The New York herald., 1872-12-10
THE OIL TRADE.
Important Movement for a Fusion Of
Producers and Refnars.
The Associations Already Existing Meeting .ss
the Fifth Avenue Hotel To-Morrow-
Effect Of q Combination .

For the last three four years-and. indeed, for
that matter 1t might also be said from the days OF
the first discoveries In Western Pennsylvania
trade in petroleum has been subject to periodical
attacks OF "scare" Scarcely had the earliest wells
been brought into active production than two
classes OF
PETROLEUM CRoAKERs
began to make themselves known and felt. ThO
first believed that the supply OF the crude mate
rial was Inc xhaustible and that just as q silver
mine grows richer and richer the deeper you go, 80
would these subterranean fountains OF burning
mud run freer and freer the more you pumped OH
out Of them. Therefore, said they, 1t fellows
as necessary consequence that the mar
ket VIII be hopecssly giutted, In spite
or the enormous supplies needed
for the markets OF the world and the groggeres OF
the great American cities. On the other hand,
there were another class Of quakiHg GROWERS. who
upbraided the we-owners with their
RECKLESS ExTRAvAGANCE
In wasting the bountiful gifts OF Dame Nature. and
who prophesied that the time was not far distant
when petroleum oil would be a thing OF the past
These latter gloomy predictions have occasionally
been strengthened by the giving out Of q few wells
but faster than these have been exhausted others
total yield OF oil at present, II every producer were
to throw all he could pump upon the market, would
been before. Indeed, the
SURPLUS PRODUCTION
OF oil has at length grown into 80 palpable an evA
that both producers and reiners have taken meas
ures to protect themselves against competition
which would be, SO far as their capital was con-
cerned, very much like that famous duel OF the XII
kenny cats, which was waged until nothing but y
couple of useless tails remained. The refnega
TRADE LEAGUE
among each other, and at last after various more
or less decided failures have continued to unite in
o. fn1n hu str ar1Ii not tim Nnnr
fning is done In Pittsburg, Cleveland. New
York and Philadelphia, In each Of which cities
these are OF very different producing capacity,
but, taking the present basis of their business a.
standard, they have pledged themselves to in iu-
ture manufacture only so much Oil as the organza-
tiOn may pro rata permit them to do Care will be-
taken it is said, by the friends Of this scheme TO-
always
w well supplied; but ON on the 1 other hand i VIII never
ners nor an over supply.
Then, again, the producers, as the well owners
are caea ao IN tne @ Sd language OF xne
About the end Of September they perfected their
organization, and, on the ground that the market.
was then hOpeleSSly glutted, determined to stop
producing Tor few weeks, and then only resume
III moderation, being guided by the
APPARENT NEED
of the demand. This programme has been carried
out, and the result has been that instead of Oil
selling 81 90 bar barrel hc OF iSrty gallons to which
the we'll owners cannot make even the smallest.
percentage upon their capital invested, 1t has
So 60 q barrel The producers say that they Will
only be satisfied with minimum OF $5 per barrel.
and Will steadily push on their present scheme
until this point is reached.
And now, producers and re1ners having thus
each cryStalllZed into tolerably compact and
MANAGEABLE BODIES,
have started the idea Of fuslng into common Or
ganization, or at any rate, working together IN
perfectly willing to agree to the $5 per barrel part
OF the producers programme ir the latter will con-
@ thrown a0 upon the marset "a. and thus enable them
sufficiently to control the trade TO obtain iair
In order to discuss these matters and arrive At
some definite understanding, q
GENERAL MEETING
OF both producers and refners will be held tO-mor.
row Wednesday, at the Fifth Avenue Hotel.
But another great body OF American citizens
the consumers-whO are also to the full as much
interested the price OF oil either producers
refners will now doubtless be anxious to know
would clearly convert the whole oil business into
pure monopoly, will be upon the
PklCE OF OIL. -,
Supp0sing oil to sell at SIS barrel, the rate OF
crude oil in New York would be about seventeen or
eighteen cents o gallon-that is, twelve cents =
gallon original price, and i've or six cents for rail-
road freight. Adding the cost OF manufac turing to
this the rates would it Is stated, rule somewhat AZ
follows :-Refned OIL in bulk, twenty-six to twen-
ty-eight cents gaon in barrels, thirty to thirty
two cents gallon; in tin cases Uor exportatiOn).
thlrty-seven to forty cents gallon This would be
O slight advance upon the present average rates,
but nothing to particularly grumble about.
THE DANGER,
however, would be that the trade being for the
future thus absolutely under the control OF the pro-
ducers and refners, they would be unable to resist
the temptation to gradually raise the rates and
enjoy the sweets OF successful monopoly. They
are, like the rest OF the world, but lfail human
nature and who among could be trusted to say
no to such an immense inducementS
The prospects Of this alliance between the pro
ducers and reiners are, however, happily
BY NO MEANS
so bright as they might be.
"Do you Think asked q HERALD reporter OF the
representative OF OF the largest refining inte-
rests OF the city yesterday, that this union will be-
made ~
"Well, 1t may be made" was the reply, "but do
not think thatt stand for very long, even II it
is. The producers are too many IN number to long
agree"
ayes but they will soon find out the truth of the
lesson in the old liable about union is strength and
the bundle OF fagOts."
perhaps 80, but
VERY GREATLY DOUBT
It, New wells will be discovered, and then there
will be endless disputessas to the basis upon which
they are to be admitted within the lines Of the as
sociation. or course the old men will try to cus
them down as low possible, and they will be dis
satisfied and perhaps refnse to come in at all. Ana
outside public, and, dare say, that would in time
have Its erect and slnash up this combination.
which is Of course, a monopoly that can only ba
defended on the ground that without some such
ring tactics the trade will be ruined"