Telegram-herald., 1890-01-21
THE PETROLEUM PUZZLE.
Way Pennsylvania or Stands Sr-A
Aaeswosr Ike. AZ s1O3 = Barrel
-oa - To Cheap Angwsy, ssy shs
BFoksrs-A MISTER Ao@st ths bisna-
lax u Ohts sna FsHGsyis4nl.
Cr4ae some statistics,


ooPyRlGsr $50
Petroleum prices are uysserio1sly
dull al .nint te-esrng as oS per bar
re- Ny they o-gas 10 shoa RAPID
a1yaace ~lta tae liFel-esl zind q trad
lag
Ihat Is What Young broker on the
NeN York Consolidated Exchange said
% me-
asked hin n hy
In substance. the reasons a. given are
that OIL Is TOO cheap az practically =
doll2r barrel when prod uc-lon has de-
clined nearly one-thifd in the Penn
sylvania regions within few years and
stock, from So COO o00 barrel, % ab0ut
one-thl-d % that quantity witaln a
similar period
Neu, what are you brokers afraid
of2' I asked Why don't you al hang
over ne bull-rinE and bay OH on the
strength OF its statistical posiIiOn2'
The elegantiy-ke young speculator
looked az ne pityingiy and seemed in
clinsdato let the sublec drop, but he
finally thought better OF IT, and asked
whether I was one OF that small and
4
suppose that prices a. the Exchange
are made daily after a careful study Of
the statistics OF the products traded In.
No, not exactly" | replied. hut
there IS a good reason for petroleum :
apparent ignoring the law OF supply
and demand, 50 far as price is con
cerned
III tell you what IL IS he added,
III We, that Is the brokers and our
outside clients. bull oil. the Standard
j. likely 20 bear il, and there we arc;
If We sell IL short. the Standard turns
up as holding all the available certif-
Gates, and there we are again. SO we,
having been 10 school, are wise IN our
day and generation, and let oil alone
But as you say, oil has got to ad-
vance, sooner or later, presumably
sooner, with stocks disappearing at the
rate OF : 600, 000 barrels a year. which
amounts 70. let mo see about 666, 600
barrels month, %. 600 barrels a day,
! a25 barrels an hour, or about 1917 bar
/ rels minute
"Ah, replied the young speculator,
! but you forget the Ohio oil stocks
They are large. and rumor has il that
the Standard. which practically owns
the entire Ohio field and product has
/ been blending its Pennsylvania pro-
| duct in tanks with the heavier Ohio
| oil. by means OF its new pipe lines
connecting the Pennsylvania and Ohio
/ fields"
Evidently the statistical position OF
! petroleum is a puzzle 10 some people in
the trade as we'll as to those out OF it.
Mr.. George K. Gibson is an older ex-
1 pert on petroleum statistics and dis
! coursed at length when called on hi m
for some facts regarding Ohio field oil.
| ''I do no. know. OF course. whether
| the Standard company mix their Ohio
/ crude with stocks Of Pennsylvania
! petroleum, but such charges have becn
! made. The Ohio product has been
! produced in rapidly increasing quaint
/ ties of late, and the popular supposi tion
is that its quality will not permit it to
ompete with the Ponnsylvania 30
duct, its weight and smell thus far
! proving too refractory for known rcan-
ing processes: so 10 has been mainl =
used for fuel"
| "Who has charged the blending of
| Ohio and Pennsylvania oils?"
Various English journals, which
have complained OF the deteriorating
quality OF OIL reaching them from the
United States OF late.
TO what do you attribute the indif
ference OF crude petroleum prices 70
the apparent statistical position?"
1T may be 'ascribed. perhaps, 20 a
widespread fear Of tho ability OF stand
ard rctiners or refneries 20 produce
from OHIO oil product equal 20 Penn
sylvania refined. which, of course, would
add the whole Ohio field and stocks to
what Pennsylvania has to offer, and ma
terially alter what is called the stats
tical position. Then. of course, few
outsiders care 20 attempt a speculative
movement in petroleum, unless they
think they know what the Standard Oi
| Companys views are as 20 the price.
"What il the price Of Ohio oil?'
81. IS quoted at about fifteen and
twenty cents per barrel, o. one-seventh
the price OF Pennsylvania crude"
DO you know OF anyone near a;
hand who could reply definitely suC
| positively 70 tho charge Of mixing Ohio
| with Pennsylvania oil2
Mr. Gibson was guilty O, just a sus
| picion of SIN ie wien 10 replied oh
yes II you VIII call on Nr. Rocker
fsIler. Pres dent Or tho Standard oil
| Company. across tho street. ! have nc
| doub, ne could reply definitely on ths'
! n would 90