[ASSURAS] Whether it's Middle East instability fueled by Libya's civil strife or speculators projecting coming crises, gas prices are surging. In fact, the Energy Department this week predicted an average $3.70 at the pump this summer. Some scoff at that "low" number. No one really knows, but the pressing question is, is it time to hit the emergency button? This week, the president's chief of staff, William Daley, said that all options are on the table, including siphoning from the Strategic Petroleum Reserves, our emergency stockpile of more than 700 million barrels of oil. Hurricane Katrina in 2005 was the last time that happened.

Dipping into the stockpiles -- is it a knee-jerk political reaction or keeping the economy from dipping back into the tank? Joining us to talk about it on theMIX are two "energyNOW!" contributors, Tyson Slocum, policy director from the consumer advocacy group Public Citizen, and Daniel Weiss, a senior fellow with the left-leaning think tank Center for American Progress. Gentlemen, thanks for being here. Let's jump right into this. Is this an emergency situation? The president can dip into the reserves. Is it time to do it, Dan?

[WEISS] It is getting there. We believe that the president ought to take a small portion of oil from our full reserves, when either oil hits $125 a barrel or gasoline hits $4.00 a gallon. Those prices are going to inflict real pain on middle- and low-income American families. And in past selling of our reserve oil, it has effectively reduced the price. You know, our economic recovery is still in its shoots, and this high oil prices could smother that growth before it has a chance to flower.

[ASSURAS] Tyson, take that on.

[SLOCUM] I'm going to respectfully disagree. I think the fact is that we're not in a supply/demand crunch. We've got record levels of commercial inventories. We've got more than a billion barrels of crude oil and refined products in storage. Combine that with the 726 million barrels of oil in the Strategic Petroleum Reserve and we've got 1.8 billion barrels of product in the United States. There are not physical shortages around the globe. The Saudis are able to come in and step in for the shortage of Libyan exports. But the president ought to be talking about the real solutions, in the short term, that are going to get us there, which is, addressing the role that speculation has in hyping up this market, because there's no question that's we're overpaying.

[ASSURAS] You're saying, "Government, jump in," too.

[WEISS] Tyson, if you want to go after speculators, the best way to burst the speculative bubble is for the government to say, "Fine, we're going to put some oil on the market, which will create uncertainty and undo the expectation that the oil price is going to continue to rise as instability in the Middle East increases," which could, unfortunately or not, affect Iran, Saudi Arabia, and other much larger producers than Libya or Egypt. And so it's one way -- If you read -- analysts have been saying this price hike is due to fear, psychology. One way to address that is taking a big chunk of oil, putting it in the market, once we reach that certain threshold.

[ASSURAS] Tyson, is it the government's job to act here, to jump into the market?

[SLOCUM] Not in this case, because throwing this excess crude into an already over-supplied market, I don't think, is going to bring prices down.

[ASSURAS] But if the crisis increases to $4.00, for example?

[SLOCUM] Only if there's an actual supply shortage. If we see unrest move into Riyadh, Saudi Arabia, that would really threaten global supplies, then yes, but the fact is, right now, Americans are overpaying the risk premium because some Wall Street investment banks are using the crisis in Africa and the Middle East to drive up prices far beyond what the experts believe the real risk is.

[WEISS] Right, which is why we should burst that speculative bubble by putting oil in the market.

[ASSURAS] Speculators, who are they?

[SLOCUM] Well, the CFTC data clearly shows that the net long positions in crude oil markets by noncommercial traders -- which are the big investment banks on Wall Street and the index funds that they operate that bring in pension money -- they're the ones that are driving this price up. There's no question that speculators have to play a role in the market. I don't want to see speculators driving the market the way they're doing now, because they are forcing us to way overpay this risk premium and it's really going to start to hurt the economy.

[ASSURAS] Let me ask this question -- don't these high prices help the big oil and its allies say, "Let's start drilling in Alaska"? At the same time, don't they help the administration, for example, to say to folks, "Don't stay in your cars. Use public transportation because of high prices"? The Energy Secretary has already said the market will take care of the prices. We need to move to biofuels.

[WEISS] In 2008, when oil prices skyrocketed, oil consumption dropped only about 3%. And the reason for that is because it's not a very price-sensitive product. What happens is that middle- and low-income families take more out of their wallet and give it to big oil and have less for other things.

[ASSURAS] I do have one question to ask you, to end this -- What got your blood boiling this week? Dan -- other than this.

[WEISS] What got my blood boiling this week is that the House Republican budget, that passed, would actually make us more dependent on foreign oil by cutting money for research into advanced batteries for cars, by cutting money for transit, by cutting money for assistance to domestic auto manufacturers to build cleaner cars. At a time when oil prices are rising and it's hurting middle- and low-income Americans, they're cutting money that would help us reduce our oil use and reduce the impact of these volatile prices.

[ASSURAS] Tyson?

[SLOCUM] What got my blood boiling is the embarrassing flipflop by Fred Upton, the chairman of the House Energy and Commerce Committee. He, in the past, has clearly articulated that the science behind climate change is real, that it's manmade, and that we have to aggressively go after it, and now that his party has swept into power, he is bowing to a very radical fringe within the party, and it's an embarrassment. It's an embarrassment to the country and to him -- he's a lot smarter than this.

[ASSURAS] I think your blood is boiling. Gentlemen, thanks. We'll be talking again. You'll keep talking.

[WEISS] Thank you, Thalia.