Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-01-25
BETTER CRUDE OIL
|. MARKET INDICATED
Hopeful Sign Is Seen in Offer
of RefinerS to Purchase
Supplies.
BY L. Nj. LADET.
Special Dispatch to The Star.


TULSA, Okla, January 24.-Possi-
bility of a larger market for crude oil
in several of the fields of the mid
continent region is indicated. Several
refiners during the last week have
promised producers pipeline connec-
tons to some of their properties which
heretofore have been lacking in outlet.
This trend, although quite reversal
from recent developments, is the re-
suit, it is believed, of the serious con-
traction in production in Oklahoma and
Kansas as well as the more favorable
crude oil market to the buyer.
OIL Purchases.
Relief was expressed over the atti-
tude of such companies as Magnolia
Petroleum and White Eagle, subsidiaries
Of the Standard Oil Co. of New York,
and also the 'Stanolind Co., sub
sidiary of Standard Oil Co. of Indiana,
as revealed in their notifying some of
the producers In several Kansas fields
that the full production of their prop
critics would be purchased. It is indie
alive that companies of that type are
perhaps unwilling to reduce further
their inventories on the present market.
Then, too, refiners begin at this time
their preparations for the increased
consumption Of motor fuel which ordi-
narily begins within the next four to
six weeks. They will unquestionably
consume more crude oil during the next
few months. And it is advisable to
locate an additional supply II the large
flush fields are to remain prorated at
the present rate.
Depletion Item.
There Is also the item of depletion
of several of the large flush fields to
consider. While the oil potentially OF
the country Is reaching dazzling heights,
1t has become increasingly noticeable
that recent gauges OF many OF the
properties in the newer areas have SUI
fered a considerable decline. On the
gauges that are now being taken in
Oklahoma City larger number OF
properties have declined some 20 per
cent from the previous month. 1t is
difiicult for any one but the technolog1st
or statistician to understand potentials,
as the recovery Of oil Is oftentimes
overlooked during the presentation OF
an array Of figures hctitiously repre-
senting the daily possibilities OF an
area.
The Oklahoma City pool. although
considered as shut in because Of the
small production as compared with the
and has already produced 100000
barrels of oil. A dozen properties have
produced more than one million INxrels
of oil. of which two have exceeded
$500 900 barrels.
While no further price cutting in the
crude oil market has occurred. there Is
a differential of to % cents bar
rel on oil produced in Texas and that
which is being produced in Oklahoma
and Kansas. It may be that crude Oil
buyers are awaiting the outcome OF the
Oklahoma City wrangle. BY vote OF
two to one the operators are seeking
q revision of the corporation commits
sion to 10 per cent Of the potentials.
This would increase the production OF
the pool to SOC, 900 barrels a day.
Storage Facilities.
In view Of the limited storage facili-
ties, production Of such an amount OF
oil would create a very large quantity
of distressed oil which would temporarily
affect the market Therefore any ad-
justment in the crude market at this time
certainly would invite further revision
later on should such development ma
terialize.
For a crude oil buyer seeking stabili-
cation the current situation presents
many cratic turns. 1t was not aided
by the appointment by Gov. w. H. Muir
ray of an oil legislative committee,
composed Of nine members, OF whom the
majority Is against proration. The
Governor said that he would feel abso-
lutely safe in urging passage by the
Legislature Of any remedial bills TINS
committee can agree on"
(CopyriRht. 1891