Los Angeles herald., 1907-08-12

range OF profits and, or course, cor
responding extreme range of net
prices. Similar inequalities in local
prices appear in the gasoline business
of this company.
The data from other sources, mainly
from prices reported In December,
1904, by over 500 retail dealers through
out the country, show even more start
ling determinations in prices, wholly
unexplainable on any other theory
than that of the differences in COM
petitive conditions and the use OF a
monopoly power. These discrimina-
tions are shown in several ways.
Taking the average prices for the sew
eral states In December, 1904, the low
est price appears in Delaware, ~
cents per gallon, freight deducted. and
the highest in Colorado, 1862 cents per
gallon, freight deducted, or more than
twice as high.
Part of the difference In this case is
due to higher cost of refining and
marketing Of the Colorado oil. The
difference in cost cannot exceed 3h
sents per gallon, which explains less
than one-ha.f of the total differences
Of 81 cents difference in the price. In
several other Rocky mountain and Pa
cifc coast states the average price OF
Illuminating oil. less freight, for De-
cember, 1904, was over 10 cents, as
compared with IT in Delaware, freight
deducted.
There is some difficulty in compar-
ing average state prices, even AFTER
deducting freight rates, arising from
the uncertainty as to the relative
cost of manufacturing the oil sold in
different states. This difficulty, how
ever. may be avoided by comparing
only those states which are supplied
from a single refinery or from a
group of refineries using the same
crude oil and having substantial
similarity of conditions.
Thus the range of state averages in
the states on or near the Atlantic
seaboard is very wide. In December,
1904, the average price in Delaware,
less freight, as already stated, was ~
cents per gallon. In Pennsylvania 1t
was 81 cents, in New York state 10
cents, in North Carolina and New
Hampshire 1913 cents, part of South
Carolina la cents Florida 1913 cents,
and part of Georgia supplied from
the same source 10 cents. all with
freight deducted. The figure for
Georgia is SO cents higher than that
for Delaware.
In the area supplied from Lima.
Cleveland, and Whiting, three refin-
cries operating under similar condi-
tions the prices, freight deducted,
range from S5 cents for Ohio to 1877
cents for part of Arkansas.
California Suffers
One of the most striking instances
is in California, where the Standard
carries oil from it's great refinery
near San Francisco, several hundred
miles by water and rail, and sells 1t
in southern California for several
cents less than is charged for the
same oil in San Francisco. The aver
age price, freight deducted, for south
ern California in December, 1904, was
10 cents, and the average for the
northern part of the state was 1874
cents. Oregon, supplied from the
same source. paid the price of 1853
cents, freight deducted and the state
of Washington 1871 cents.
That these differences in prices are
not due to differences in cost of mar
keting arising from the density of
population, Is shown by taking the
prices for large cities in different
parts of the country. In the north
Atlantic division, prices, freight de-
Quoted, ranged in 1904 from rs cents
at Worcester, Mass, to 1.3 cents in
Jersey City, N. j. (at the very door
of the great Bayonne refinery of the
Standard); in the south Atlantic d.
vision, the range is from 7.S cents at
Richmond, Va, to 1875 cents at jack
sonville, Fla. north central division,
from ga cents in Cincinnati, Ohio, to
1914 cents in st. Joseph, Mo-; south
central division. from ments in New
Orleans, La, to 14.5 cents in Little
Rock Ark; western division, 81
C-I n
cents at Butte, Mont, all with freight
deducted. Very little of the differ
ence in price among cities in any one
of the divisions is due to differences
in cost of refining.
In fact, even as between cities or
states most widely separated, only
small fraction of the difference in
price, after deducting freight, can
be explained by differences in cost
either of marketing or of refining.
The rest is due to consistent and
wholly unjustifiable policy of price
discrimination against noncompetitive
localities.
Even in towns in the same state or
same vicinity these wide discrepan-
cies occur. In the east Texas and
Louisiana division of the Waters
Pierce Oil company in August, 1908,
the profit between delivered cost and
selling price on brilliant oil in tank
wagon and bulk ranged from 1872 to
$50 cents, and in August, 1904, it ranged
from 069 cent to sos cents. In the
south Texas division of that company,
on the same kind of OIL delivered in
iron barrels, nine towns had profit
margins below cents, and twenty
one towns had margins aboveR6 cents
in April, 1904, and similarly Striking
T..
vidual divisions.
Another Interesting comparison is
that showing the lowest and highest
prices within given states. In Arkan-
sas the difference between the lowest
and the highest prices In December.
1904 freight deducted, was 76 cents;
Colorado, 81; Idaho. So; Louisiana,
SIS; Missouri, IA; Montana. 40; New
Mexico. 1872; Illinois, A. Kentucky. 4.3;
Minnesota, AS; Ohio, AS; Tennessee,
AZ cents.
Imposes Highest Prices
The evidence is absolutely conclu-
sive that it Is the policy of the
Standard Oil company to take full
advantage of all non-competitive con-
ditions to impose the highest prices
possible. and to extend such non
competitive conditions by aggressive
price cutting calculated to drive out
rivals. The enormous profits secured
over most of the country enable the
Standard To carry ont this Dlan very