The nation’s chief economic guru, Alan Greenspan, signaled a growing alarm over high natural gas prices and tight supplies during an appearance before a joint congressional panel Wednesday.

In testimony before the Joint Economic Committee, the Federal Reserve chairman told lawmakers his concern was prompted by sharp increases in gas prices, “extremely low levels” of gas in storage, a slower than normal rebuild in storage inventories, the “inability of heightened gas well drilling to significantly augment net marketed production,” and dwindling gas exports from Canada.

“I’m quite surprised at how little attention the natural gas problem has been getting, because it is a very serious problem,” said Greenspan in response to a question from lawmakers, the Reuters newswire reported. The chairman indicated that Congress will have to deal with the conflicting federal policies on natural gas, with high prices already taking their toll on industries that are heavily dependent on gas.

“I don’t think we’ve yet seen the implications of [price pressures], but they are going to arise, and it is coming to your subcommittee,” Greenspan was reported as saying.

Meanwhile, a chemical manufacturers’ group is calling on Congress to set up an independent national commission to assess gas demand and available supply over the next decade, and to identify the potential supplies that are off-limits to producers due to restrictive federal policies. Commission members, who would be appointed by President Bush after consulting with Congress, would be tasked with proposing solutions to the current supply-demand imbalance situation, according to the American Chemistry Council (ACC).

There is a “gradual acknowledgment that we’ve having real supply problems,” said ACC spokesman Tom Gilroy. “We’re going to need the gas. This [commission] would show us where it is,” he noted. It will “provide solutions to the problem, make recommendations.”

Capitol Hill lawmakers “created this natural gas crisis by passing laws that create more demand for natural gas and other laws to restrict access to its most promising reserves,” the council said in a statement. “Congress must end the crisis by opening up access to restricted supplies.”

The commission would go a step further than the National Petroleum Council (NPC), an oil and gas advisory committee to Energy Secretary Spencer Abraham, which is expected to release a study on domestic gas markets in September. That study will provide mostly a “snapshot of the gas markets in the 21st century,” but it isn’t likely to offer any real solutions, noted Gilroy.

The Arlington, VA-based council said it welcomed Abraham’s plan to convene a special June meeting of the NPC to address the “looming challenges” in the gas markets. While the NPC will spotlight the problem in its upcoming study, the “ACC believes that the true situation is even more critical than the picture the study will paint,” it said.

“Spiking energy prices and ongoing energy price volatility are making U.S. industry less competitive in the global marketplace. As a result, companies may have no choice but to shut down capacity and lay off employees — especially in the petrochemical strongholds of Texas and Louisiana,” the ACC noted. Chemical manufacturers currently are the largest industrial users of gas, and have been hard hit by rising gas prices.

In April, the Energy Information Administration reported that gas storage levels fell to an all-time low, leaving the U.S. with only an 11-day supply in storage, the council said. Meanwhile, gas demand is expected to rise 48% in the next 25 years, it noted.

“Natural gas is to the economy what water is to an ecosystem. Today, America is facing the worst drought in natural gas supply in the nation’s history,” the ACC believes.

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