Business: Oil Week

Recalcitrant Julian. Among last week’s many oil events, prominent was the renascent publicity of Charles Courtney Julian, remembered well in California, hitherto obscure in Oklahoma.

In 1923 Oilman Julian, enriched by success in California’s Signal Hill Oilfield, organized Julian Petroleum Corp., did much expanding, sold much stock. His ways of selling stock angered bankers. His ways of selling his products angered other companies. In 1924 he was glad to sell out for about $500,000. Three years later the Great Julian Scandal came, made police reserves necessary. Oilman Julian had no connection with the scandal, but it fixed his name in western minds. About a year ago he arrived in Okla homa City, said he would “come back.” He proceeded to sell stock in Julian Oil & Royalty Co., started three wells in Oklahoma City Field. Two came in as gushers, the third is near pay-sand. He drives a shiny motor, has a high-speed private airplane. His apartment is modestly furnished, his offices are filled with overstuffed mahogany furniture and a corps of stenographers. Who his asso ciates are is not known. He smiles and says they are his stockholders. Sometimes he appears in Tulsa on unnamed business. Often he arrives at his wells dressed in regular oil togs. But never have oilmen regarded Mr. Julian as one of them. They consider him a promoter rather than an operator. And last week they liked him less than ever. Dear to oilmen is curtailment. They dis agree on how to effect it and when, but as a principle it is their credo. No curtailer, it seems, is Oilman Julian. He has defied the rule, let his oil wells gush richly. Last week the Attorney General threatened and abandoned a plan to put his company into receivership to force compliance with the state proration order. Said Mr. Julian: “It’s the bunk.” On the surface last week it seemed his victory. For the list of 73 officials of 59 companies cited for violating the curtailment agreement by the Oklahoma Corpo ration Commission did not include the name of Charles Courtney Julian. But these cases, said the Commission, were mostly not willful ones. Mr. Julian, said the Attorney General’s office, will be cited later, alone.

Better Statistics. Despite Oilman Julian’s recalcitrance there were evidences last week that the oil industry is getting into a better statistical position. The daily average of production dropped to 2,463,000 bbl., below any weekly figure during 1929. This betterment is the result of rigid curtailment. The most spectacular examples are the South Oklahoma City field where, although a 25% production of potential capacity is allowed, operators have been running at 8%, will slow down to 5%, and the Hobbs Pool, New Mexico, running 32,000 bbl. per day instead of a potential 287,000. In Pennsylvania last week curtailment was decided upon by many large independents. Their immediate reward was a 25-35 ¢ rise in crude prices. The Oklahoma City field remains the chief problem, however, and only if curtailment is maintained will gasoline prices be held at present levels. On one day last week eight oil and gas wells with initial production of 80,000 bbl. were opened in this prodigious field.

In Montana. Another indication of co-operation was shown last week when the independent producers of Montana met and formed an organization. Montana is no great oil State. Its production of 3,183,000 bbl. last year was less than half of its 1926 figure, and scarcely more than the production of New York. Montana oil gushes slower and slower, and refining capacity is far ahead of production. By far the greatest amount of Montana oil comes from the Kevin-Sunburst field in Toole County, near Canada. Montana oilmen show a special fondness for selling oil royalties. Probably the most colorful man in this field is one Tip O’Neill, spectacular in early California oil developments.

Profits? How much curtailment of production and unsettled price structure (July index of petroleum product prices: 61 against 73.3 last year) is hurting earnings was shown by these developments last week:

Sinclair Consolidated Oil Corp. on the eve of an expansion (TIME, Aug. 25), reported earnings for the first half of $3,251,000 against $6,196,000 last year. This is 49¢ a share against a dividend requirement of $2 for the year.

Shell Union Oil Corp. passed its dividend for the first time since organization in 1922. Especially hard hit by this are The Royal Dutch Company for the working of petroleum wells in the Netherlands Indies, 43%-owner of Shell Union, and Shell Trading & Transport, 29% owner. President John C. van Ech’s explanation was that there is no indication that the unsettlement will soon be removed, that cash must be reserved for expansion. The company was stated to be “on a profitable basis.”

Another dividend omitted was that of Warner-Quintan Co., Texan and Mexican producer and, in the New York area, a large distributor. Last spring Warner-Quinlan’s dividend was bisected but President William W. McFarland said it would be resumed by the end of the year. This time he merely said conditions would be better by 1931.

Standard Oil of New Jersey. For some reason especially persistent has been the rumor that Standard Oil Co. of New Jersey will lend Spain $100,000,000 at no interest in return for the oil monopoly. Last week Spain “gave assurance” that it has been made no such offer, and Standard’s Walter Clark Teagle, in London, said the story was “made out of whole cloth.”

Oil in New Jersey. For ten years a W & K Oil Co., whose backers have never been disclosed, has been drilling for oil in New Jersey. Last week, after having spent $3,000,000 in this wild crude chase, W & K crated its equipment, shipped it to the richer fields of Texas.

Lago. A pyramid was simplified last week when Pan-American Petroleum & Transport, 83%-owned by Standard Oil Co. of Indiana, voted to absorb the 3% of Lago Oil & Transport Corp. which is not already in Pan-American’s coffers.