Evening star., 1949-02-04
Fue|0i|Surp|us
Pi|esUp With
mild Winter
| Production Increase
Overshoots Demand: !:
| D. 6. Sales Troubled :
By Hermon r. Schoden

Oil dealers who were ripping bot.
toms out of barrels this time last
year looking for enough fuel oil to
keep Washington homes warm are
now witnessing the surprise about
face Of surplus stocks going begging.
In a years time the petroleum
industry. through an immense effort
on its own, and through unforeseen
such as comparatively
mild weather. has come back from q
period of critical shortage to
plentitude that is even more ex-
to dealers who now eye
blimful tanks.
1t is all rather puzZling to the
layman, who observed the grim bat
tie to keep Washington industries
and homes supplied through an ice
packed Potomac last January and
February and recall a warning that
this winter also might prove tough.
One Washington retailer of Is
years experience surveyed his drop
of from 20 to Is per cent from last
years business and said his fate In
typical of the industry as a whole.
Two Main Factors.
Boiled down. the surplus here may
be laid to two factors: Cd Intensified
production and expansion by the
petroleum industry and (2) ab.
normally warm weather.
D. r. Beane, vice president Of
Griffith Consumers Co.. who has
been watching the retail oil business
here since its infancy, regards this
as probably the least happy Of all
winters for oil dealers. with the
possible exception Of 194l-42 and
1892.
With an unlimited replacement
supply in sight, business has suf-
fered from the generally warm sea.
son. In addition to losses in sales,
dealers are obliged to keep on hand
extra truck crews in case things
pick up. In Mr.. Beane's case, only
half of Is truck crews have been
dCllFely 6HgdSeO.
On larger scale James v. Brown,
secretary-treasurel of the National
Petroleum Council, points to the in
dustry's ail-put production effort
as one Of the prime reasons for the
surplus
$4,000, ,00O,o 900 Expansion.
Stepping into high gear after
throwing of war restrictions. tbs
industry has engineered a $5,00O,-
100000 expansion program during
| the last two years. One result was
a prodigious upswing in oil produce
ton.
! Mr. Browns figures showed
roughly a 100000 barrel, monthly
production increase for 1948 over
that Of 1947, or about per cent.
The industry was in position to
avert last winters pinch. but the
clements played prank, spilline
the toughest weather in the Western
areas, where natural gas and coal
are used more than oil. The East,
on the contrary, has been baln1y in
contrast with last years freezer.
! At last check, the industry's kero-
sene stockpile nationally measured
| 22,000,000 gallons. compared with
100000 at this time last year; and
the kind of oil used in home fur
naces gagged reserve of $4,000, 900
gallons, compared with last years
100000.
Prices Trimmed.
The consequences have not yet
shown up materially at the pro-
duction level, but the possibility
looms that workers may have to be
laid off. The high supply and low
demand also has shown up in price
slashes at the wholesale level, and
a drop of ST per barrel. or 20 per
cent, in Pennsylvania crude oil in
the last six weeks.
One of the few happy people di-
rectly connected with the situation
is j. Thomas Kennedy, director of
weights, measures and markets, who
headed the Fuel Oil Co-ordinating
Committee during last winters
scramble for oil.
Besieged by hundreds of calls by
cold home-owners, Mr.. Kennedy's
committee ladled out more than
100000 gallons of emergency oil
last January and February.
Today Mr.. Kennedy's committee Ia
still standing by, but he doesn't
know why. They haven't had q
distress call all season.