A lot has been made, including in Congress, of the idea that gas prices would not be as high as they are today if it weren't for speculators playing in the oil commodities market.
In an NPR interview, Andrew Liveris, CEO of the Dow Chemical Company, made a comment that makes me wonder if there is an implicit agreement between speculators and the big oil companies for the oil companies to put much less effort than they might into development of alternative energy sources.
Dow Chemical's products are plastic goods, which are made from petroleum. This week Dow announced that it will raise prices and slash its production because of lower demand for its products and the increased cost of petroleum.
Today, NPR's ``Day to Day'' interviewed Liveris as part of a report on the upward effect on inflation caused by increases in the price of oil. Liveris called for oil drilling in the Arctic National Wildlife Refuge in Alaska, and off the coasts of the United States. Both proposals are controversial, Liveris admitted.
He said he is not only interested in the drilling projects. He called for an effort -- a new Manhattan Project, as he put it -- to build more nuclear power plants and develop wind- and solar-power technologies.
``The signal on increased production, and really speeding up the alternatives in terms of nuclear and, of course, renewables; I think that would send a signal to the market and help stabilize this volatility we're all seeing,'' Liveris said.
(The Manhattan Project was the huge international effort that produced the first nuclear weapons during World War II.)
Liveris has in mind a program that would necessitate government action. The drilling would require legislation to go ahead. Also, Liveris suggested use of funds from the Department of Energy in part to development more efficient forms of transportation.
Today I e-mailed Liveris, asking if energy firms aren't undertaking a large-scale effort because volatility may be in their interest. ``The trend of sticking with petrochemicals has meant, of course, dramatic increases in the price of gas, a component of increased profits. Also it seems, at least for now, to be benefiting oil-commodities speculators.''
I asked Liveris if he would agree that the petrochemical industry, to serve its at least short-term interest, is doing significantly less than it could to steer the U.S. away from its status quo carbon-based economy.
It shouldn't surprise anyone if Dow does not reply to my message. It's a huge company, and Liveris and his public relations people have bigger matters to attend to. If I get a reply more substantial than a form letter, I'll post an update.