Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1892-02-27
THE OIL SITUATION.
Different Opinions as to the Outlook
for a Better Price.
THE NOBEL BROS. THE BOGIE MEN.
Some Reasons for the Hard Times Prevailing
at Mcdonald.
WORK AMONG THE WELLS YESTERDAY

| Oil producers have been for months like
travellers lin desert. They have been
watching and following a mirage on which
they believed they read an advance in the
price of their product. Their vigilance has
never laxed
Time and again the mirage has faded
away, and hope has been supplanted by de-
spair, only to reappear and revive their
dropping spirits.
They have repeatedly charged that the
law Of supply and demand has not regulated
the price of petroleum. They say the stocks
which are now being piled up will be dimin-
ished before the end of another year;
that the great Mcdonald field will
drop to an Insignificant pool, and that con-
sumers will be crying for more oil Pro-
! ducers VINO claim to be thoroughly posted
On the situation throughout the country
| assert that crisis in the business is immi-
| nent unless the market advances. All kinds
of failures are predicted, and disaster to the
trade is foretold even by men who are con-
sidered level-headed by their business asso-
| ciates.
Such sentiments are heard every day in
offices on Fourth avenue. but it is seldom
that producer is found who has given any
consideration to the work of the refners and
exporters, who are supposed to take care of
the immense quantities of oil which are
produced and are in tanks above ground.
Several Causes for the Depression.
A man who has made the oil business a
life study, said yesterday in speaking of
the situation: "There are several causes
which tend to reduce the price of oil and
which have brought it to its present level.
The law of supply and demand has more to
do with it than the average producer would
believe at first thought.
"In the first place, the daily production
of Pennsylvania oil, to put it at very low
figure, is $4,000 barrels. Now the daily
consumption in the United States is only
from $4,000 to $4,000 barrels. On top of
this comes the production of the Ohio
field, which exceeds even that of
Pennsylvania. Ali of this .. surplus
stock must be taken care of and
a market found for it. When we speak of
supply and demand, it is of the present we
speak and not the future. When an oil
producer figures up his wealth, and est-
mates the value of producing property, he
takes as a'basis the present price of oil, not
what it may be year from now. 1t is
the same with supply and demand. We do
not figure how much stock we will have in
excess of the production year from now,
but what we have at present.
ga market must be found for this surplus
oil which is not consumed in the United
States. Europe is the most prolific field.
clash Immediately with the Nobel brothers.
No Competitors in Russia.
''These two men have hold in Russia
which competitors have so far failed to
weaken. In Russia, you must understand,
the Gar owns all lands and all rights to the
minerals which may be in the earth be-
meath. The people simply pay tax for the
privilege of using the Cars property. He
can confscate land at will, and title is un-
known. He alone grants franchises and
privileges, and all but the lucky ones must
stay out. The Nobel Brothers are favor1tes
with the Czar, and as they have been in the
Russian field since its incipiency and have
built up the business in the Caspian Sea,
where they have a feet of tank steamers,
they are granted exclusive privileges
and have no competitors Whenever
a competitor to the Nobel brothers appears
in Russia he is given gentle hint that his
health and pocketbook might be improved
by change of residence.
eThe Rothschilds are back of the Nobel
Americans out of the European markets.
All tricks and schemes known to the busi-
ness world are resorted to, but the Ameri-
cans are slowly gazing ground. The Russian
oil, moreover, is inferior to the American
product, but this makes little difference to
a people who have been accustomed, from
time immemorial, to burn tallow Dip ANY
improvement is welcome, and the Jump
from a tallow candle to kerosene oil is to
them astounding. 1t is not so much to the
rich, as to the masses that the oil trade
caters.
Features of Russian Wells.
'The production of the Russian fields can
be run up to more than 100000 barrels a
day. In that country they drill 10-inch
hole from 400 to /, 400 feet in depth. The
wells do not flow like they do in this coun-
try, but fill up and seem to slop over I'm
like ours they can be shut in until such
time as the owners want to use the oil,
when they can be opened up and made to
produce. That alone is great advantage.
''The Meteorological has had most de-
pressing effect on the trade in this country.
1t has piled up the stocks and thereby given
the market black eye. Notwithstanding
this and the knowledge of what the result |
would be, the operators kept the drill going |
with an energy never before displayed in |
the history of the oil business
SIT seems to be notorious fact that men |
will drill for oil though it should 60 to Is |
cents barrel They did this in Ohio. 1t |
has not been the oil operators who are so |
much to blame for the Mcdonald work. 1t |
is men here in Pittsburg. who went into
the oil business simply as side issue. They |
did not have all of their capital invested, |
and therefore were not SO much concerned |
in the market yalue of the stIlff
"Oil well supply men have beeV to blame |
All that was necessary at Mcdonald was |
for a man to get lease, and the supply men |
would furnish him with the machinery |
necessary to put down well.
Light Wells Were the Rule.
'In seven cases out of ten his well was |
either dry or light, and now he is unable to
pay his debts. This is why the supply men
are making such poor mouths. They saw
times are hard, that collections cannot be |
made, that they are daily renewing papers
that they have renewed before. What did |
they expect? They furnished the stuff to
penniless Taen and trusted to luck to get |
their money. They are now reaping the
result of a reckless policy.
'There is some excuse, however. They
did it when the excitement was at its |
height, when values were inflated and
every man believed his we'll would be
gusher. 1t was and is this class of men /
have just spoken Of, the 'tenderfeet,' who
compelled the old-timers to drill. The
tenderfeet would plant a well right up
alongside of an operators line and compel
the latter to put down we'll to protect the
oil under his lease. If there is one there
are 100 wells in the Mcdonald field which
the owners have been forced to drill Just in
this way.