The Bush administration said there will be “only limited opportunities” to increase supplies of domestic natural gas over the next 12 to 18 months, which will make “conservation, energy efficiency and fuel switching” crucial in satisfying demand.

“This is why the speakers and attendees at the [scheduled June 26] Summit will be substantially consumer focused. I would note…that the feedback we have been getting from the natural gas industry has been strongly supportive of this conservation message as they are concerned about the long-term effect on the market of these high short-term prices,” Energy Secretary Spencer Abraham responded in a letter to 30 Democrat senators, who expressed their concern about high gas prices and tight supply to him in late May (see Daily GPI, May 29).

The Senate Democrats advocated conservation, energy efficiency and fuel switching as the quickest way out of the current market dilemma.

Abraham last month called for an emergency meeting of the National Petroleum Council (NPC) on June 26 to address industry-wide concerns about the price and supply situation for gas. The NPC is a 175-member oil and gas advisory committee to the Department of Energy (DOE) secretary.

Besides the NPC members, the meeting “will…bring together state and federal regulators; industrial, residential and commercial gas consumers; electric utilities and independent generators; along with experts in energy efficiency and conservation to discuss and develop recommendations relating to the future of the natural gas markets,” he wrote to Sen. Jeff Bingaman of New Mexico, as well as other senators.

In addition to “sharing the same opinion” on the role of conservation in the short term, “I am pleased that we also are in agreement concerning the need to increase natural gas supplies,” said Abraham. A study by the NPC, due to be released in September, will offer a “comprehensive evaluation” of future gas supply and demand issues, he noted.

While conservation efforts may help in the short term, industry experts agree that Capitol Hill lawmakers must give producers greater access to public lands and coastal waters in order to satisfy long-term gas demand.

The House Energy and Commerce Committee is scheduled to tackle the gas demand-supply imbalance during a fact-finding hearing Tuesday, during which Federal Reserve Chairman Alan Greenspan and eight leading industry executives will testify (see related story).

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