Ominous Oil

"OIL OIL OIL" was the title of a full-page advertisement in many newspapers last week. It was paid for and written by Henry Latham Doherty, master of Cities Service Corp. Oilman Doherty was loudly crying an old cry of his: the need of Federal control of oil production. Said he: "I have no fight with our Federal officials . . . for I doubt if they would have gotten any place in a fight with a great line of Oil Barons, but the situation has now gotten so bad that many of these Oil Barons are themselves frightened, and, I believe, now is the time to strike." Immediate reason for the Doherty blast was a conference of independent oilmen, called by the Governors of eleven oil States. But at this meeting, in Washington, Government-control was not an issue. Loudest and longest were speeches urging an oil tariff.

Kettleman. Oilman Doherty believes in the unit form of operating an oilpool. Part of his last week's blast was: ". . . Competition in an oilfield is no more competition than is a run on a bank. . . . In fact, the operators are trying to get not only their own oil but everybody else's." Last week a small owner in Kettleman Hills, rich California field, denounced Secretary Wilbur for his plans to put Kettleman on a unit basis. The small man said unit operation would give Standard Oil of California a monopoly. Phrase. To scraggle-whiskered Governor William Henry ("Alfalfa Bill") Murray of Oklahoma the oil industry was indebted last week for a new name, editorial writers for a new phrase--"an example of occupational selfishness." Richfield Receivership. Concrete evidence of the industry's troubles was the passing of Richfield Oil Co. of California into receivership last week. The action came as no great surprise, since for many a month Richfield has frantically fought. to avert the inevitable result of big debts, no cash. Oilmen knew that Sinclair Consolidated Oil Corp., Tide Water Associated Oil Co. and Union Oil Co. of California had each thought of acquiring Richfield. A solution was thought to have been reached when a big change took place in Richfield's management and William Chester McDuffie, 44, president of Pacific Western Oil, became president of Richfield. The roots of Richfield's troubles lie in the speed with which it expanded. Sales in 1927 were $38,000,000. In 1928 they jumped to $52,000,000. In 1929 a record of $83,000,000 was registered. Growing out of a flush pool (newly opened) in California, Richfield spread service stations far and wide, was a leader in the mad race for gallonage. No territory was considered too competitive for invasion, and early in 1929 Richfield entered New York-New England. Although smaller producers were bought, Richfield could not keep up with its sales and had to buy petroleum on contract from other companies. Richfield's buying contracts made other companies think twice about buying Richfield when the time came. Mr. McDuffie, president, last week was made receiver. His bond was set at $3,500,000, a Federal record. He is an experienced oilman who began work in a pipe gang in Coalinga field. In 1910 he went with North American Oil Consolidated, in 1915 with Shell Co. of California. Later he was made production manager of the Royal Dutch-Shell group and given a choice of office in either London or Los Angeles. He chose the latter.

In 1928 Oilman McDuffie left Royal Dutch-Shell. He and Jacques Vinmont (onetime Jacques Weinberger) of Blair & Co. formed Pacific Western Oil. Mr. McDuffie has a new home in San Marino (Pasadena suburb), plays strenuous tennis on his own court, uses no tobacco. His office is in the new black-&-gold Richfield Building which is crowned by a mighty air beacon. This building was erected by Clarence M. Fuller, spectacular marketer and advertiser whom Mr. McDuffie succeeded as Richfield president.

Sharp selling brought Richfield Oil common stock to a new low of $2 1/4 last week. Brokers recalled its happier days when a pool, said to have been the first operated by William Crapo Durant's son R. ("Cliff"), sent it up to 54 1/8 in 1928. Receiver McDuffie stopped reports that he would resign from Pacific Western, said eventually Richfield's creditors will be paid in full.

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