In letters sent out to every member of Congress on Thursday, the American Chemistry Council (ACC), which represents America’s largest industrial users of natural gas, the chemical industry, warned of an impending natural gas crisis that will trigger an economic recession.

“America is facing a sudden, unprecedented and crippling energy crisis…in natural gas supply,” ACC President Greg Lebedev warned in the letter. “I am writing to ask your help in remedying the situation that will have devastating consequences for the chemical industry, for the U.S. economy and for all Americans.”

He noted that every recession since World War II has been preceded by a run-up in energy prices. Lebedev noted that gas prices reached record highs this week in response to extremely low gas supplies and rapidly falling gas storage levels during a period of extended cold weather in high demand areas.

“North America has enough natural gas reserves to meet our needs,” said Lebedev. “But recent legislative, regulatory and market trends have placed greater demands on our natural gas supply without providing for economically efficient and environmentally safe measures to increase production.”

The effects of this problem will be felt throughout the economy, and could result in the loss of thousands of jobs unless immediate action is taken, the ACC said.

“Americans will pay the price. They will feel the effect of skyrocketing natural gas prices in the form of more expensive food, spiraling home heating bills and higher prices for many pharmaceuticals and consumer goods,” Lebedev warned in the letter. “Worse yet, the natural gas crisis threatens the livelihood of thousands of workers who rely directly or indirectly on the business of chemistry.”

The ACC represents the $463 billion chemical industry, the nation’s largest exporter, and its second largest manufacturing sector with one million people employed. “As America’s largest industrial user of natural gas, the chemical industry converts billions of dollars of natural gas into hundreds of billions of dollars of materials used to produce the items that we need and use everyday — medicines, food, clothing, to name just a few.”

Lebedev said the energy crisis could not have come at a worse time because the nation needs a strong industrial and chemical infrastructure to support the war on terrorism. The chemical industry was recognized by the U.S. Department of Homeland Security as “critical in providing the products that make our military, police and emergency responders the strongest and best equipped in the world,” he said.

Congress needs to act immediately to head off the next recession, the ACC said, repeating what many others groups, including the American Gas Association (see Daily GPI, Feb. 26) and the Industrial Energy Consumers of America (see Daily GPI, Jan. 22), have said. Congress and the Bush administration need to help open up new areas to responsible exploration and production, enable timely increases in imports of natural gas, ensure adequate supply delivery to customers, and support efforts to streamline gas pipeline construction, the ACC added.

“Congress must move quickly to enact energy legislation that will rapidly expand domestic gas production and incentivize conservation in all sectors,” said Lebedev.

The ACC provided a list of remedies to the current problem that calls on Congress to do the following:

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