Up Again

Said a Standard Oil man: "A horrible surprise." The rest of the industry felt the same way. Last week, only six weeks after a 20-c--a-barrel increase in the price of crude oil had upped retail gasoline and oil prices, Sun Oil Co. raised its buying price for crude again. This time the price went up 50-c- a barrel, the largest single rise oilmen could remember in years. It brought the price of crude bought by Sun Oil to $2.65, highest since 1920.

Other companies were "carefully weighing" a price increase. Companies dependent on outside sources of crude had little choice. If they did not meet Sun's buying price, they would probably not be able to buy crude. In explanation of the increase, Sun's Vice President John Glenn (Jack) Pew* said that his company had "found it increasingly difficult to obtain crude oil. . [because] of ever-increasing premiums which are being paid ... by many of our competitors." But many oilmen disagreed when Pew added that "an increased price will prove an incentive for stimulating increased production" Crude was short because of high demand, lack of transportation and a shortage of drilling equipment for new wells. No price rise could cure these conditions.

Sun Oil does not intend to pass the boost in crude prices on to consumers (normally a 50-c- increase would raise gasoline prices 2-c-) unless "other companies raise their prices." Jersey Standard's Eugene Holman said he did not favor price increases "at the present time." But the chances looked pretty good that many other companies would raise both crude and product prices even though industry profits are running 67% better than last year. Any such increase would step up pressure for price control and rationing of oil products.

Even before Sun acted, Acting Interior Secretary Oscar L. Chapman had called for price control and rationing of oil, along with coal. Socony-Vacuum was already rationing its East Coast dealers, and last week Standard Oil of Kentucky did the same for its 3,000 Alabama dealers. But the industry was still on the price spot.

* Not to be confused with his uncle, John Glenn Pew, President of Sun Shipbuilding Co., or with his cousin, John Glenn Pew Jr., also with the shipbuilding company.

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