap measures, “we’re also trying to see what we can do to see if we can take some of the pressure off of oil prices” through raising market supplies.

The reserve, first proposed during World War II, was established in 1975. Its only use so far was a partial drawdown in 1991 at the beginning of the Persian Gulf War. That move by President Bush, along with production increases internationally, maintained market stability and kept oil price increases down during the six-week war.

In other developments, Podesta said the president, despite his support for the death penalty, has asked advisors to research whether it should be suspended for federal crimes, as Gov. George Ryan did in Illinois. Ryan acted because of misgivings about the Illinois justice system, which has seen more death row inmates exonerated and freed since 1987 than have been executed since 1976.