Natural Gas Prices Deemed Threat to U.S.

A Dow Chemical executive told Congress last week that Hurricanes Katrina and Rita illustrate that the nation’s tight natural gas market continues to contribute to extremely high and volatile prices and poses a significant threat to the global competitiveness of the U.S. chemical industry. While the disruption caused by the hurricanes will be short-term, “a far greater threat to the chemical industry is the serious vulnerability of the nation’s energy supply,” Andrew N. Liveris, CEO of Dow, told the Senate Energy Committee. “The U.S. is in a natural gas crisis. The hurricanes have dramatically underscored this problem, but they did not cause it.” He noted that Dow and other chemical makers have been forced to take aggressive action to mitigate the impact of soaring energy and feedstock costs, including implementing cost-cutting measures, shutting down inefficient plants in North America, and investing in regions of the world such as China and the Middle East, where natural gas is more affordable.