Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-03-31
Cooperative Conservation.

The ambidextrous ability of Uncle
Sam to use both hands at once is no
better exemplified than In the spectacle
which shows him urging the Oil leaders
to curb production as a conservation
measure and Immediately investigating
to find out whether, in agreeing to
his proposal, these oil leaders are vio-
lating any provisions of the Sherman
antitrust or the clayton law. There
is nothing particularly conflicting in
this demonstration Of agility. At least,
it is sincerely to be hoped that the De-
partment Of Justice will not find any
thing conflicting
In reaching its decision last Thursday
In New York to hold oil production in
the current year to the 1923 output the
Petroleum Institute was taking a CO.
operative step in conformity with the
recommendations of the Federal Oil
Conservation Board. The action of
Secretary Wilbur of the Interior De-
partment in asking an opinion from the
Attorney General on the legality of this
step is merely precautionary, and is
not, as it might appear, hasty effort
to lock the stable after the horse has
gone. Secretary Wilbur also wishes to
know what powers. if any, the Oil Con-
servation Board may have in holding
down production.
DR.. George Otis Smith Of the Geo.
logical Survey, who attended both the
meeting in New York and previous
meeting of representatives of the oil
industry in Texas as the representative
Of Secretary Wilbur, is high in his
praise of the oil leaders, whose action,
he believes, SIS indicative of new ap-
probation of responsibility" DR.. Smith
points out that the Oil operators are in
essential agreement with the Federal
on Conservation Board, which repeat
edly has called attention to the lack Of
balance between supply and demand In
the oil industry. The excess of produc-
ton has resulted in the storage, at pres
ent, Of approximately five hundred MIL
lion barrels of crude oil above ground,
an amount that is about twice as large
as is considered necessary. The coun-
try's consumption of crude oil products
since the formation of the Oil Conserva-
ton Board by Mr.. Coolidge has in
creased about twenty per cent. But in
the same time the amount In storage
above ground has increased twenty-five
per cent.
With this huge surplus already piled
up, present production is adding to it.
While fears might be expressed as to
the effect on the price of gasoline OF
thus holding down production, more
fears should be expressed as to the
financial burden assumed by the Oil
industry in taking care Of its vast &C
emulation Of above ground reserves.
This cost is, of course, passed on down
the line, and is paid for by the con-
sumner. Shutting down on production IS
merely storing oil where nature stored it
In the first place, under the ground, and
nature charges no interest on tnat
investment. The Oil Conservation Board
has pointed that out more than once.
The oil operators are not only marching
IN step with Mr.. Hoover's announced
policies of conservation, they are
demonstrating their widely known bust
ness acumen.
If the Department Of Justice finds
that an agreement to curb production
conflicts with laws, there should be and
there will be ways to change those laws
to meet a condition where voluntary
action, not conspiracy in restraint OF
trade, but cooperation in restraint OF
waste, is necessary and desirable in the
interest Of the public.