The Daily Ardmoreite. [volume] (Ardmore, Okla.) 1893-current, 1922-07-25
STORE CRUDE DURING
PRICE CUTTING.GRAY

In a statement recently issued TO
the members of the Midcontinent Pet.
roleum association by w. II. Gray.
president of the organization the ac-
tion Of the Standard interests in making
the cuts in price of crudes Is described
In most interesting and full.of.fact
manner from the independent view
point. When the senate at Washing.
ton was planning a tariff on Mexican
crude year ago, states Mr.. Gray, the
Standard officials Immediately proceed
I'd to raise the price Of American oils
70 eliminate the prospects Of a tariff
and as result the legislators ceased
their activities In this respect. The
Standard pipe lines started to store the
domestic production at 81 a. barrel, and
continued to refine the Mexican pet
roleum. Two months ago the Sinclair
and Prairie companies had stored crude
to point where 1t was getting to be
. serious proposition with assertions
that they were unable to borrow money
with which to store the oil and that no
more storage to take care Of the runs
would be erected. Just about this time
Senator LaFollette introduced a resolu-
tion asking for an inquiry into the
high prices" Of refined products. not.
withstanding the fact that enormous
stocks Of crude were piling up In this
country while tremendous production
continued to flow in from Mexico.
Mr.. Gray predicts that the month of
June will probably record the high
point for all time
'The Standard OIL leaders know
that the producing end of the petroleum
industry is on a firmer basis than 1t
has been for more than four years,
ties Of both this country and Mexico,
and by this l mean pools In sight for
immediate development, are less than
for any similar period for five years.
They know that the world is 'consum.
ing more oilths year than any year in
its history. Then @hy do they
undertake to demoralze the crude oil
situation, knowing as they do that it
must and will to some extent unsettle
the entire refined structure? Simply
case of lame ducks and cold feet. Too
bad! too bad! Had they stuck TO their
program for another month they might
have immortalized themselves in the
eyes Of the Mid.continent producers"
The prospects of an overproduction
when the price was raised last year,
states Mr.. Gray, were menacing. At
the time of the cut this year they had
substantially disappeared. If this state
ment Is true then the cuts OF the last
few days were camouflage to fool the
government at the expense Of the pro-
ducers Or else 1t amounts to a deliberate
diabolical and concerted raid on the
independent oil producer to gather a
lot Of cheap oil.
Mr.. Gray points to the threatening
attitude Of the Mexias Haynesville and
Burbank pools as reason for indicat-
ing that there appeared more reason
for fear OF over production when the
price was raised last October than there
does at tho present time when the quo
tation Ia cut. The manner In which
these pools are now sliding. removing
the greater part of any threatening at
titude, makes the situation now an en-.
tirely different one.
Taking the combined production OF
the Mid-continent and Mexico fields as
a basis for arriving at what the true
situation OF the oil industry is in the
territory east OF the Rocky mountains
and in the port trade 1t Is found at
from the consumers and refiners point
OF view, the prospects for new produc-
tion are the gloomlest in years. On
July Is when the cut in mid-continent
crudes occurred, the production OF the
two combined areas was 10000 barrels
day less than 1t was in October, 1921.
when the price was raised to 81 and
250, 900 barrels n day less than In Feb
ruary when the price held at ~.
President Gray advises as a remedy
Immediate curtailment OF development
by the independent operator unless he
is content to sell his oil at sl.b0 per
barrel. lie believes that the companies
affiliated with the Standard interests
will do likewise and cooperate in a shut
down movement. The independent pro
ducer should store his OIL he states.
Il had ten times rather store oil at
s2 n barrel from now on till the first
day OF January, than 10 have stored II
at $3.50 from October 1921, to January
1922"
Crude now stored will bring $3.50 or
$500 barrel for the reason that the
Standard Qll group must get 'du. mucn
for their storage OIL or lose si0r.rOO..
S3 O barrel for the reason that the
900.