Price Wise: Take natural gas price risk off the table

01/05/2012

Long-term energy price and supply projections are always suspect. But for most manufacturers exposed to energy and resins price risk, it's worth asking, "How low can natural gas prices go? " Consider these recent articles:

Low Gas Prices Spur New Chemical Plants (WSJ, 12-27-11)

The boom in low-cost natural gas obtained from shale is driving investment in plants that use gas for fuel or as a raw material to make chemicals, plastics, fertilizer, steel, and other products.

Shale-gas production volumes will depend on environmental-protection rules set by state and federal regulators. Many environmentalists say that the chemicals pumped into the ground to unlock shale gas are a threat to water supplies....
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