Evening star., 1942-10-07
Henderson Opposes
Overall Increase
In Crude. Oil Prices
Says Subsidy or Bonus Is
Better Way to Encourage
Search for New Fields

By the Associated Press.
Price Administrator Henderson ex-
pressed opposition yesterday, before
a Senate subcommittee studying pc
troleum reserves, against any over
all increase in the price ceilings on
crude oils.
The OPA chief gave his views
during questioning Of a witness be-
fore the subcommittee. A. I. Le-
vorsen, Tulsa (OklaD geologist and
oil operator.
Representatives of the petroleum
industry urged recently that there
be an increase of approximately Is
cents a barrel in crude prices as a
means of encouraging drilling for
new wells.
Why, asked Mr.. Henderson, should
there be general price increase in
oil, beneflting all the industry, sim
ply to encourage exploratory work
for new fields?
He suggested, as an alternative,
that the Government give a bonus
or subsidy of some form to those op-
orators who actually carry on wild
eating operations in search of new
oil deposits.
Capt. A. T. Carter, Navy witness,
said that by the end of 1943 the re-
quirements Of the Navy might be
double the amount needed now. He
recommended that serious consider
alton be given by the Government
to an exploration program for new
oil reserves.
Although Mr.. Henderson was not
called on to testify, he did interro-
gate witnesses occasionally, and at
one point observed:
Il think from the very first day we
recognized that production was par
amount. ''' 1 have supported ex-
pansion from the beginning"
He said his policy had been to
encourage production of coal, steel
and other commodities essential to
the war effort.
Charles F. Roeser, Fort Worth.
Tex. member of the petroleum
industry war council, advocated a
rise In the price of crude oil both
to provide funds now to carry on
more exploration work and to fur.
nlsh the reward incentive for con-
tinued future Efforts
Mr.. Roeser said that a request for
higher crude oil prices was before
the OPA for more than Is months
put that agency under it's policy to
prevent any price increases has re-
peatedly refused to recognize the
necessity for higher crude oil prices. "
Sharply Increased Demand.
The widening spread of the United
States war fronts, Mr.. Roeser said,
was sharply increasing the demand
for petroleum products. He esti-
mated the present production at
3,86O,00 barrels of crude daily, with
$4,000 additional barrels daily taken
from storage
The demand for AGO 900 900 bar
rels a year, he said, lis nowhere
near being replaced by new discov-
cries"
Advocating more extensive Wild
cat, or exploratory drilling, Mr..
Roeser said this was necessary IF
the oil industry is not soon to be
confronted with a real shortage of
crude oil production" which would
constitute a threat to the coun-
try"
Meanwhile, the Petroleum War
Council recommended yesterday a
substantial increase" in the prices
OF crude oil and refined products,
including gasoline, to.cover increased
costs and to spur the search for new
oil supplies.
The council also recommended. in
a resolution submitted to Petroleum
Co-ordinator Ickes for transmission
to "the proper Government agen-
cies,' that the Government take
steps to assure equipment for drill
ing new oil wells.