Gordon Brown has warned that high oil prices are here to stay as Downing Street played down speculation over a U-turn on road and fuel taxes.
The Prime Minister said that while he wanted to help the "hardest hit" families, the problem of global demand outstripping supply was "long-term".
"Of course in the current situation we are trying to do things that will help those families who are hardest hit," Mr Brown said. "This is not just a national problem. It is a global problem of supply and demand, not just in the short term but the medium term and the long term."
The comments, at a meeting with industry leaders in Scotland, came as the Government unveiled moves to boost North Sea oil production by up to 70,000 barrels a day.
Business Secretary John Hutton said it was vital Britain made maximum use of its resources to ease pressure on the economy.
However, there was still confusion over how ministers would respond to anger among the public and Labour backbenchers over the planned rises in road and fuel taxes.
In the wake of strong hints from Cabinet ministers on Tuesday, Number 10 played down suggestions there could be a U-turn over the 2p hike in fuel duty and controversial reforms to road tax.
"Of course we understand the concerns consumers face, but we also need to take into account the need to ensure economic stability, to fund public services and to promote energy efficiency," the Prime Minister's spokesman said.
"All that John Hutton and Jack Straw were saying yesterday was nothing more than of course the Government understands the concerns that consumers face."
