, 1922-03-16
BY JOHN p. HERRICK
Oleun. New York;

Durszs tho past 20 days I have
talked with mani OF tho leading oil
men OF tho country. including Mark
L. Requa OF California. director OF
the oil div1rsoi of the government
during b RAJ n OF h best pest
ed men on oil Affairs In tho world.
During the past week I have talked
freely with heads OF the big eastern
oil producing and refining companies.
with officers OF the big companies
operating in Wyoming. Texas. Okla
homa and Mexico. with the directing
head OF q big European oil company.
The immediate outlook as I see II
through the eyes OF these men I have
talked with is hat there should be
no further reduction "a the price of
crude OIL And It I. afe 20 asert
that there VIII not be unless more
big pools like Mexta arc opened with
in a few months. or reckless drilling
campaigns arc started in the south
west Except IN tho region OF gusher
wells there Is only . small profit IN
leases in the eastern fields show no
profit today.
Surplus OF Oil.
The trouble Just now seems to be
a surplus of Oh Perhaps IL Is under
consumption of refined products rather
than owe production of crude. For
Instance. in the greatest light oil neid
in the United States they are pro
rating runs on a 20 per cent basis
for tho reason that there IA not a
market available for tho refined prod
ucts- A largo amount OF oil Is also
goinS into storage In West Virginia
no dominant producing company has
recently completed seven so.o0o-bar-
rel tanks to store Pennsylvania grade
crude and the company has cut its
dividend in two in order to avoid Dor
rowing money to pay for the STORED
OIL Tho cheapest and safest place
TO store crude on Is IN the earth
In Texas. Oklahoma and Louisiana
new storage Is being steadily erected
to take caro- Of the surplus on that
Is daily flowing to tho surface from
the new pools. The tanks at storage
points along the pipelines that lead
north from Texas and swing around
to the eastern seaboard through
Ohio. New York and Pennsylvania
storage that has been empty for n
long tlme-is now being filed. In
Wyoming II is reported hat a big
producing company will erect large
tank farm In tho Salt Creek field, In
order that the flow of oil from wells
o the company's acreage can be
cared for on top of the ground
Refncries Starting-Ep-
In Oklahoma only about IS OF the
100 renneries are in operation. Down
through western Pennsylvania some
OF the independent rehneries that
have shut down for some months arc
starting up on a small scale which II
Is hoped viii gradually be increased
as market conditions improve This
shutdown of rsfneies has been a
~ood thing, for It has kept down the
surplus stocks of lubricants and fuel
oil that otherwise would have piled
up even higher than they have in
storage tanks and warehouses. One
of the big Wyoming refining comps
niles has just closed n contract for
the sale of $500 barrels of fuel oil a
day to two big railroad systems This
was possible through converting the
refinery boilers from oil burners tc
natural gas which is piped 90 miles
across the desert. The railroads have
heretofore used coal for fuel. not be
ing able to count on a continuous sup
ply OF fuel I'll
Cooperation in on BUSINESS
The biggest word in the d~ictionar,
today is cooperation and Of late 4
Is being applied to the oil business
The larger companies N exchanging
rights to patented processes used il
refining, cooperating in testing on
new wildcat areas and In tho develop
ing OF foreign sources of supply o
crude OIL Tho recent invasion of TIL
American oil fields by a foreign com
pany through tho taking over Of ar
American company with a number o
large producing subsidiaries is az
event of unusual interest to American
oil men, The great thing for tn,
American companies to do is to keer
the ource of raw material out of tn,
hands Of foreign oil companies.
In Mexico.
| Tho best posted men say there Il