New-York tribune., 1918-07-18
Premium Plan to
Stabilize Oil Prices
Petroleum War Service
Committee Makes Trade
Recommendations

Payment of certain premiums above
the posted Prices of crude oil was rec
commended in a plan for stabilizing
prices in the Appalachian, Mid Cont
nent and Gulf coast fields submitted
last night to NJ. L. Requa, director gem
eral Of the oil division of the national
! fuel administration, by A. C. Bedford,
chairman of the National Petroleum
War Service Committee, representing
the oil industry.
The plan, which is to remain in force
until November l, also is intended to
assist the continuous and uninterrupted
flow of oil through its present channels.
Although the committee extended its
inquiry to the Rocky Mountain and Pa
cific Coast oil fields, no recommendation
will be made for them at this time.
Repeated advances in crude oil prices
and the fact that tempting premiums
above posted rates were being offered
to producers met with a fuel admin
istration rebuke several weeks ago. 1t
was declared that the government would
look with disfavor upon any attempt to
further advance prices.
To evolve some system by which the
OIL producer would be justly treated
and the refner would be able to secure
raw materials, the National Petroleum
War Service Committee was asked by
MIR. Requa to give the question careful
consideration. This committee investi-
gated conditions, and the plan outlined
tonight is the result
, Expects Oil Industry to Aid
In his letter to Mr.. Requa, Mr.. Bed
ford expressed belief that the oil
industry would conform patriotcally
and Loyalty to the recommendations"
and suggested that Mr.. Requa visit the
mid-continent and Gulf coast fields,
and meet personally the producers
and refiners before acting on the
recommendations, so there may be the
fullest understanding on all the
phases governing the situation.
The committee recommended that the
large purchasing companies in the
Appalachian and mid-contnent di-
visions continue to purchase crude oil
at their posted market price, and that
all other purchasers who now pay a
premium be hereafter permitted to pay
premium" which in the Appalachian
district shall not exceed ten cents
barrel and in the mid-continent field
shall be rs follows:
J For Gushing crude q maximum pre-
MUM of IS cents per barrel for Gar
Der and all Billings crude a maximum
, premium Of 81, for Kay County crude
maximum premium of 60 cents, for
Healdton crude maximum premium of
80 cents
! For all other crudes for the whole
mld-continent division, including Kan
sas. Oklahoma and Northern Texas, a
maximum premium not TO exceed %
cents barrel would be permitted, with
the strict understanding that in no
district in which premiums are being
paid of less than 20 cents a barrel
will the oil administration permit the
paying of a higher premium than is
now in effect
Gulf Coast Recommendations
Recommendations for the Gulf coast
and the Northern Louisiana division
were as follows: 'That the large pur-
| chasing companies in the Gulf coast
territory be requested to establish a
posted price for crude oil of $3.50
barrel and continue to pay said price
until November l. 1918, and that
maximum premium be established
above the posted price of 10 cents
barrel, with the strict understanding
that in no district in which premiums
are being paid of less than 10 cents
barrel will the oil administration per-
nit the paying Of a higher premium
4 than is now in effect
THAT a differential of 25 cents
barrel be established between the Gulf
Coast oil and Northern Louisiana heavy
oil below "a degrees gravity, and that
a premium Of 10 cents a barrel be per-
mitted on this grade of oil; that on
light crude oil a premium of 25 cents
barrel be permitted, with the strict
understanding that in no case where
premiums of less than 10 cents and
25 cents barrel respectively have been
paid will the oil administration permit
the paying of higher premiums than
are now in effect"
The committee also recommended
that no oil buyer be permitted to take
away from any other buyer such runs
of oil as the latter has been receiving
without first securing the consent of
the oil administration to the transfer.
This does not apply To production
owned or produced by purchasing com