Oil Is Big Problem

Northern Advocate, 15 July 1949, Page 5

Oil Is Big Problem

LONDON, Thu. (11.30 a.m.).—Commonwealth economic leaders, who are meeting in London to consider the sterling-dollar crisis, today discussed the possibility of large-scale United States investments in their respective countries.

The delegates had already accepted a decision by Britain, the United Stales and Canada to carry the ster-ling-dollar deadlock to the International Monetary Fund in Washington in September but had yet to decide whether the Chancellor of the Exchequer (Sir Stafford Cripps) should represent the Commonwealth as a whole or whether individual delegates should attend. When the Ministers adjourned after their two-hour meeting today, Mr Nash (N.Z.), said they had continued to make good progress in general consideration on the long-term measures to close the dollar gap. SELF-SUFFICIENT There had been discussions on plans to make the Commonwealth selfsufficient in oil supplies. When the Ministers met the British Fuel Minister (Mr Hugh Gaitskell), opened general discussion on oil and its bearing with the sterling-dollar deadlock. Imports of petroleum products and refining machinery into the Commonwealth countries fi’om hard-currency areas are believed to have been included in the discussion. The delegates were confronted by the fact that the yearly cost of ster-ling-area petrol is well in excess of £100.000,000. Although the output of British oil companies is much greater than the consumption in the United Kingdom, the oil industry makes at present the largest single claim on dollar expenditure. REFINING CAPACITY Plans to reduce this dollar drain by file development of refining capacity in the Commonwealth and the United Kingdom—already projected by Britain—are being considered by the conference. These plans visualise the establishment of a £125,000,000 industry in Britain, covering seven refineries or major extensions. Work has already begun on three of them. Britain is also considering increasing the refinery capacity rf Britishowned companies outside the United Kingdom. British companies, in conjunction with American companies, have plans for building pipelines to carry crude oil from the Persian Gulf to the Mediterranean coast. Mr Gaitskell is understood to have given the conference today a full appreciation of the complex problems of world oil finance and its bearing on sterling-area economy.