The Morning Tulsa daily world. [volume] (Tulsa, Okla.) 1919-1927, 1921-10-12
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Peculiar Situation in
Crnde oil Market

perspective Of the crude on
mako. situation today Is consider
ably different to what It was two
week. .ro. before the campaign Of
boosf.... began. and situation
vo.. ...ra different from any time
IN Tho history OF the oil business In
OtnIomt
VII. line fields Of Burkburnet,
ard Ranger were discovered In 1917
a. th.. .n,cinning OF the war the big
sorparIas extended their pipelines
s,YtH into these wonder fields and
hogan taking oil from north and
central Texas along with the OKLA
boma crude into their big trunk
lines running to the north and east.
Al that time there was no distinc-
Uor I'm the price OF the crude taken
IRON the two states. and It was gen
era.N understood that they were
Of equal value.
Tho developments Of the last two
veeks have upset this former ar
rangcmrnt completely as now tho
general price 81 Oklahoma oil is
$50 per barrel. while the quota
lions f1r north and central Texas
Is SiI5 per barrel,
ryan I'm oklahoma tho equiib-
saurdsy the Gulf Production
company announced a price distinc-
,inr I'm the purchase OF crude, mar
t.rg lno market for oil testing rs
gravity and above up TO Si.76 per
barre, and leaving the common
grades remaining at $50.
Therefore. In this district OF tho
Nld.Coutncnt field, commonly con-
slderpd governed by the same con-
dltions and prices. there now exis's
three prices: Texas oil bringing
si75. rs gravity Oklahoma crUd %
brirg.ng Sl.7J to the Gulf lines. ant
other oklahoma oil quoted nj $l.50
a barrel
During the past six months, In
which time the independent refin-
er ln oklahoma and Texas have
stepped In and taken all the high
gravity connections away from the
larger purchasers hY the pavmen'
OF large bonuses, many tar-sighted
oil men have forecasted that the
fine was coming when the larger
companies would hsvc 20 go into tn"
fieA In com petition with the inde.
pendent rpfiners for this high grav-
ity oil which would result In n
marginal market, based upon the
quality Of the crude purchased.
Interviews With some Of the larg-
or purchasers Of OH bring out tho
tact that a general adoption of the
r-avi'v rpsis f0r purchasing crude
IN this state does not seem to be
ir 'avor. THE united opinion eX.
pressed by these men brings out th'
following objections to the gravity
basis: The percentage OF higf
gravity oil available to the large
pipelines, even on 20 cent margin
would be 30 small that It would not
bolster up the gravity OF the aver,
age pipeline oil tn an extent tha
Il would be profitable: the adoption
OF such a gravity buying system
would result in a very complex sys
TEN Of testing, necessitating the en-
plcyment of a larger field force u
insure the exact testing Of all crud'
purchased: and II would be an un
satisfactory arrangement 10 the oi
business at large, working in a wa
a hardship upon the small refine
by increasing the price he woub
have to nav for his oil and at tn
same time being unsatisfactory 4
the average producer. whose scat
tered production all over the stat
Is comprised In the main of 10,
gravity oil with few scdttere
pools OF high gravity stuff
Z However, at the present time
gravity distinction is in existence a
Z regards the Texas crude, and on
p OF the Oklahoma companies Is put
chasing oil on such a bnsis. y
doubt. the trend seems to be In IN
direction OF the adoption Of such
basis generally. but II would Ger
tainly take super-man to toreca'
how the mlXup viii turn out.