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Senior Advisor

Energy prices matter

This is what the ant-frackers are worried about. The cheap gas might mean manufacturing. Something the envirogreens hate.

 

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LUDWIGSHAFEN, Germany — The sprawling chemical plant in this city along the Rhine River has been a jewel of Germany’s manufacturing-led economy for more than a century. But the plunging price of natural gas in the United States has European companies setting sail across the Atlantic to stay competitive.

German chemicals giant BASF, which operates the plant here, has announced plans for wide-ranging expansion in the United States, where natural gas prices have fallen to a quarter of those in Europe, largely because of American innovations in unlocking shale gas.

Among those most affected are energy-intensive industries such as steel and chemicals, because they use natural gas as a raw material and power source. With Europe lagging in energy production, manufacturers on the continent warn that a chain reaction could shift more and more investment to U.S. shores.

“It’s become clear, with the drop in gas and electricity prices in the United States, that we are, at the moment, at a significant disadvantage with our competitors,” said Gordon Moffat, director general of Eurofer, the main lobbying group for European steel manufacturers.

 

http://www.washingtonpost.com/world/europe/european-industry-flocks-to-cheap-us-gas/2013/04/01/454d0...

4 Replies
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Re: Energy prices matter

BTW, folks who believe in the wonderous invisible hand  of the free market got some 'splainin' to do about why NH3 isn't $250/ton with $3 NG.

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Veteran Advisor

Re: Energy prices matter

How much is NH3 now?
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Senior Advisor

Re: Energy prices matter


@hardnox604008 wrote:

BTW, folks who believe in the wonderous invisible hand  of the free market got some 'splainin' to do about why NH3 isn't $250/ton with $3 NG.


Supply versus demand. Back then we never had 96 million acres of corn. Also with the new EPA regulations much more is used for the scubbers in coal fired power plants.

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Re: Energy prices matter

Ah yes, the invisible hand even applies to oligopolistic cartels?