Evening star., 1932-10-19
OIL HELD EMERG|NG'
FROM DEPRESSION
First Basic Industry to Rise,
Federal Board Tells
Hoover.

The Federal Oil Conservation Boarc
reported to President Hoover today that
the American oil business gives indi-
cations of being the first basic industry
to emerge from the world depression,
and urged the States to continue CO.
operation toward curtailment of produc-
tion to make the upturn permanent.
The board, which was appointed by
President Coolidge to keep in touch
with the oil situation and to make
recommendations, consists of four cab
met members-Wilbur of Interior chair
man; Hurley of War. Adams of Navy
and Chaplin of Commerce.
Ask Interstate Compact.
Citing recent improvement in the in
dustry, the board recommended adop-
ton of an interstate compact by the
oil-producing States as a means OF con-
tinuing on a permanent basis the I'M
provement which was largely brought
about by the compact of September,
1881, and the creation of the OIL states
Advisory Board.
Unless satisfactory machinery Tor
stabilizing the production branch Is
adopted" the board said in conclusion,
mo improvement in refining and mar
keting practices will be wholly eHectlVe,
but if constructive tendencies on the
Noduction siCe are made permanent
Corresponding improvement in the other
branches may be expected to follow
Certainly the oil industry. one major
business with a comparatively intact
market. never had a better opportunity
to serve the country. and the country
never had a more vital interest in the
purchasing power of this industry
The board attributed the improve
ment of recent months to THE fact
that for the time being production ia
all States has been more closely in &C
cord with demand than in recent years.
The oil States. with the industry's
support, have brought about this re-
suit by cooperating to see that the
curtailment has been more nearly
unanimous and on an equitable basis,
the board stated in its formal report
transmitted to the White House.
Effects Being Felt.
The effects of the industrys rising
purchasing power are beginning 10 pe
felt. They will be further manifested
during the Fall sld Winter if produc-
ton can be kept on stable basis, but
continued stability will depend largely
on the situation in the East Texas
area
The permanency of the present i'm
provement Will depend largely on
whether the State cooperation mani
tested in the production compact OF
September, 1881 tby Oklahoma, Texas
and Kansas and in the creation OF the
Oil States Advisory Committee, Is con-
tinued on permanent basis through
an interstate compact, or Is relaxed
as conditions improve"
The new Federal tax of l cent per
gallon, although described by the board
as AN additional burden on highly
taxed commodity" was declared in the
report to offer some compensation to
the industry in the opportunity for
Federal and State cooperation in elm
mating the tax evader." Pointing out
that the Federal government must
necessarily inform itself of the move
ment of gasoline. the board asserted
it should be feasible for such data to
be collected and exchanged through
central agency for the benefit of both
Federal and State governments.
Information Needed.
"Not until complete information on
all refinery shipments. intraState and
interstate, is co-ordinated will basis
be laid for eliminating the tax evader
as a major factc< in depressing markets
and decreasing State revenues, the re-
port stated. IF the damage from the
illegal source continues to increase, the
remedy may ultimately be statutory au-
thority for collection by the Federal
government at the refineries OF taxes
for such consignee States as desire to
1oin in such a program