March 30 (Bloomberg) -- Massachusetts Senator John Kerry, the Democratic candidate for U.S president, said the U.S. must put more pressure oil-producing nations and stop filling the nation's strategic reserves to check rising gas prices.

He also called for simplifying regulations on gasoline production and boosting reliance on renewable energy sources. The speech came as President George W. Bush's campaign released a new television advertisement that says Kerry has favored higher gas taxes during his 19 years in the Senate.

``The United States of America can't drill its way out of the problem,'' Kerry said at a rally on the campus of the University of California, San Diego.

Gas prices are becoming an economic and political issue in the U.S. seven months before Kerry, 60, and Bush, 57, face each other in the general election. The average retail price for gasoline reached a record $1.758 a gallon, the Energy Department said yesterday, and exceeded $2 a gallon in California, the most populous U.S. state.

Bush addressed the issue today in a speech on the economy in Appleton, Wisconsin. Without mentioning Kerry by name, the president said he opposed higher taxes on gasoline.

``There are some in the other party that would like to raise gas taxes,'' Bush said. ``I think it'd be damaging to the economy.''

OPEC Action

The 11 members of the Organization of Petroleum Exporting Countries meet tomorrow in Vienna to review a Feb. 10 accord to reduce quotas by 1 million barrels starting in April to 23.5 million barrels a day. OPEC nations accounted for about 40 percent of U.S. oil imports in 2002, according to Department of Energy figures.

Crude oil for May delivery was up 94 cents, or 2.7 percent, at $36.39 a barrel at 11:19 a.m. on the New York Mercantile Exchange, 17 percent higher than a year ago.

The Bush campaign released its latest television ad, which accuses Kerry of favoring a 50-cent boost in the federal gas tax and voting for higher gasoline taxes 11 times in the Senate.

``There's a philosophy here and a consistent record'' of support or record of votes in favor of higher energy prices, Ken Mehlman, the Bush campaign manager said in a conference call with reporters.

Campaign Ads

The ads highlight remarks Kerry made March 1, 1994, to the Boston Globe in which he said he favored a 50-cent per gallon tax increase on gasoline. Kerry didn't offer legislation to increase the tax.

``Some people have wacky ideas,'' the narration of the ad begins. ``Like taxing gasoline more so people drive less. That's John Kerry.''

In his speech, Kerry said Bush has failed to act as gas prices reach an all-time high, costing the typical U.S. family $289 more per year at the same time they are being hit with higher costs for tuition, health care and state and local taxes.

Kerry said he would exert pressure on OPEC to increase oil supplies and suspend oil purchases for the U.S. 700 million barrel Strategic Petroleum Reserve, located in deep salt caverns off the coast of Texas and Louisiana. He previously has advocated putting more emphasis on renewable energy sources to reduce the country's dependence on foreign oil.

`Discussions' With Producers

The White House said is addressing the higher cost of oil.

``We continue to engage in ongoing discussions with major producers around the world,'' Bush's press secretary, Scott McClellan, said today in Washington.

Energy Secretary Spencer Abraham said last week that a study by the Energy Information Administration, a non-partisan government agency, concluded that the impact of the government purchases for the reserve on supplies is ``negligible.''

Mehlman said that shortly after taking office Bush proposed energy legislation that is designed to offer incentives to make more energy available.

It includes opening more U.S. land to oil and natural gas drilling, including a wildlife refuge in Arctic Alaska, as well as promoting conservation and renewable resources. The legislation has been held up in the Senate by objections from Democrats, including Kerry, to allowing drilling in the Arctic National Wildlife Refuge.

Bush and Kerry are engaged in a close battle for support of voters. A poll conducted for USA Today and Cable News Network conducted March 26-28 shows 51 percent of 1,001 adults surveyed said they would likely vote for Bush and 47 percent said Kerry.

In a survey taken March 5-7, after Kerry emerged as the Democratic nominee by winning all but three party primaries and caucuses, Kerry led Bush 52 percent to 44 percent, according to poll data published by USA Today. The survey has an error margin of plus or minus 3 percentage points.

To contact the reporter on this story: William Roberts in San Francisco at wroberts@bloomberg.net

Last Updated: March 30, 2004 14:22 EST