Federal Reserve Board Chairman Alan Greenspan will be waving his red flag on natural gas supply issues again on July 10 in front of the Senate Energy and Natural Resources Committee. Three weeks ago Greenspan told a House panel that if the United States wants to maintain its current standard of living, it will have to become a bigger player in the global gas market by importing more liquefied natural gas (LNG).

Senate Energy Chairman Pete Domenici announced a full committee oversight hearing to explore the reasons behind the high price of natural gas, assess its impact on the economy and consider potential solutions. The hearing will be held July 10 at 10 a.m. in Room SD-366 of the Dirksen Senate Office Building. Greenspan will testify. Other invited witnesses will be announced at a later date.

“I am very troubled by the high price and tight supply of natural gas in this country,” Domenici said in a statement. “I have long said that America is heading down the same road with natural gas that we’ve gone down with oil. We aren’t producing enough to meet our needs. Increasingly, we are looking to foreign shores for the solution. Tight supplies of gas could have a significant impact on our economy, as Chairman Greenspan has already stated.

“Mr. Greenspan’s comments earlier this year have raised national awareness of the problem in a way only Mr. Greenspan can. In this environment of heightened concern, I think we can overcome regional viewpoints and philosophical differences to tackle this problem together,” Domenici said.

However, few are likely to find comfort in Greenspan’s conclusion that the United States must become more dependent on additional foreign sources of energy. “There’s no way [that] we can be self-sufficient” and completely meet demand with domestic resources, he told the House Energy and Commerce Committee during a hearing on the gas supply-demand imbalance situation. Unlike crude oil, however, Greenspan noted that natural gas is much more dispersed throughout the world, which could minimize the security risks (see Daily GPI, June 11).

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