Since the United States is both the largest producer and also the largest consumer and exporter of crude oil and its products, her position is the governing factor in the world situation. Crude oil production in America has been kept well in hand, and this has allowed the price of mid-Continent crude to be maintained at $1.22 per barrel for oil of 36 degrees gravity since February, 1937. The leading purchasers have recently cut the price of East Texas crude by 10 cents, to a flat rate of $1.25 per barrel, thus removing the disparity which had previously existed in the prices of mid-Continent and East Texas crude. In view of the sound statistical position of crude oil stocks, it ie not thought that the price structure in the mid-Continent is in any way endangered by the cuts in East Texas. According to the estimate requirements of the U.S.A. Bureau of Mines, there is at present underproduction of crude oil in America. In ihe week ended September 17, it is estimated by the American Petroleum Institute that the daily average crude oil production was 3,239,050 barrels, or 205,350 barrels below the Bureau's estimate. From the standpoint of production, the industry is still in a fairly good position, and withdrawals from stocks above ground are continuing. Moreover, total stocks today (approximately 284,919,000 barrels) [represent about 82.7 days' supply. whereas crude oil in storage a year earlier was equal to some 89 da: requirements. Oil economists estimate that present crude oil stocks above ground represent a reasonable working level, and it is doubtful if many companies have surplus inventories. An absolute working minimum would be about 250,000,000 barrels. More-[over, the stock position is likely to still further improved by the resumption of the five-day week in Texas.
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