World Oil Fact and Policy: The Case for a Sound American Petroleum Policy

By David Ice

World Oil Fact and Policy, a brilliant book published in 1944, delivers a deep exploration and disciplined examination of domestic and foreign petroleum resources, their import to United States energy and security policy during World War II, and their capacity to act as a civilizing catalyst for postwar prosperity and peace.

The authors methodically make the case that world wars are both fought for and fueled by oil; that “oil shortage” scares are based upon projections of “proved reserves” and not real reserves or resources; and that Alaskan oil prospects could radically reduce future reliance on foreign resources.

The authors also divulge dynamic details of the British-American Petroleum Agreement, a nascent bilateral agreement signed by both governments in 1944, albeit never ratified by the United States Senate.

This remarkable book is a must-have addition to any archive and a must-read adjunct for any authority in academia, industry, or government. Read now and share with others. The rich research is as predictive and profound today as it was practically a century ago.

• Language: English
• Publisher: Gatekeeper Press
• Release date: Jan 31, 2024
• ISBN: 9781662906664

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The views and opinions expressed in this book are solely those of the author and do not reflect the views or opinions of Gatekeeper Press. Gatekeeper Press is not to be held responsible for and expressly disclaims responsibility for the content herein.

World Oil Fact and Policy: The Case for a Sound American Petroleum Policy

Published by Gatekeeper Press

7853 Gunn Hwy., Suite 209

Tampa, FL 33626

www.GatekeeperPress.com

Copyright © 2023 by David Ice

All rights reserved. Neither this book, nor any parts within it may be sold or reproduced in any form or by any electronic or mechanical means, including information storage and retrieval systems, without permission in writing from the author. The only exception is by a reviewer, who may quote short excerpts in a review.

The editorial work for this book is entirely the product of the author. Gatekeeper Press did not participate in and is not responsible for any aspect of these elements.

Copyright for the image: gettyimages.com/Chad Baker

Library of Congress Control Number: 2023936248

ISBN (hardcover): 9781662932007

eISBN: 9781662906664

Dedication

The memory of friend and mentor Dr. Donald Babcock and the little black book he resolved to share with the world.

Note from the Editor

The editor met a gentleman decades ago in Cleveland while contesting speed-trap tickets at a Cuyahoga County courthouse. An instinctive relationship formed and matured into armchair chats on subjects such as the 1970s dollar debasement and oil crises in the United States, 1980s globalization and industrial degeneration in Ohio, and the obligation for elected officials to enact sound money and energy policies in the best interests of the country.

This gentleman consequently disclosed to the editor a booklet diplomatically passed to him earlier in his career, penned primarily for a closed circle of industry and political insiders, and he aspired to ensure this significant study be accessible to the reading public at any time after his passing. This dutybound editor is merely the gentleman’s emissary privileged to retrieve rare material from the past and unveil it for readers both present and future.

The editor, who is not an energy expert, is finally republishing this obscured book and presenting it for earnest examination by historians, industrialists, researchers, strategists, and politicians alike. The editor provides minimal editing expressly intended to clear up confusion between American English and British English usage and to update subject names or spelling for the reader. The illustrations are enhanced only to optimize clearness.

This edition of World Oil Fact and Policy is republished from the public domain, in its entirety, as originally prepared and published by the Petroleum Industry Research Foundation in 1944.

The Book

Petroleum Industry Research Foundation, Inc. (PIRINC) was created under the sponsorship of Empire State Petroleum Association for survey, analysis, and publication work in the oil industry. It is a non-profit, research organization administered by a board of 33 trustees, comprising prominent oil men of New York State and elsewhere throughout the country.

PIRINC’s office staff at its headquarters, Suite 316, 122 East 42d St., New York, NY, is headed by Harry B. Hilts, executive vice-president; and Henry Ozanne, director of research.

Copyright 1944

Petroleum Industry Research Foundation

New York, NY

Dedicated to the

85TH ANNIVERSARY OF THE BIRTH

OF THE AMERICAN PETROLEUM INDUSTRY.

August 27, 1944

Foreword

When in the course of human events, it becomes necessary for a great industry to seek a more perfect and accurate means of conducting its research and investigations into subjects economic and politic, it is only logical to survey first the magnitude of the continuing task and the caliber of the results desired.

This war has greatly accelerated the internationalization of the petroleum industry, as well as elevating petroleum to top rank among war resources. With its vastly broader scope, greater complexities have come, and problems with so many factors and variables as to defy ready analysis have developed. To paraphrase a famous statement – nothing that concerns world oil will ever be simple again.

As the number of variables in a problem increases, the greater the danger of error and misinterpretation if one of the factors is omitted or ignored. The average oilman’s time is so limited as to preclude his making a detailed personal analysis of some of the questions that loom so large today, so he is forced into a position where he must either form superficial opinions of his own, or else rely upon the careful analyses of a group of unbiased, objective-minded specialists who have had the ability and experience to study the issues seriously and thoroughly.

To supply such research and analytical study to those whose own staff resources are inadequate for the purpose, the Petroleum Industry Research Foundation has been established under the sponsorship of Empire State Petroleum Association. It should fill a definite need of the American petroleum industry as is evidenced from the thorough and analytical character of the work done by PIRINC in this comprehensive and painstaking study of foreign petroleum resources and their meaning to the United States.

WILLIAM R. BOYD, JR.,

President, American Petroleum Institute

Chairman, Petroleum Industry War Council

Introduction

Amid a confusion of prophets’ voices, an oil-anxious nation is casting inquiring eyes at its petroleum bank account. The concern is natural, for oil has played a dramatic, dynamic role in the development of America. Here it has always been available in greater quantities and at lower prices than in any other country of the world. It is as typically American as apple pie—and it has been typically American to search and find it and typically American to want to use it.

Now, before the eyes of a nation vastly dependent on oil for its modern life, new and wider horizons of its usefulness are revealed, not merely in improved fuels and lubricants, but in the whole range of recently opened vistas that are plastics, textiles, rubbers, soaps, resins, explosives—an endless list. From oil we have made a silk purse from a sow’s ear; its atomic architects are building up and tearing down the molecules of petroleum to fashion products undreamed of when Drake’s Folly, only 85 years ago, flowed among the Pennsylvania hills, marking the birth of a new and a great industry. These new uses of oil promise greater comfort, greater convenience, and greater progress.

So rightly should the American people express their concern over the future supply of this natural resource which floated the Allies to victory in 1918 and which winged Allied might to victory in 1944.

But oil, which can be man’s servant and civilizer or his master and destroyer, has an even broader meaning for America—it holds the key to future world peace. On August 8, 1944, Great Britain and the United States signed an oil agreement. This pact is the culmination of long negotiations, and it is the present hope of both nations that petroleum may be made the effective instrument of future peace.

A realistic analysis of this agreement, and of the situation with which it deals, is the purpose of this booklet. In our search for an oil policy that will contribute to world security, to what extent can we find encouragement in the agreement? To what extent does the pact define American foreign oil policy?

The presentation in these pages is not—and does not intend to be—an unreferenced point of view. It is an attempt to report and record the settled thinking of the petroleum industry. All facts and interpretations herein are drawn from industry sources, many from previously published material. In assembling and mapping that data, no views enter which are merely the personal opinion of any person or any group outside the industry.

The material for this survey has been collected from the analyses of the Petroleum Industry War Council and its National Oil Policy Committee; the Foreign Operations Committee of the Petroleum Administration for War; reports prepared and/or issued within the industry by companies, associations, or committees; government hearings or documents; public pronouncements by industry authorities; and the factual accounts of the newspaper and magazine press.

The survey is objective in the type of work it has undertaken. To whatever extent the argument embodies a point of view or champions a position, they are industry’s, not PIRINC’s. PIRINC’s task has been to set forth that position and point of view as they exist. And that, we feel, is a proper burden of research.

Contents

Foreword

Introduction

Fact

I.  Oil – Where It Is Found

II. Is There an Oil Shortage?

Policy

III. Oil – War and Peace

IV.  The Petroleum Reserve Corporation

V. The Arabian Pipeline

VI. A Foreign Oil Policy – The Principles

VII.  A Foreign Oil Policy – The Plan

VIII. The British-American Agreement

Summary

Appendix

Fact

I

Oil – Where It Is Found

Sunlight captured in myriad marine creatures of past geologic ages, buried in thick sea-floor oozes, and transformed by earth chemistry over countless cycles of life and death, is the oil treasure man taps today in his struggle for survival and his search for a better way of life.

Over long periods of time, nature’s laboratory has applied pressure, temperature, and catalyst to the marine deposits of the geologic past, combining and rearranging their organic content into the hydrogen and carbon chains we call petroleum. These hydrocarbons, gaseous and liquid, migrate ceaselessly toward areas of lesser pressure until they are trapped beneath impervious, convex recesses, there held to await the bite of the wildcatter’s drill.

Oil is a normal constituent of marine sedimentary deposits, and its greatest accumulations are in vast basin areas of the earth where inland seas, teeming with marine life, have taken in huge volumes of sediment from surrounding land masses, and the whole has