The Evening Star THURSDAY, MAY 4, 1922.

Evening Star, Issue 17959, 4 May 1922, Page 6

The Evening Star THURSDAY, MAY 4, 1922.

Earke this year the Fuel Research Board of the Department of Petrol Scientific and Industrial

Monopoly. Research issued a memoran-

dum in England on the subject of fuel for motor transport. The conclusion reached was somewhat unexpected. lit was that there is little prosTR’ct of any rival to petrol as ft means of propelling "road vehicles. The memorandum states : “ The prospect is remote of adding materially to the supply of liquid fuel for internal combustion engines in this country by the manufacture of alcohol from home-grown materials,’* and it is equally discouraging with regard to the synthetic production of cheap fuel on a commercial scale. There liavo been hopes hold out of an efficient mid cheap fuel being derived from wood or from,potatoes, this "wood alcohol being suitable for use in the ordinary motor ear engine without any changes being necessary except in respect of the carburettor. .But apparently those expectations cannot bo realised. As investigation has shown that petrol is likely to reign without a rival, it is evident that inquiry is desirable into tho world’s supplies of this fuel and the matter of their control. This lias recently been done by Mr Emil Davies, a wellknown commercial and financial London journalist. As he rather neatly puts it, if Oil is King let us at least sco to it that lie be made a constitutional monarch. For them aro, to put it very mildly, strong grounds for suspicion that tho present system of control is a species of despotism, and that tho subjects users of petrol the world over—have to supply the despot with whatever revenues he chooses to fix. Mr Davies .states that 11 tho production, refining, and distribution of practically all the petrol used throughout tho world is under tho control of loss than fifty men, combined in three groups.” These are the Standard Oil (represented in Britain by tho AngloAmerican Oil Company), the Royal DutchShell Combine, and tho Bnrmah-An.glo-Porsian Oil Group. The sub-committee unpointed under tho Profiteering Act in Britain reported in 1920-21 convicting tiro trusts of unconscionable profiteering, saying that tho profits, if revealed in their entirety, would stagger humanity; but tho structure of tho combines is such that their full profits aro never shown, nnd aro never likely to be. As with tho tobacco monopoly, there is tho parent company, holding shares in a number of .subsidiary companies registered! under tho laws of "the various countries in which they operate. Brief analysis of tho affairs of tno Royal Dutch-Shell Combine shows how things aro managed. Its history is ono of uninterrupted extension and purchase of any other interests which bccomo iniprudent. Not .satisfied with its sources of supply in tho Malaysia, it has invaded the Standard Oil Group’s territory and has acquired big interests in California. About three years ago it followed this up by acquiring the Mexican Eagle Company from ft group of English capitalists, and (ho importance of this acquisition of a new subsidiary company may ho gauged from tho fact that tho last report of tho Mexican Eaglo Company discloses a net profit of £7,0C0.0C0 "for tho year. It is therefore not surprising to learn that, despite assiduous periodical watering oi capital by the creation and issue of bonus shares fully paid up, tho annual dividend of the Royal Dutch-Shell Combine lias been maintained for many years past at 55 per cent., free of income tax. There is, however, some .prospect* or at least some possibility, of competition disturbing this lucrative monopoly. The Angln-Poi'fiian Oil Company, two-thirds of whoso ordinary capital of £7,5C0,CC0 is held by tho British Government, tho remainder being held by tho Burmah Oil Company “and a few favored individuals,” is already a largo producer. In order to market its products tho AngloPcrsian Company had to malm contracts with a concern belonging to the Shell Group; but within a couple of months these price maintenance agreements expire. What will happen then? Will tho British Government consent to remain a party to a form of exploitation which a suh-comraitteo appointed by it, under its own Profiteering Act, has strongly denounced? Naturally tho British Government would need to feel itself in a strong position before beginning price-cutting, The obvious reply by the Standard and Shell Groups to any such step would bo to produce a shortage in Britain by diverting their e-hipments to other countries. Britain consumes 250,000,000 gallons of petrol annually, nnd until tho Anglo-Pcr-sian Company can supply that amount it would not lie safe to throw down tho gauntlet. Developments within tho next few months should bo watched with keen interest by the many users of this indispensable fuel.