Lugar, R-Ind., aid tight oil markets are creating a tough economic climate at the gasoline pump for average Americans.
The U.S. Energy Information Administration reported Monday that retail prices for regular unleaded gasoline averaged $3.83 per gallon, up more than 26 cents from the same time last year.
Lugar said part of the reason for higher oil prices is because U.S. President Barack Obama is blocking the permit for the planned Keystone XL pipeline.
"President Obama has personally lobbied against our bill to approve the Keystone XL pipeline, even as he places restrictions on new lease sales and permits for domestic oil production," he said. "That is a formula for long-term oil vulnerability."
By a vote of 56-42, the Senate last week rejected Republican-backed legislation that included provisions for the Keystone XL pipeline in a transportation bill, the latest effort to force the hand of the White House on the pipeline.
White House spokesman Jay Carney said Obama "made some calls" to Senate leaders before the vote.
TransCanada, the company behind Keystone XL, has said it plans build a U.S. leg of the pipeline from Cushing, Okla., to the southern Texas coast. It needs U.S. federal approval for the project, however, because Keystone XL would cross the U.S.-Canadian border.