BRITAIN’S OIL SUPREMACY

Evening Star, Issue 17700, 29 June 1921, Page 3

BRITAIN’S OIL SUPREMACY

story op winning coup

America has for so long boon accepted as world mistress of oil supplies that it is difficult to believe that now, when oil 13 displacing coal as a vital power fuel, her suzerainty is crumbling and that her sceptre is passing into British hands. This acquisition of control of the greater portion of tho world's known and potential oil supplies is tho result of British foresight, enterprise, and boldness, the lavish but judicious investment of capital, and the employment to its fullest extent of tho native genius for finance and commerce. That America herself has no delusions about her fading supremacy is shown by her vigorous attempts to secure equal opportunities with Britain in the development of the rich oil resources of tho latter’s mandated Mesopotamian territory, and, only lately, tho United States’ effort to obtain oil concessions in tho East Indies. Tho United States in 1920 produced no loss than 53,000,000 tons of oil, but this enormous output, it is known, cannot be maintained, as the exhaustion of oil pools, on the authority of an expert, “approaches every day.” Already the United States imports a large quantity of foreign crude oil in order to supply her own requirements and maintain her exports of refined products. It has been estimated that, in addition to her production last year of 445,000,000 barrels of oil, United States required 120,000,000 barrels of foreign crude to meet all its requirements. America is immensely the greatest consumer of ail petroleum products, and that the importance of the future is appreciated there is .shown by a recent statement by the president of the Standard Oil. “With its position,” he said, “in world trade and economic and financial weapons ready to hand, the United States could undoubtedly compel a new allotment of foreign oil territory so as to give it a share of what other nations are now proposing to keep for themselves.” Already moves have been made to induce Congress to place a restriction on the export of domestic crude oil and its products. Tho rise and development of tho petroleum industry is one of the interesting industrial romances. United States made a modest commencement in 1859 with an output of 26.000 tons, the figures rising by leaps and bounds until last year’s production was over 2.000 times that of the opening term. Tho value of America’s 1920 production of crude oil was estimated at £200,000,000, and of tho refined products at over £500,000.000, tho latter greater than the combined value of America’s production for the same period of gold, silver, copper, lead, and zinc. The' value of tho world petroleum products for 1920 was about £650,000,000. For years! America and Russia were neck-apd-ueck m petroleum production, but the United Slates took the lead in 1903, since which time until to-day two-thirds of the world’s production has come from the United States. During half a century petroleum production had its head in America, where all producers, according to Mr E. De Hautbcck, M.R.L.S., writing in tho London ‘Mining Journal, are tributaries of the Standard Oil Company, which was the master of the world petroleum market. Tho Standard Oil Company has had its imitators in other countries. Rothschild took part in the Baku oi'fields, the Royal Dutch controlled me oilfields of Sumatra, Java, and Borneo, while different oil companies—British, French, German, Austrian—began to open up the fields of Rumania and Galicia. Then came the discovery of tho internal combustion engine, and the consequent wonderful development of motoring _ gave on' a new and powerful impulse. British shipping companies like the Cunard, White Star, etc., hastily fitted tho boilers of their large steamers to burn oil fuel, and had to draw their supplies from America. The war, the development of commercial shipbuilding by tho United States, and that country’s decision to embark on the construction of battle cruisers burning oil fuel all conspired to increase enormously tho commercial importance of oil and to force oil to a prominent position in world politics. Several year's before _ the war, however, some perspicacious British business men and wise statesmen foresaw tho formidable consequence of the role of oil fuel on the equilibrium between the nations and on their own country’s future. From longestablished tradition the British Empire rests upon tho coal layers, and from tho moment that a new fuel endeavors to replace coal Great Britain feels the need to possess oilfields, as previously coalfields. Thus, without losing time, by skilful turning ami discreet approach, there was prepared ana realised amidst general inattention tho acquisition by Britishers of the world’s principal oilfields. Many British oil concerns were interested in the oilfields of Baku, Grozny, Rumania, Galicia, ami other countries. They had formed a good school ot experienced oil geologists, and British metallurgy organised the manufacture of pipe lines, oil well drilling supplies, pumping n»- 1 chinery, tank steamers, and tank cars, ’ihe British petroleum industry thus had in its hands the human and mechanical tools for tho rapid development of tho newly-ac- j quired oilfields throughout tho whole world, Above all, England possessed a bold, resolute, and far-seeing group of financiers with considerable capital and infinite business knowledge, ability, and resource. It was essentially necessary not to attract the attention of the Standard Oil Company, so j a timid start was made to develop tho .Shell Transport Company. At its origin tins was a small company interested in the mother o’ pearl trade, but it took an interest in Egyptian and other oilfields. These undertakings were successful, and the shell trade, was definitely replaced by oil. The company’s prospectors tlew througn the Indies, Ceylon, Malay, North China, Siam, Dutch Indies, Caucasus, Ural, Caspian, etc. Similarly the strongest European petroleum trust, tho Royal Dutch, followed the same policy. They bought oilfields in Texas and Oklahoma, and tried to obtain concessions in Central America. As early as 1907 an association was formed between the Shell Transport and tho Royal Dutch, concord being established on such questions as markets, prices, and freights. Then carao the turn of the Burmah Oil Company, exploiting the Burmese oilfields, and tho Anglo-Persian Oil Company, in which the British Government is the chief shareholder, a monopolist of the Poisian oilfields and later extending its activities to Australia, Papua, Newfoundland. Hungary, and elsewhere. Both these companies, with a new petroleum policy, obtained the non credits necessary. This strong British oil combine was glued as a. single body' to tho Mexican Eagle, of the Pearson group, a few months after the signing of the armistice. Thus a British oil combine controls to-day oil resources throughout the whole v.-onct. The Shell-Royal Dutch combination is prominent in Rumania, Russia, California, Oklahoma, Texas, Venezuela, Dutch Indies, and Egypt; tho Mexican Eagle Company m Mexico, the Burmah Oil Company 111 Burmah. and the Anglo-Persian Oil Company in Persia. The Royal Dutch and Shell group also controls smaller oil companies in Ceylon, North China, Philippines, Siam, South China, Australia. New Zealand, South Africa, Curacoa, Canada, Virginia, Venezuela, etc. At the present time Great Britain can double her world coal stations by new oil ones, and assure her ships liquid fuel as hitherto coal. No doubt the total production of oil by the British combine is even now but one-third of the Standard Company’s output; but the United Status's oil pools arc declining, while British capital and brains are every day developing new sources of supply. Ten vears ago England did not possess any oilfield, and was at the mercy of others. To-day she is independent, and to-mrorow the same expert, Mr Do Hautbcck, predicts she will reign in the world petroleum market. The coal layers—-the Empire foundations—showed signs of shaking; they were immediately reinforced by oilfields. The ten years’ work of a few exceptional Englishmen changed geography and turned history, bringing to the British oil supremacy and giving the Empire a renewed lease of life and prosperity.