Thursday, April 07, 2005

The Fed's Head Honcho talks Energy at NPRA

Sadly, the insider did not go to the NPRA meeting in San Antonio last week.

Looking at the reports though, chemicals executives seem to be admitting to themselves that the good times are really just around the corner this time. It is surprising how quickly consensus develops in the industry.

Two things look optimistic though: the Alaskan pipeline and plans which could see up to 200 LNG tankers plying their way between the Middle East and the US.

Firstly, is there enough steel in the US for either of these projects, not to mention welders and welding rods? Secondly, what about the environmental impact of 200 tankers chugging across the ocean burning precious hydrocarbon resources.

This is just a very short sighted superpower blundering about in the darkness of its own making. The US would do better putting the ludicrously large amounts of money it looks set to waste building mammoth pipelines and armadas of vessels into research. The proposals aired at San Antonio are predicated on the idea that these are the only resources we have and there is no other way to use them but the way we are using them at the moment. Even Alan Greenspan (moderately dapper by the way) said in his speech the, 32 planned or proposed import facilities will offer capacity “far in excess of any pending needs".

If the US were to spend some of the money ($4-6bn would probably do), on funding their scientists to look at other ways of producing energy they might find a way round the problem.

Of course they could start making cars smaller and gas more expensive, but that really would by ludicrous.

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