The herald., 1896-04-04
OIL LIKELY 70 GO LOWER
RUMORS OF SALES HAVING BEEN MADE
AT REDUCED RATES
The Exchange Used o Catspaw BY Outsiders.
Who Just Underseii Them and Thereby
Secure the Trade-Action Expected by
the Exchange ON Monday

I8c0s t0o OIL 6ltuaVtON JuSt Nv pEescne 10 III q
decidedly perturbed condition. For some
days no important transactions have taken
place. both producers and consumers
awaiting some definite move which would
indicate whether further advance was to
be anticipated or, on the contrary. slump
in the rate was to be expected. Inc whole
matter stands today just about as follows;
For some time the oil exchange has fixed
the local price on crude petroleum. Each
Monday q meeting of the directors has
been held at which the quotation of that
date has been considered and the rate for
the ensuing week fixed. Now the oil ex-
change controls through its members pos
sibly 40 per cent of the local field. The
balance of the producers are affiliated with
other oil companies or do business as in
dividuals. Two weeks ago the exchange
made a rate Of 80 cents per barrel f. O. b.,
which equals about 20 cents at the wells.
1t has been found that outside producers
were selling most of the oil, although each
and every one claimed that they were ad-
herring as closely as possible to the estab-
lished rate.
OF course the exchange could not at.
tempt to say at what price these parties
should dispose of their products. and has
sales were made consummated by outsid-
ers. Consumers found their supply of fuel
running low, and have gone into the field
and bought sufficient for their immediate
needs at from 60 to 65 cents per barrel.
This has been especially CALLING to some
exchange members, who were forced to sit
idly by and see others receive nearly their
quotations on oil. put just enough lower to
secure all the trade. These members are
now just about ready to kick over the
traces. They say. and with reason, that II
this continues they will either be compelled
else reduce the price. which would imme-
diately mean corresponding fall all
along the line and q consequent cutting
and general decentralization.
Oil is now selling in San Francisco at
about all it will bring in competition with
coal. and the only chance to maintain the
local rate seems to be to find some means
to dispose of the surplus product. Ir all
the we'll owners would agree to ship GER
tain amount to that city. accepting slight
ly lower rate per barrel for the oil thus
shipped. there would be possibility of
maintaining the present or even higher
rate for the local oil. But this is just what
cannot be done. Rumors of sales at so
cents are heard on all sides. while on the
other hand some few hundred barrels have
been disposed OF at 20 cents at the wells;
at least, that is the price claimed to have
been received.
Although the production of the field has
fallen off greatly the slow movement of
oil in the last couple of weeks has caused
a certain amount of accumulation which
is on hand TO be marketed. No one need
be surprised if on Monday the price of oil
shall be lowered by the exchange, although
such move will be vigorously fought as
bound to demoralize the market. Tne dis
gruntled members are kicking vigorously
and will insist that the exchange make
some move to secure its proper share OF
the market. In other words something is
going to drop soon.
The total stock of oil on hand above
= = To- IS
900 barrels in this vicinity and shipments
during the month of March we're some.
what less than during February. 1t is
estimated that the exchange handled dur
ing that month about 10000 barrels and
the Union Oil company perhaps $4,000.
There are some $500 barrels in the ex-
change tanks, and they also have about
45O in the Union tanks. Very little oil is
being hauled out of the field, many of the
tank wagons lying idle. Two wells have
been attached by the sheriff in the past
two days, one of the unlucky ones being
an exchange member.
As showing the diminishing flow of the
wells, Mr.. Turner of the exchange yester-
day stated that out of his eleven wells he
was not pumping to exceed twenty barrels
| per day. A year sgo he was producing
$500 barrels per month, whereas he now
| gets barely 500. Ono of his wells is being
deepened and from it he expects fifty or
| The same party now has on hand some
| 1000 barrels ready for market. The ex-
change is now negotiating a large.sized
contract with San Francisco parties and
hopes to have the deal completed in few
| days.
The tank vessel Talbot is expected down
here by Monday or Tuesday and will at
once have tanks for 5000 barrels more Of
| oil put into her, so that on her next trip
she will load a full 9OOO-barrel cargo. W.
f. Botsford, her principal owner. and
president of the California Oil Transport
tation company, left for San francisco
yesterday afternoon. The Talbot will not
dock at San Pedro this time. but at either
| Santa Monica or Redondo.
There are now some eighteen drilling
outfits working in the field, many on new
wells, but few engaged in deepening old
| holes.
From Ventura it was yesterday reported
that the tank steamer Loomis had cleared
for the north with 66OO barrels of oil for
the Pacific Coast Oil company.
A party well-known IN local oil circles.
John B. Armstrong. is now in Napa and
proposes to sink several wells in that vicin-
ity, being convinced that he can find plenty
of petroleum at 1000 feet or less. If a
new district should be opened in this region
it would greatly tend to stimulate the use
of oil for fuel purposes all along the coast,
North and South unite in approving
Prices Cream Baking Powder.