The sun. [volume] (New York [N.Y.]) 1833-1916, 1902-01-05
PIPING RUSSIAN OIL
The Transportation OF Russian Petroleum
TO lie NcNolntiOniIcd.

The Russian Government has undertaken
the completion Of the pipe line by means
Of which refined petroleum is to be piped
from Baku on the Caspian Sea to the Black
S,a port Of Batum. a distance OF SIS miles.
The Government expects to mako money
out Of tho operation Of the line: but the
order issued recently to begin work on
the 400 miles that still remain to be built
declared that it was the intention OF the
Gar 70 help the Russian petroleum indus
try to compete in the markets Of tho world
1t ia likely therefore that to accomplish
his purpose, If possible, the Government
will be content with q moderate profit.
In 1900, Russia supplied only a little over
onc-third Of the expert Kerosene OF the
world The. United States supplied nearly
all the rest of II, for all the other producing
countries export very little or none at all
and some Of them do not produce as much
az they consume. But though VIC sell
about twice as much refined petroleum in
foreign markets as Russia sells, the latter
country produces as much crude oil as we
do and sometimes more. This is explained
by the fact that while we turn most OF our
crude oil into kerosene. Russia turns the
larger part Of her crude oil into naptha
or uses the unrenned article for fuel.
The Russian oil producers declare that
il is not their fault that they have only a
comparatively small ehare in the worlds
kerosene trade. They assert that they
could compete with American oil In every
market Of the world If 1t were not that
Russian freight rates 70 the seaport OF
Batum are very high, while the means
OF transportation are insufficient. They,
therefore, cannot get enough oil into the
international markets TO compete with
their American rivals; and even could they
do so the cost OF transportation from the
n~eighborhood Of Baku to Batum, by rail,
is so high TINT thoy are placed at a great
disadvantage in the competitive trade.
The Baku-Batum railroad has a double
track for only two stretches OF lo2 miles
altogether and its capacity FOR OIL trans
portation is only about 400 900, 600 gallons
a year. II has rarely been able 20 carry
all the refined oil offered TO II and there is
therefore a premium on ~ransportntlon
capacity with resulting very nigh freight
rates. The railroad recently completed
between Petrovsk on the Caspian and
Novorossisk on tho Black Sea is a still
more expensive route and carries petroleum
only when the price is high and the Baku
line ia more than usually glutted.
On the other hand, the shipping facih-
tics by way OF the Caspian sea ar" unllil-
tied and the freight rates are always mucii
lower than on tho carN but the Caspian
is tho natural petroleum. outlet only To the
contiguous regions and particularly TO
inner Russia. II cannot figure ~ the great
world trade. Hence the pipe line - n
uecessitv If the kerosene Of Russia II 70
have n fair chance in the worlds markets.
The part of the pipe line between, the
seaport Of Bitum and Mikhailovo, about
no miles. has Teen In operation since NC
tober, InOD. This town lies on the water
parting between rivers Towing TO the FacN
Sea and those flowing to e." Caspian. The
Dine system has therefore len completed
In the Black Sea basin. bat thrce-fourths
81 Il, in the Caspian blsin, remains TO be
uuilt. The part of II ttat Is in operation
in tho first place, ii il not worked nearly
70 its capacity, for il can carry kerosene
no faster thar the railroad brings II from
B4ku, and in the second plloe, owing 10
the expense Of transshipntout from the
cars 70 the ripe NJ hhhallovo the through
freight rate has not been reduced q particle
The actual cost Of delivering a pood or
five gallons OF erosene at Batum Is said
TO h.. two cents AT present. IL IL expected
Tint the complrtcd pipe line will reduce
the cost 20 siN-tentls uf q cent.
American petroleum interests probably
have little fear that russian Kerosene
will become a formidable competitor IL
the markets Thus far ~ least the qualify
of Russian kerosene for Illuminating pur-
poses has not equllled hat 81 the american
product, which is sold 10 an impor'at
eStont In the better class houses even -
Dlacc her article on the markets a chc1ply
a. tho Americans do the quality 81 bussltn
kerosene must be improved before II can
an AVIAN taFp.a with oar oil.