Wholesale Prices Rise Sharply in March; Energy Costs Help Drive Increase, With Natural Gas Up 4.2 Percent

Congress Must Include Domestic Energy Supply on 2008 Agenda

ARLINGTON, Va., April 15 /PRNewswire-USNewswire/ -- The U.S. Department of Labor reported today that U.S. wholesale prices surged 1.1 percent in March, the second-largest increase in the past 33 years, exceeded only by a 2.6 percent rise in November 2007. Energy prices jumped 2.9 percent for March, with natural gas up 4.2 percent, and the U.S. economy continues to show signs of weakening. In 1999, U.S. natural gas prices were $2.38 per million BTUs (MMBtu). Today, they are $10.25 per MMBtu.

The American Chemistry Council (ACC) issued the following statement:

"U.S. natural gas prices have been rising for more than seven years while Congress failed to adequately address the domestic energy supply problem. Manufacturers, residential consumers, farmers, small businesses, schools and hospitals have felt the pain of the natural gas crisis in lost business, lost jobs, reduced global competitiveness and higher home heating and electricity bills. In the business of chemistry, our energy costs have tripled, from $25.1 billion in 1999 to $72.8 billion in 2007. For our industry and others that compete globally, we cannot simply pass along these higher costs. Instead, we lose U.S. production, business and jobs - often to overseas operations and competitors, where natural gas is far less expensive. Already, millions of American manufacturing jobs are gone.

"Sadly, the natural gas crisis is one that Congress has some degree of control over: natural gas prices are set regionally, not globally, and the 430 percent increase in U.S. natural gas prices since 2000 is largely due to federal energy policies that drive up demand (e.g. for cleaner electricity) while restricting access to domestic supplies. With the economy in trouble and energy prices largely driving the inflationary and recessionary threat, it's critical that Congress include domestic natural gas supply on its agenda this year. In addition to increasing energy diversity and efficiency, we strongly encourage Congress to enact domestic energy supply legislation such as the National Environment and Energy Development (NEED) Act (H.R. 2784). And Congress must advance other low-emission options such as carbon capture and sequestration, nuclear, energy efficiency and renewable energy programs to meet climate policy objectives."

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The American Chemistry Council (ACC) represents the leading companies engaged in the business of chemistry. ACC members apply the science of chemistry to make innovative products and services that make people's lives better, healthier and safer. ACC is committed to improved environmental, health and safety performance through Responsible Care(R), common sense advocacy designed to address major public policy issues, and health and environmental research and product testing. The business of chemistry is a $635 billion enterprise and a key element of the nation's economy. It is one of the nation's largest exporters, accounting for ten cents out of every dollar in U.S. exports. Chemistry companies are among the largest investors in research and development. Safety and security have always been primary concerns of ACC members, and they have intensified their efforts, working closely with government agencies to improve security and to defend against any threat to the nation's critical infrastructure.