The herald. [microfilm reel] (Los Angeles [Calif.]) 1893-1900, 1897-12-13

OIL is SCARCER
Fifty Thousand Barrels
Sold Last Week
BELOW THE DOLLAR MARK
TO CLEAR THE MARKET FOR
DOLLAR OIL
BELOW THE DOLLAR MARX
Diminishing Flow, Increasing Stor-
age, Yet Lower Prices, Arouse
Suspicious Of Speculation


New developments in the Oil fields dur
ing the past week have been tritling and
results of the weeks pumping have been
discouraging. No wild eating for new
fields is going on, the Scott and Lotus
well is thoroughly drowned out, the Cot
tage Home tract contains no oil in pay
ing quantities, half the new wells show
very meager results and the flow of all
wells has diminished from a fifth to a
half Of what 1t was before the shut
down.
| This marked diminuuon Is attributed
to the packing of sand in the oil seepage
channels during the shut-downs ordered
by the producers trustees.
Thirty thousand barrels were sold at
rs cents to the Standard Oil company
December 9th, and 10000 barrels to the
Santa Fee during the week at IS cents
delivered.
These large sales at low prices in the
face Of diminishing flow and increasing
storage capacity by the trustees who
have claimed to want dollar oil and
nearly all of whom are part owners in
the new tank company. have given rise
to the suspicion that the new tanks will
be used only for storing oil for specula-
tive purposes.
The tanks are owned by the Oil Stor-
age and Transportation company, con-
Germ separate from the producers COM
bination though composed largely Of oil
we'll owners.
Complaint is made by some Of the pro-
ducers that there is no necessity for
these sales at less than 81. with the di-
minishing flow, if the storage capacity
in sight is to be used for the benefit of
Oil wells and not for spectators. as has
all along been claimed.
Dollar oil should be possible now If
at any time, according to those who fear
that they have been steered up against
the formulative period of large oil
corner for the private benefit of some of
the trustees and others.
J. A. Graves, president Of the trustees,
and one-tenth owner of the storage
tanks, also represents the Puente Oil
company, Of which his brother is man
ager. According to reports met with
yesterday. Graves is in favor OF less
price than 81 per barrel for oil, because
the Puente Oil company is under con-
tract to the Chino sugar refinery for all
the oil they may need at IS cents for
heavy oil and 81 per barrel for light oil,
and their supply is said to be so insult
ficient for the Chino needs that they
have this year had to buy between 10000
and Is, 900 barrels of Los Angeles oil.
Ed Strassburg, general manager for
the trustees, denies this emphatically.
THE Puente OIL company" he says,
"have plenty Of oil for the Chino people.
and besides that they have just finished
that contract. They had to buy two or
three thousand barrels last summer dur
ing a shortage Of oil. but that is all, and
]. A. Graves is also interested In the
SLOGAN Oil company, with an output OF
5000 to 10000 barrels, which would GER
tainly make him prefer a high price
than a cheap one for oil"
3. Baruch, another of the OIL Pro-
ducers' trustees, represents the Capital
OIL company, whose product Is said to be
all contracted for until after January l..
A. A. Hubbard, Of the City Brick COM
pany, liz accredited with the same con-
dition. L. G., Parker of the Merchants
Oil company is reported under contract
until February list. Joe Mater, of Maier
& Zobelcin, Is also under contract for his
oil. T. A. O'Donneil is said not to be
under contract, nor is DR.. W. A. Lamb,
the remaining trustee, who was elected
to succeed DR.. Book three weeks ago.
These men are all trustees of the Pro-
ducers' combination; nearly all of them
are part owners of the tanks and have
money to speculate with, and are said to
have no oil for the cheap sales.
Another complaint is that they do not
meet often enough, no meeting having
been held since Trustee Lambs election.
and that they leave the management of
the business entirely to President
Graves and Manager Strassburg. The
big sales of the past month are said to
have been sold without consultation with
the trustees. Secretary Strassburg,
however, says that no important sale has
been consummated by himself or Mr..
Graves without consultation with and
the full sanction of every man on the
board of trustees, and that Messrs.
Maier, Baruch and O'Donnell, among the
trustees, all furnished part of the large
sales at less than the dollar price re-
leIIco ".
OF several trustees called up by phone
last night, all but one knew of the sales
above cited. One, however, declared
himself ignorant of the 10000 barrel sale
to the Standard Oil company, but ex-
pressed full confidence in the secretary
and president of the trustees.
The story of the Generalization of oil
prices here. as told by prominent pro-
Queer to Herald reporter yesterday is
in effect as follows:
1.-THE Producers combination started
out with a surplusage of 10000 to 40, 900
barrels per month to provide for, and
the declared determination to raise the
price of oil to 81 per barrel, and keep it
there. They promised sales at that
price, but made none except at cut
rates. They cut that price right along.
They sold 10000 barrels last month to
the Santa Fee at Is cents, at the wells;
20, 900 barrels more to the same last week
at Sc cents delivered, which Is only
three cents better price, as it costs seven
cents per barrel to deliver, and now they
have sold 10000 barrels to the Standard
Oil company at rs cents, in spite Of their