WASHINGTON (AFP) — US Treasury Secretary Henry Paulson said Monday that surging world crude oil prices were a "problem" and welcomed a call by oil-rich Saudi Arabia for talks with energy-hungry consumer nations.
In an interview with the CNBC business television channel, the Treasury chief also expressed confidence in the long-term performance of the US economy and said he was looking forward to meetings with Chinese officials next week.
"There's no doubt that oil prices where they are is a problem. There's nothing welcome about it, it's a real headwind. We're focused on it," Paulson said.
The Treasury secretary said a giant 168-billion-dollar economic stimulus should help Americans offset rising fuel bills amid lackluster economic growth which is being buffeted by a persistent housing downturn and a related credit squeeze.
Paulson spoke after Saudi Arabia called for talks with consumer nations on soaring world prices and reiterated its readiness to meet any increase in demand as a key oil-producing nation.
A key New York oil futures contract rocketed by over 10 dollars on Friday after soaring to a record high of 139.12 dollars per barrel in intraday trading. The contract had fallen two dollars to 136.54 dollars Monday.
Asked about the Saudi call, Paulson replied: "It's got to be constructive. So I welcome it. I think that the solutions to the big problem are longer-term solutions in terms of investing in supply and alternative sources of energy."
The Treasury chief also parried questions about the ailing US dollar, which has tumbled in value dramatically in the past year.
"Our economy may have its ups and downs, but that looked at over any reasonable period of time our long-term fundamentals compare quite favorably with other major industrial nations around the world and that's going to be reflected in the price, the value of our currency," he said.
The dollar had rebounded somewhat Monday afternoon after dipping against the euro further late last week and was trading at 1.5645 dollars in afternoon New York trading.
Asked about a possible currency intervention to help prop up the dollar, Paulson said: "I would never take intervention off the table or any policy tool off the table. I just can't speculate about what we will or won't do."
The Treasury chief was also quizzed about a meeting of top US and Chinese economic policymakers next week near Washington.
"One of the big focuses is going to be this 10-year energy framework, we're working on a plan, the US and China, focused on energy security, energy efficiency and environmental issues," Paulson added.
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