, 1925-04-16
GAS COSTS
GO UP OR DOWN

March Issue Of the Texaco Star,
house organ of the Texas company
and ably edited by Arthur L~efevre,
had the following comprehensive an
swer as to the price of gasoline) J..
Recently The Christian Science
Monitor sent to the chief executive
OF a number of oil companies a ques-
tionnaire on the gasoline price stu
alton, and has been publishing in
serial form the swe received.
To give readers OF The Texaco Star
the benefit of the views Of President
Amos l.. Beatty we print the questions
p%ropounded to- him and his answers:
l.. Why does the price (gasoline)
go up at a time when demand is
lowest?
2. Who decides that The price
shall advance? Is it one person or
a group?
3. On what factors does the de-
cision rest?
4. How does the decider reach
his decision?
5. How is it that prices are gen.
orally so uniform?
6. If it is demand why does the
rise come when consumption is low
est?
Z If supply regulates the price
why does the rise come when produc-
ton is far in excess of demand?
s. If the rise is regulated by the
reserve stocks, why is the present
rise necessary when 1,179,5O3,1S5
gallons are in stock as reported Dec.
81, 1924?
8. If the reported reduction of
q n nm hn rra1c nrninnnI IN 1 1904
compared with 1928 is true and US
&c as a basis for the increase in price
how does the tremendous reserve
stock figure in the price advance?
That is, what should the reserve
total?
10. How far does the f~luctation
of a few million barrels figure in the
price If there is still a surplus stock
on hand?
IL. How much does Gaping of
oil wells or slowing down production
figure in the situation?
~. How is it economical and
commercially possible to maintain
rising price when profits are report
ed as high as they are?
10. If there is competition, is it
in buying from and by producers at
mounting prices rather than competi-
tive selling to the ultimate consumer
at reduced prices to get business?
IA. Is not the Sc per cent in
crease in retail price greater than the
advance in crude oil and why?
1910. The price goes up because
those who have the product can see
consumption in excess of production
mex summer and are unwilling to
sell their stocks at distress prices.
Those who know the business are not
fooled by the drop in consumption
during the winter. The stocks on
hand are a factor but only a factor,
II moreover they are not large COM
paratively. Stocks, production. pres
ent and prospective consumption
all of these are factors. Whenever
in trade and commerce we are able
to say whether 1t is time to sell or
time to hold we have reached a con-
clusion as to whether prices viii be
lower or higher. The prospect of flu
ture prices. either lower or higher,
operates upon the v~olition to sell or
hold, which in turn becomes reflect
ed in current prices. This simple test
of whether IL was time to sell or time
to hold gasoline or crude petroleum
stocks should be sufficient here 1t
is easy to see that II all the stocks
had been I'm the hands of companies
or individuals not engaged In market
ing at retail. when more thar two
months ago 1t became apparent that
we were headed for misrepresentation
and overconsumption, prices would
have advanced Immediately and
sharply. But most of the large re-
fineries market at retail. or. in a
measure at retail, thru numerous