The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1895-04-22
THE STANDARDS GRAB
SQUEEZE THAT WILL PUT $4,000. 900
IN THE CosIPANY,s TREASURY,
And Enable 1t to Control the Petro-
leum Market-Secret working He
hind the Zig Rise In Prices.


now in the most stupendous operation ever
undertaken in its career-to take from the
pockets of the American people. through the
medium of oil. a sum of money the immen-
sity of which is not realized by the mere
expression OF 1t in figures; to acquire as
part of its possessions the desirable oil
producing territory of the United States.
east of the Missouri river, and in so doing
to constitute itself supreme and absolute
owner of an indispensable lighting and fuel
material in this country as it is now die
tator of its distribution. Subordinate to the
main object is purpose to wrest heavy
profits from advances not alone in the BIZ
products of oil, but possibly in other prop
critics in which the Standard is interested
There are signs that the gigantic plan will
succeed. BY the advances made so far in
the price of refined oil the Standard has
added $4,000, 600 to the value of the product
it absolutely owns and viii sell to the peo-
pie. That is to say, that is the Standards
profit, but probably not all that has been
made up to this time out of the frenzied
advance in crude oil, which, unless the best
information is incorrect, it has manipulated.
The story of the deeply-laid plan TO ac-
complish this result, as developed by the
researches of intelligent men in the oil
country, is Interesting. particularly so to
the large classes in America who must pay
for its success.
The oil territory of this country, east of
the Mississippi river so far as developed,
underlies part of Pennsylvania and West
Virginia and sections of Ohio and Indiana.
The quality of the oil in the first-named
nelds is superior to that of the Ohio and
Indiana district. The reSiduum in refining
the latter is capable of only limited uses,
while the biproducts of Pennsylvania oil are
valuable. Among them long and costly ex-
Fermentation has developed and perfected
aniline dyes, paraffine for candles and for
insulating telegraph wires, wax for gums
vania oil always fetches higher prices than
Lima oil, as the Ohio product is called.
Grated most Largely in the Pennsylvania
field chiefly because of the greater profits
the biproducts of which are said to be as
valuable as the oil itself. The Standard has
been the buyer and refiner of the oil.
Though there are now and have been in
dependent refners, they small elements,
and the Standard is practically the market
to which producers go to sell their oil.
Some biologists and particularly school
OF them led by Morgantown CIV. Va)
professor within comparatively few years
have found followers to the theory that
the presence of oil may be accurately de-
termined by certain rock indications near
the surface. There are instances of the the
ory having been proved, but many of the
great producing oil fields have been located
are made by men who drill into ground that
their experience and observation induces
much of a lottery about it as there is in
gold mining.
DO NOT FURNISH ENOUGH
In consideration of the many chances
against striking oil at the end of an ex-
penditure of perhaps thousands of dollars
in boring for it, and also because of its
apparent disbelief in the soundness of any
searching system of searching for the fluid
and probably for other reasons, the Stand
I'd hoe Joff foo
ing oil from the ground, and devoted itself
to controlling the subsequent sale of it.
1t frequently has purchased wells and
leases in territory that was first developed,
but it's main business has been to refine
crude petroleum purchased at prices fixed
by itself. For several years past these
have ruled on an average too low to in
duce much prospecting in former
times. Excepting the Mcdonald, Sisters
vile and Manhattan fields, and perhaps a
few others, new territories have not been
found for several years. The product of
these has been insufficient to keep pace
with the demand in the ratio the Standard
desires. The figures of the visible supply
for a number of years are Instructive in
Eastern oil was 16,60O.0OO barrels. A year
later at the same date 1t was 100000. In
Feb % last the stock was down to AGO.
COO The production in the Eastern dis
triet IN 1879 " was 81 80 go barrels IN 1874
the same year were 100000 barrels; that
is. nearly 100000 in excess of the output.
The difference. as is seen, was made up by
drafts on the reserve supply. At the close
of 1894, estimating the Ohio reserve stock
reserve, as shown, at about 100000 barrels,
the visible supply IN the &c, country was down
fifths Of it not adapted to the most profita-
BILE purposes of the Standard. Consumption
had overtaken and passed production, in
one section at least. 1t became necessary
for the Standard to do something.
TO GOBBLE WHAT 1T DIDN'T HAVE.
Close observers of the company say the
course it marked out to fit the exigency is
clear. The Standard. they say, determined
to stimulate production. 1t set about first
to secure all the oil entering into the visible
supply, which it did not own already. Prob
ably the total was not large. Jan. 81 pro-
ducers were surprised to read in various
publications a circular signed by Joseph
Seep. chief purchasing agent of the Stand
ard, that thereafter the company would dis
regard the ruling quotations Of oil in the
speculative markets of Pennsylvania and |
pay whatever the markets of the world
justified. Some of the producers preferred
to store their oil when the circular was
issued, and 250,000 barrels were actually
The majority, however believing the Stand
ards then price would be lowered subse- |
a%entl hurried their The oil into its hands
and desired, and soon 1t owned practically |
ali of the small proportion of the visible |
supply remaining outside of its tanks when |
Seep's announcement was made. 1t had the |
supply cornered.
There were men in the oil country who |
suspected what was intended, but the gem
erat public had no thought of it. There
fore, three weeks ago. when oil awoke |
from a. lethargic sleep of three years, and |
prices on the Pittsburg exchange began
mounting skyward there was surprise and |
interest from one end of the country to |
the other. Oil has sold at the highest prices |
touched in years; The contagion of specu- |
lation has spread with great rapidity, but, |
notwithstanding that, there has not been |
as heavy volume of speculation as people |
at distance might suppose There are said |
to be fewer than LOCO pipe line certificates |
outstanding. The Standard has ceased issu- |
ing certificates. 1t is said to have secured !
part of those outstanding in the slump |
engineered in the market few days ago. |
1t is after those remaining-the representa- |
tives of the small quantity of oil yet re- !
naming out of the Standards possession, |
a quantity too small to cut a figure in the /
general supply.
Though the methods of the Standard |
have been in the direction of stamping out |
speculation, in this instance they have /
been changed. The market has been pushed |
up, allowed to slump, and advanced again |
in the same fashion that would be fol- /
lowed by the manipulators of corner |
in grain. The object of the corner in oil /