Evening star., 1932-06-26
INCREASE IN OIL
DRILLING IS NOTED
Advance in Fuel Prices Has
Caused Gain in Prospect
ing Operations.
BY BRADLEY w. TRENT.

Special Dispatch to The Star
NEW YORK, June 25.-The increase
in oil well drilling recently indicates
that some producers fail to consider
facts fully before making decisions
These drillers perhaps do not realize
that there is a potential oil oversupply
without more wells. They are proceed
ing on the assumption that increased
consumption this Summer will call for
additions to present actual and poten-
tial production
Statistics indicate, according to
survey made by Standard Oil Of New
Jersey, that for the first time in his
tory the oil business this year will sell
a smaller quantity of products than in
the preceding year.
Car Registration.
Despite the new automobiles going
into service the company announces,
the number of cars registered in the
United States is now about 1000, 900
fewer than it was on the corresponding
date last year. This fact and the
smaller mileage per car due to the i'm
poyerishment of so many owners make
it probable that there will be a decrease
of at least 6 per cent and possibly as
much as Is per cent in the consump-
tion of gasoline through the remainder
of this year"
In view of these facts, Standard Oil
Of New Jersey questions the wisdom Of
the April l oil advance, because that
price revision caused the number of
rigs and wells drilling to be increased
by 17.8 per cent by June l.
Oil securities have pointed upward
because Of slight improvement in earn
ings during the second quarter. This
IF frpr1d fnl1Ou-c turn nf
liquidation. At the end of 1929 the
market valuation placed on shares of
81 outstanding domestic petroleum cor
porations was $7,419, 922 ,062, or about
1917 times net earnings Of $602 $40, ,827.
At the end of 1880 these stocks had
market valuation of $4,631, ,218,622 and
net earnings were 1928, ,429, 1853. At the
end of 1881 these shares were valued
at 81, ,309, AT ,568 OF the 81 companies
only IL have thus far reported in 1882
and each shows that it operated at a
net loss. The market valuation of
these 81 oil stocks today is but 81 per
cent of what it was in 1929.
On this basis, the grand total of
capital invested in the American pc
troleum industry, popularly estimated
three years ago as being between SILL
O00.00O,0 900 and $4,000. 100000, is now
appraised by the market at less than
81 900 100000.
Position of Industry.
Glancing at the current statistical po-
sition Of the industry as cited up to
April by Standard Oil Of New Jersey,
the following favorable items stand
out: Daily average United States crude
production in April was 2,257,000 bar
reIs. or 10000 less than in April, 1881,
United States crude supply in April
was 2.513,0 900. or $4,000 barrels less than
In April, 1881.
Total stocks of crude and oil products
of 636, ,019,000 barrels in April we're 33,-
$4,000 less in April, 1881. Daily aver
age crude run to stills of 2,371 900 was
down 121 900 barrels from April, 1881,
and motor fuel production of 1,144,000
was off $4,000 barrels Wells drilling
numbered 2.25l, or off 1877.
Many of these factors help to explain
the improvement in prices of various
oils and oil products. The average price
Of SO degree midcontinent crude in
April was 81 cents a barrel, or % cents
more than a year ago. United States
motor gasoline was 4.57 cents a gallon
in April, or up 1.29 cents over April,
1881. Average tank wagon price Of
gasoline, so cities, ex-tax, first Of April,
was 1910 cents, or up 061 cents.
Copyright, 1922