The Oroville weekly gazette. [volume] (Oroville, Wash.) 1905-19??, 1920-02-20
THE OIL SITUATION.

f. r. Kingsbury, president of the
Standard Oil company California;, Is
sues the following statement:
| Instructions have been isued to all
agents of the Standard oil company
California; to take no contracts for
the sale of fuel oil without referring
to the home office in San Francisco.
At the same time 1t has been decided
that expectations of refined products,
already materially curtailed, shall be
kept at a minimum and ). only such
as to meet the company's contractural
obligations.
The condition Of the petroleum in
dustry which has necessitated these
actions is one which so closely and
importantly touches the Interests of
the public, industrial and otherwise,
that description of it will be useful
in gaining thorough understanding
of the situation which exists. In its
simplest terms, it Is that the crude oil
production of California is not suffi-
cient to meet the demands
California was called -Hpon In 1919
to supply approximately ATS million
gallons of napatha products. This
quantity could not be obtained from
the production of crude oil in Califor-
mia and the shortage of ffOyer twenty
million gallons was imported from the
east. With the demand for gasoline
and heavier fuels in direct proportion
to the number of internal. combustion
engines, embracing automobiles,
trucks, tractors mariner motors and
pumping plants and the production of
this class of equipment constantly in
creasing, the 1920 demand for naphtha
products it is estimated,s twill! exceed
the 1919 demand by at s,east .25 per
cent. indicating a total requirement of
six tun.,red million gallons. From the
present supply of crude 'pil, the total
possible production of naoE.ha pro-
ducts is but four hundrel and fifty
ni:Iion gallons. indicating a shortage
in the products named + i5o,ooo,ooo
gallonS
Will, Heretofore gasoline has been
purchased in the Middie Continent
rieit,, SUI. p,a. CHASED nus. -ocAssar.nv
be made on a competative basis with
eastern buyers. The wholesale price of
gasoline in the Mid-CoHtinent field
today, at points of manufacture, are
Is cents to 10 cents per gallon. Add to
this price cents per galsous the cost
of bringing the product 10 the coast
in tank cars, and this gakoiine would
sell at San Francisco y 1lAstweea-i25
cents and 30 cents per gallon, as
against the present price of 81 1-2
cents per gallon.
duction and consumption. Today the
crude oil production of California is
$1,000 barrels daily less than the re-
quirements, and the deficiency for 1920
at the present rate of production will
exceed 100000 barrels. Since 1916
stocks have decreased $4,000 900 bar
rels which means that the public con-
sumed that quantity over the. amount
produced. Stocks Of crude oil on hand
today of 30,000,00O barrels are lower
than at any time since 1910 and Of this
quantity it is estimated, only $4,000, 900
barrels are required as working
capital, or so to speak, "as merchan-
disc on the shelf, and the remaining
100000 barrels are in pipe lines and
tenk bottoms and entirely unavailable
This company has been successful in
increasing it's production Of crude Oil
In 1918 the increase was four and one
half million barrels over 1917, and in
1919 three million barrels owe. 1918
but even these considerable increases
ON the part of one company do no: save
the situation. In view of the $ lortage
existing, the company has Increased
the prices it offers for refinable crude
oil. Other purchasers Of refinel crude
Gil have been paying large premiums
over the prices offered by the Standard
Oil company.
The remedies are increased prOduc.
tion and importations, and to a lesser
lextent but quite as important, conser.
walton and the elimination of waste by
careful and scientific handling of pc.
troleum and its products by the OF
industry on the one hand, and its sci
entific and careful use by the public
on the other hand.