Petroleum and Gas - The Trend of the Petroleum Situation

The outstanding features of 1926 in the petroleum industry included the following: 1. Stocks of all oils (crude and refined) were reduced, making the first annual decline since 1918. 2. Domestic crude oil production increased steadily during the last 11 months of the year, accelerating during the fourth quarter, and ending the year at the highest level ever attained. 3. Three new major oil fields were developed—Panhandle, Spindle-top and Seminole. 4. Important advances were registered in production technique, tending to retard the declines of old wells and to maintain the flush periods of new wells. 5. The problem of gaining greater economic control of production through unit operations and gas conservation received growing recognition by the industry and the Federal Oil Conservation Board. 6. The rate of drilling was sharply increased during the second quarter of the year and suffered only a very slight retardation during the closing months. 7. The runs of crude oil to stills were maintained above normal throughout the year and underwent acceleration during the fourth quarter. 8. The gasoline situation was marked by a continuous and substantial increase in the rate of production of cracked gasoline, and by an improvement in the statistical position of the commodity. 9. Prices of both crude petroleum and its principal derivatives were characterized by more profitable levels and greater stability than for a number of years past; and, while showing declines during the fourth quarter, prices did not recede sufficiently to slow down materially either drilling or refinery operations. Change in Stocks The keynote of 1926 was a reduction in stocks of all oils to the extent of approximately 24,000,000 bbl., or 4.4 per cent., of which roundly