End of Europe's Crisis

Despite Office of Defense Mobilization advice that Europe cannot yet depend on Middle Eastern oil, the Texas Railroad Commission last week sharply cut daily Texas output by 224,710 bbl. to 3,564.665 bbl. The commission, which had reluctantly boosted production a month ago, acted on reports of a surplus in U.S. crude that could cut domestic prices all down the line. In addition to an estimate from the Bureau of Mines that daily U.S. demand for April will decrease 425,000 bbl., the commission heard testimony from major refiners that oil lifters (shippers in the emergency oil lift) cannot find European takers for some crude, are even canceling orders.

J. A. Neath, chairman of Humble Oil & Refining Co., which had strongly urged a big boost in production all through the Suez crisis, now agreed with the commission that the latest increase may have been a mistake. To fill one April order of 2,900,000 bbl. of crude for Europe, Humble has found 2,500,000 bbl. readily available. In Washington, where the Administration had criticized the oil industry for supposedly failing to supply Europe with enough oil, Assistant Interior Secretary Felix Wormser told the House Interstate and Foreign Commerce Committee that U.S. oil lifters had supplied more than 90% of Europe's needs during the shortage, now deserve a handsome "well done."

Five big U.S. producers, meeting in London with British, Dutch and French oilmen, forecast that European requirements for Middle East oil will more than double in the next decade to 300 million tons a year. Even if the Suez Canal is restored to dependable use, they reported, the canal can handle only a small percentage of the increased flow, must be heavily supplemented with new pipelines to Mediterranean tanker ports. Under study is a $500 million pipeline with 60 million tons annual capacity, to run from Iraq to Iskenderuri, Turkey. Another idea is for an internationalized Middle East pipeline system administered by all transit countries, with oil companies simply paying for services rendered. By letting the Arab nations run the lines, the oil companies might lessen the dangers of sabotage.

This file is automatically generated by a robot program, so reader's discretion is required.