Natural Gas Woes Won't Disappear Unless Gov't Acts.(ISSUES & INSIGHTS)(PERSPECTIVE)

Byline: WILLIAM S. STAVROPOULOS

World oil prices have fallen as the Iraqi conflict has subsided, but a similar drop in natural gas prices has not occurred.

Natural gas costs remain painfully high for consumers, at a record, for this time of the year, of $6 per 1,000 cubic feet. Wholesale prices are twice the 2002 average and aren't likely to come down soon.

Millions of manufacturing jobs have already been lost in recent years, and history shows that high and volatile energy costs typically lead to recession. The only way to avoid a recession this time around is by quickly adopting a comprehensive and balanced U.S. energy policy to help ignite economic growth.

A severe strain in natural gas supplies, continued strong demand and a highly competitive global market would almost certainly keep the unacceptable and uncompetitive price of natural gas gyrating.

How bad is our natural gas crisis?

Inventories are low, and the resulting elevated prices have stimulated only a modest increase in drilling new wells. Even a more significant increase in drilling won't necessarily translate into increased production.