State

The Existing Oil Shortage .Mr. Kirkpatrick explains what has brought about the present temporary shortage in oil. and he also makes some suggestions in connection with meeting the emergency. YOU have perhaps noticed re¬ cent headlines that the mayors of some of the towns on the east coast, including Raleigh, Char¬ lotte, and Greensboro, have called meetings with representatives of the petroleum industry to discuss local fuel oil shortages. Also that Governor Cherry has named Direc¬ tor W. Z. Betts of the State Divi¬ sion of Purchase and Contract to the emergency post of Oil Coordi¬ nator for North Carolina and called on all citizens of the State to do all possible to conserve fuel oil for the weeks ahead. You may also have noted that several oil companies have had to allocate supplies of gasoline to their jobbers and distributors in twelve middle western states this past summer. And more recently some oil companies have had to allocate kerosene and heating oils in some areas on the East Coast. Bear in mind, however, that this local situation has nothing what¬ ever to do with America’s reserve supply of crude oil. It is caused, in large measure, by the fact that de¬ mand for petroleum products has reached record peaks much higher than those of wartime and that the United States alone is now using as much oil as the entire world used in 1938. Shortage of Supplies This situation also is due, in part, to postwar shortages of labor, steel, electric motors, and pipe. These shortages have prevented the oil industry from expanding its pipe¬ lines and other transport facilities as fast as the demand for its prod¬ ucts has risen. You can sec, there¬ fore, that the problem is one of un¬ precedented demand rather than of dwindling supplies. As late as 1922, the U. S. Geo¬ logical Survey reported that the “recoverable oil remaining in the ground" totaled only nine billion barrels. But in spite of these dire predictions, the United States has produced more than thirty-four billion barrels of oil to date and still has reserves in excess of twen¬ ty-four billion barrels. Those re¬ serves now stand at a record peak for all time. By O. Y. KIKKPATKICK Member of ihe American Petroleum Institute Geologists are firmly convinced that an additional fifty billion bar¬ rels of oil are still waiting to be located. In other words, your great grandchildren will still have plenty of oil to heat their homes and drive their automobiles. Now let me tell you something about the present shortage and what oil men are doing to solve this problem in the shortest possi¬ ble time. I think I can prove that there is no lack of basic petroleum today and that the nation has am¬ ple refining capacity to turn that Ktroleum into enough gasoline, ?1 oil and some 1,200 other prod¬ ucts. In the first place, this year's total demand including exports, is esti¬ mated by the United States Bureau of Mines at more than two billion barrels. That is an increase of seven per cent compared with the war¬ time peak in this country. How¬ ever. in North Carolina the 1947 demand is considerably above the national demand. In fact, the de¬ mand for gasoline for the first ten months of this year was eleven per cent above the corresponding ten months of 1946 but the demand for kerosene and heating oils was 60 per cent above the corresponding ten months of 1946. Other Increases Two of the reasons for the in¬ creased demand for kerosene and heating oils in the Carolinas are due to the ever increasing number of oil burners used in curing to¬ bacco and the fact that almost ev¬ ery new home or industrial plant completed during the past two years have installed oil burning equipment. That is to say the de¬ mand will reach a figure of six hundred gallons of petroleum prod¬ ucts per capita in the United States this year, compared with twenty gallons per capita for the rest of the world. That, you will admit, is some demand. What has caused this tremen¬ dous jump in the use of oil prod¬ ucts? Well, for one thing, the num¬ ber of passenger cars, buses and trucks now in use has hit a new high record of about thirty-six mil¬ lion. That is an increase of more than half a million cars in use at the end of last year. And each of those thirty-six million vehicles consumes close to 700 gallons of gasoline annually, to say nothing of their demand for lubricants. The highly publicized labor diffi¬ culties in the coal industry have led many individuals and firms to the installation of oil burning equip¬ ment for heating. For example, during World War I. eighty per cent of our energy was supplied by coal; sixteen per cent by oil and gas, and four per cent by hydro¬ electric power. But, in 1947 the proportions have radically changed. Now. coal supplies only forty per cent of our energy, oil and gas forty-two per cent, and hydro¬ electric power eleven per cent. I am reliably informed that over one hundred thousand domestic oil burners are being manufactured and installed in the United States each month this year. The peak month was reached in September with the sale of 127,591 burners. This and similar unforeseen de¬ mands can cause certain unbal¬ ances in petroleum inventories. Demand of the Government Another cause for increased de¬ mand for petroleum products is due to the fact that the Government will require more than eighty mil¬ lion barrels of oil products for the fiscal year ending June, 1948. Prior to the war the total requirements of Army. Navy and Coast Guard amounted to only eleven and a half million barrels per year. The farmer also accounts for a good part of the increased use of f;asoline. tractor and fuel oils and ubricants. In tractors alone, there has been an increase of more than a million vehicles since 1941. And this year’s consumption of fuels by these tractors will top 1941 by more than a billion gallons. The expanded use of Diesel en- < Confirmed on page 19) THE STATE. January 3. 1948 tl