Papers - - Stabilazation - Petroleum Stabilization in 1933

The major development in stabilization of the oil industry during 1933 was the transition in the United States from state control to federal control in many of the functions that government is presumed to exercise. A brief review of the influences leading to that transition is given here to suggest its significance and to assist in forecasting its further development. Bitumens were known to the ancients and have been applied to minor uses since earliest historic times, but it was not until after the discovery of oil in considerable quantities near Titusville, Pennsylvania, in 1859 that it was made the basis of extensive commercial undertakings. In 1859 little was known about the origin of oil and gas, the nature of these deposits, and the physical laws that controlled their accumulation. Scientists soon began to study them, but 50 years or more of active oil-field development had elapsed before sufficient geological information had been accumulated to point the way toward efficient recovery of these products. In fact, only within the past five years has the function of reservoir energy become widely understood, yet it is a primary factor in oil recovery. discovery near Titusville, this infant industry has developed into an industrial giant. In complete ignorance of their destructive effect, wasteful development methods were initiated in Oil Creek and these became industrial habits. These habits in turn became oil and gas law. Under that law vast sums of money have been expended, rights have become vested and development methods fastened on a great industry that not only bring upon it periodic demoralization but cause ruthless destruction of the nation's reserves of these important natural resources. This is occurring in the midst of a petroleum era when oil is essential to the nation's security, its industrial supremacy, and the personal convenience of every citizen. Its conservation, therefore, has become a question of grave national concern. Conflict between PHysical Facts and Oil Law This destruction of an important natural resource and periodic demoralization of a vast industry can be halted only by readjusting oil