Savannah morning news. [volume] (Savannah) 1868-1887, 1882-02-24
OIL.
The Latest Turn of Speculation
How Ssles are Made I'm The OIL Exs
change-The Great OIL Brokers.


NetC YORK suns Br0dJOTd Letter.
In January 90. 1856, 900 barrels of pc
troleum were sold on the Bradford Oil
Exchange, 81, 1853, 900 barrels changed
hands in Oil City, and on the Pittsburg
Exchange II AL, 900 barrels were sold,
making total of 60 489, 900 barrels at
these three great centres of oil sDecula-
ton. The amount of money represented
by the transactions was nearly $50, 000,-
900, the average price of the oil during
the month being about so cents barrel
Oil City has always led the quotations,
and is the oil specializing centre of the
world Bradford is gradually advancing
to that position.
The oil bought and sold on the Pc
troleum Exchanges is actual oil The
basis of all transactions is pipeline GER
tiicates. The United Pipe Line Com
pany and the Tidewater Pipe Line Com
pany are custodians of all the oil pro.
duced. They connect their lines with
the oil tanks at the wells on application
of the well owners, and, after gauging
the amount of oil, run it to the pipeline
storage tanks The producer receives a
certificate from the company, which is
his voucher for the amount in tank.
These certificates are put on the market.
At the beginning of the year the United
Pipe Lines held Is. 600, 900 barrels of oil
represented by certificates The market
price of cru ie oil is always the price bid
on exchange for certificates No bid
for less than one thousand barrels is
received. By rule of the Exchange
the brokers' commission is one half
of one cent per barrel. Thus, if a
broker buys oil at 80 cents for a GUS
toner, he charges it to him at 604 Oil
purchased may be delivered at any time
within three days. at the sellers option.
The margin required in specializing in
oil is $3.50 per 1 600 barrels These mar
gins are deposited in the bank. The
margin slips, certified by the bank, are
as good as the bank itself Pipe line
certificates are received as collateral as
readily as government bonds. After oil
has been in care of The Pipe lines for
thirty days it is called 'Od oil" The
Pipe lines charge averages about so cents
day for carrying oil. When this
charge is paid a slip testifying to the
fact is attached to the certificate. The
oil is then called ''freshened," and goes
on the market as new oil,
The low price of oil for few wears
past has greatly stimulated speculation,
and the commissions of the brokers are
paid by the laboring man as well as by
the millionaire. The oil market is in.
fiuenced by the most trivial causes. The
report that some one has struck a one
hundred barrel well in Allegheny county
will give some clique OF bears oppor-
tunity to show that the market is to be
flooded by rush of oil from a new ter
ritory. Prices go down, and the clique
takes in the oil that frightened specula.
tors sacrifice. Then report that well
in some part of the oil region has come
in dry" will send prices up on the
strength of prospective scarcity of oil.
These tlurries, as they are called, end
as suddenly as they begin, but they are
repeated with remarkable regulari-
ty. There is at present a formidable
bull movement on the market The evil
dences that the flow of the Bradford
field is declining are now unquestiOna-
BILE. The new Allegheny county field
has reached the limit of its production
and cannot make good the Bradford de-
cline. The bull element in the market.
although opposed by the Standard Oil
Company, which is naturally on the bear
side, being the principal buyer of oil,
steadily advanced prices for two weeks,
and has maintained market of unusual
steadiness Leading operators and many
who have taken the bear side are now
bulls, and predict that Oil will 60 to
81 80. For May deliveries 90 cents is
bid today. Spot oil brought SO cents. =.
The rich petroleum brokers nearly all
arose from very humble beginnings II.
L. Foster, whose commissions have
amounted to $50 600 year. came to Oil
City six years ago with So in his pocket.
Dan GOelet, of Bradford, ten years ago
was a bOotblack and messenger boy.
Five years ago he had saved enough
money to speculate in oil. He developed
nerve, endurance and daring, and to day
he is worth $500, 600. One of his trans
actions was to take the market against
a powerful combination. After forcing
the price up to 81 03 he sold 200, 600 bar
rels he had previously bought, making,
it is said, $163 900 in a few minutes. j.
j. Fisher of Oil City, is probably the
stitfest broker in the trade. He operates
for DR. Hostetter, of Pittsburg, who carries
hundreds of thousands Of barrels of oil
constantly. and for other capitalists. In
the early days of Oildom Fishers opera.
tons had as much influence on the trade
as the Standard Oil Company's have to-
dav. Henry Lewis, Of Oil City, is gen.
orally believed to be the buyer for the
Standard Oil Company. When he bids
for oil no one pays any attention to the
bids of other parties. D. w. Archbold,
of Titusville, was formerly a preacher.
His brother, John D., of the Standard
Oil Company, brought him into the busl-
ness. His commissions have been $50,
0O0 in thraa months