Evening star. [volume] (Washington, D.C.) 1854-1972, 1922-11-01
PLAN TO CUT OIL
PRODUCTION FAILS
Supplies Have Piled Up
Steadily Since Last Price
Reduction.
BY J. C. ROYLE.


special Dispatch to The star
NEW YORK, November Tine Pc
troleum Industry is not yet ready. tor
the poorhouse, in spite OF continued
low prices for crude oil.
Oil refneries throughout the coun-
try are today running practically az
capacity. Nearly 1,660.ooO barrels oil
crude oil a day are being run through
the stills. These have theoretical
capacity of 1.736. 900 barrels daily. but
il is always necessary to have some
units idle for cleaning. so that pres
.nt operation in reality represents ca
pacity output.
OIL Production Jumps.
Domestic production. has risen
steadily throughout October. in spite
of the immense reserve STOCKS III
storage. and in the last week mas ap
preached 100000 barrels uay.
drastic efforts to curtail domestic
production since the first inportan.
cut was made in crude oil prices last
July have failed so far STOCKS on
hand were per cent greater on octo
Der 1 than in July and -, per cehs
greater than at the first of the year.
Consumption in this country Is
normally greater than domestic pro-
duction. the deficit being made up
by imports of Mexican oil. In the last
four months imports of Mexican OIL
have been steadily decreasing and
were about IS per cent less than in
the previous four months.
Heavy Surplus supply.
Consumption and production. taking
the Mexican imports into considera-
ton, now are nearly equal. The OIL
Industry would face no problem were
II not for the excess stocks in storage
which at present amount to about nve
and half months consumption. IL is
probable that imports of Mexican OIL
will decrease still further and that
consumption will increase to such an
extent as to allow liquidation grad
ually of the huge reserve stocks.
Some midcontinent field operators
IN a few cases have deliberately
brought in new wells In the hope OF
canning some slight advantage before
another possible cut in crude prices
should go into effect, but In general,
drilling operations are declining
sharply. California Is the chief Of
fender in development Of new pro-
duction, and is now accounting Tor
- per cent of the entire domestic
flow Operators there offer as an ex-
cuse the development Of foreign ex-
port business.
race Huxc bOSSVS-
Crude oil prices can be still further
depressed, if necessary, but indications
now point to a decline in output, ac-
cording to reports from oil centers
received today. If conditions are not
altered large holders of crude face the
prospect of huge paper" losses and
some refiners and producers will SUI
fer actual loss.
Gasoline prices are weakening
slightly as 1t natural at the end OF
the motoring season. kerosene prices
are rising. as expected. with the ap-
proach of winter. The advance In
fuel oil prices in this section predict
ed by many oil men came just before
noon today.
All family flour prices have been ad-
vanced 20 cents a barrel in parts OF
the Pacific northwest. and some mill
lers there also are advancing export
grades. Still further increases are
forecast due to the scarcity of the
harder wheats in the northwestern
states.
Potato Prices Low.
Production of potatoes is estimated
at 433,o0O,000 bushels for the coun-
try. and demand is slack and prices
low Northwestern railroads are con-
sidering a reduction in freight rates
to growers to enable them to get some
margin of profit from their potato
crops.
The increase in industrial opera
lions throughout the country Is indi-
Gated by the growing sales of betting
and power transmission eQuipm emit.
Leather markets are quiet as both
buyers and sellers are in complete
disagreement as to price trends.