San Antonio light. [volume] (San Antonio, Tex.) 1911-1993, 1923-08-26
RECOVERY Of
CRUDE SHOWS
SMALL | 0SS
Effects of Curtailment Pro-
gram Beginning to-
Be Felt.
OIL IS PRIOR A 7 ID
Fear Spread Of Program
Will Jeopardize Crude
Prices.
OIL IS PRORATED

With losses reported from the light
oil areas Of the Mid-Continent and nc
further increase shown in the daily
average output of California fields
| the recovery of crude oil in the United
| States for the last week clearly re-
fleets the efforts of curtailment. The
production of all fields for the week
averaged 1924, O66 barrels a day, or
decrease of approximately 10000
barrels as compared with the previous
seven days.
This appreciable decline in the out
put of the country while offering some
encouragement, was overshadowed by
further restrictions in pipe line ac-
ceptances and the announced intention
of the larger companies to start work
on the largest drilling campaigns yet
heard of.
In the new Corsicana-Powell section
operators failed to make an agreement
on drilling new wells and the big con-
Germs have thrown off the lid and are
to drill all offset locations as fast as
possible.
Fight Is BEGUN.
Oklahoma operators have started
their fight in the Tonkawa field with
increased drilling activity, and the sit.
uation there is now one Of watchful
waiting"
Contrary to all expectations, Mid
Continent light oil remained unchang-
cd in price during the last week. How
ever, in the coastal country. a 20 per
cent reduction was made in oil COM
ing under the heading of class A. 1t
is general opinion that this slash was
made in an effort TO abolish the grad
ing system in the Gulf Coast and to
buy all oil offered at a single price.
In the Mid-Continent producers
were looking for reduction as a re-
suit of the drastic changes made in
the refined market recently. Since the
cut did not have effect upon the crude
price structure, operators were nom
plussed as to just what to expect.
Oil Is Prorated.
Further restriction in purchases
were put into effect by the Texas En-
pire. Humble and Prairies companies
during the week bringing the schedule
to the following figures:
Prairie Pipe Line Company, 1910
per cent.
Sinclair Crude Oil Purchasing, 40
10 yer cent.
Gulf tincluding Gypsy Oil Com
pany), $3.50 per cent.
Texas Company, 30 per cent.
Magnolia. 1850 per cent.
Empire, 20 per cent.
Cosden Pipe Line Company, $40
per cent.
percentage figures represent that
portion of the production of wells TO
which lines are connected that actual
ly is being paid for. In most in
stances all of the production is being
handled and the remaining part of it
stored for account of the producer.
This spread of the proration pro-
gram is having determined effect on
the crude market as whole and Is
seriously jeonardizing the stability of
what remains Of the price structure in
the light oil area of the Mid-Conti-
nent. Every time the pipe line COM
panies further limit the amount of oil
they will buy from connections. so
much more crude is made available for
open market consumption, that is if
a buyer can be found, and this usual
ly means that the producer is willing
to sell that part of his production that
the pipe line will not take for price
that will move his product and not in
accordance with the posted schedule.
Bootleg prices are thus given impetus
and today this practice is becoming
more widespread throughout the Mid
Continent territory.
1t is believed that this practice of
hootlegging crude that has been turned
down by the regular purchasing agen-
cies. that will lead to break in the
Mid-Continent> light oil market de-
spite any efforts that may be made
to maintain present price levels.