OIL SUPREMACY.

Star (Christchurch), Issue 16456, 18 June 1921, Page 4

OIL SUPREMACY.

A BRITfSK COUP. FARSEEiNG FiNANCIERS. America has tor eo long been accepted as world mistress of oil supplies that it is difficult to believe that, now when oil is displacing coal as the vital power fuel, her suzerainty is crumbling and that her sceptre is passing into British hands. This acquisition cf control of the greater portion of the world’s known and potential oil suj>plies is the result of British foresight, enterprise and boldness, the lavish but, judicious investment of capital, and the employment to its fullest extent of the 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 the latter’s mandated Mesopotamian territory, and, only lately, the United States effort to obtain oil concessions in the East Indies.

UNITED STATES* SUPREMACY. The United States in 1920 produced no less than tons of oil, but this »'-normmis output, it i» known, cannot bo maintained, as the exhaustion of her oil pools, on the authority of an expert, “ approaches cvex~y day.” Already the United States imports a large quantity cf foreign crude oil, in order to supply her exports of refined products. It lias 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 immense!v the greatest consumer of all petrolexim products, and that the importance of the future is appreciated there is shown by a recent statement bv the president of the Standard Oil. “With its position,” ] ie 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 gire •<* *hare of what other nations are now proposing to keep for themselves.” jdready moves have been made to induce Congress to place a restriction on the export of domestic crude oil and its products. The rise and development of the 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 2000 times that of the .opening term. The value of America’s 1920 production of crude oil was estimated at about £200.000.000, and of the refined products at over £500,000.000 the latter greater than the combined value of America’s production for the same period of gold, silver, cooper, lead and zinc. The value of the world petroleum products for 1920 was about £650.000.000. For years America and Russia were neck and neck in petroleum production, but the United States took the lead in 1903. since which time until to-day two-thirds of the world’s production has come from the United States. THE STANDARD OIL COMPANY. During half a. century petroleum production had its head in America, wiiore all producers, according to Mr E. de Hautbeck, M.R.H.S., writing in the London “ Mining Journal,” are tributaries of the Standard Oil Company, which was the master of the world petroleum market. The Standard Oil Company has had its imitators in other countries. Rothschild took part in the Baku oil fields, the Royal Dutch controlled the oil fields of Sumatra, Java and Borneo, while different oil companies—British, French, German. Austrian—began to open up the fields of Ro u man ia and Ga 1 icia.

Then came the discovery of the internal combustion engine, and the consequent wonderful development of motoring gave oil a new and powerful impulse. British shipping companies like the Cunard, "White Star, etc., hastily fitted the boilers of their largo steamers to burn oil fuel, and had to draw their supplies from America- The war, the development of commercial ship building by the United States, nnd that country’s decision to embark on the construction of battle cruisers burning oil fuel all conspired to increase enormously the commercial importance of oil. and to force oil into a prominent position in world politics. PERSPICACIOUS BRITISH ' BUSINESS MEN. Several years before the war, however, some perspicacious British business men and wise statesmen foresaw the formidable consequence of the role of oil fuel on the equilibrium between tho nations and on their own country's future. From long established tradition the British Empire rests upon the coal layers, and from the moment, that a new fuel endeavours to replace coaj Great Britain feels the need to possess oil fields, as previously coal fields. Thus, without losing time, by skilful turning and discreet approach, there was prepared and realised amidst general inattention the acquisition By Britishers of the world’s principal oil fields. Many British oil concerns were interested in the oil fields of Baku, Grozny, Ron mania, Galicia and other countries. They had formed a good school of experienced oil geologists, and British metallurgy organised the manufacture of pipe lines, oil well drilling supplies, pumping 'machinery, tank steamers and tank cars. The British petroleum industry thus had in its hands the human and mechanical tools for the rapid development of tho newly-acquired oil fields throughout the whole world.

Above all, England possessed a bold, resolute and farseeing 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 a timid start w,as made to develop the Shell Transport Company. At its origin this was a small comoany interested in the mother o' pearl trade, hut it took an interest in Egyptian and other oil fields. Theso undertakings were successful, and the shell trade was definitely replaced by oil. The company’s prospectors flew through the Indies, Ceylon, Malay, North China, Siam, Dutch Indies, Caucasus, Ural, Caspian, et»\ COMPANIES COMBINE. Similarly the strongest European petroleum trust, the Royal Dutch followed the same poliev. They bought orl fields in Texas and Oklahamn, and tried to obtain concessions in Central America. As earlv as 100 7 an association was formed between tho Shell

Transport and tbi; Floral Dutch, concord being established on such questions as markets, prices and freights. Then came the turn of the Burraah Oil Company, exploiting the Burmese oil fields, and the Anglo-Peraian Oil Company, in which the British Government is the chief shareholder, a monopolist of the Persian oil fields, and later extending its activities to Australia, Papua, Newfoundland, Hungary and elsewhere. Both these companies, with ,a new petroleum policy, obtained the new credits necessary. This strong British oil combine was glued as a single body to the 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 ilu whole world. The Shell-Royal Dutch •'•ombinatioTi is prominent in Rounianla, Russia, California, Oklahama, Texas, Venezuela, Dutch Indies and Egypt, the Mexican Eagle Company in Mexico, the Burmah Oil Company in Burmaji, and the Anglo-Persian Oil jCompanv in Persia. The Koval Dutch and Shell group also controls small oil companies in Ceylon, North China, Philippines, Riarrh. South China, Australia. New Zealand, South Africa. Curacoa, Canada, \ irginia, Venezuela, etc. BRITAIN’S INDEPEXDENT POSITION. At the present time Great Britain can double her world coal stations L.y new oil oues, 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 States oil pools arc declining. while British capital and brains are every day developing new' sources cf supply. Ten years ago England did Pot po>sess any ci! field, and was at the mercy of others. To-day she is independent, and to-morrow the same expert, Mr do Haucheck, predicts she will reign in the world petroleum market. The coal layers—the Empire foundations—showed signs of shaking: they wore immediately reinforced by oiT fields- The ten '•ears’ wok of a few exceptional Englishmen changed geography and turned history. bringing to the British oil supremacy. and giving tho Empire a renewed lease of life and prosperity.