World Oil Problems Most Perplexing

Chronicle (Levin), 31 March 1949, Page 5

World Oil Problems Most Perplexing

Received Wednesday, 8.50 p.m. LONDON, March 30. The opinion that one of the most perplexing problems which will con front the yorld when Marshall Aid terminates will be the eontinuing dependonce of many European areas upon supplies of oil from dollar sources, was expressed by Mr. P. M. de Veulle, a senior member of the Trade Reiations Department of Shell Oil Proprietary in an address to the Institnte of Petroleum. Mr. de Veulle pointed out that although oil is produced in some 20 differeat countires international trading m oil products is almost entirely concertied with production from American or dollar sources on the one hand and from Anglo-Dutch or sterling sources on the other. The Organisation for European Economic Recovery estimated that. the oil requirements of countries participating in the present European recov-

ery programme would be 30 per eent. greater in 1953 when Marshall aid ended than it was today. Unfortunately )bj the end of the Marshall Flan perio-J it appeared certain that the majority of the participating countries would still be heavily dependent upon oil frou dollar areas. It might be argued that this could be overcome by producing more oi: from s.terling sources and reducing pui' chases of dollar oil, but such a policy would cause ill-will in the Uniteu States and widespread disloeation o. the oil industry. In the 16ng run it would be both expensive and uneconomic, for if dollar oil was sliut oui of the European markets it would un doubtedly seelt other outlets which would alfect sterling , companies interests. Emphasising the importanee of tluproblem Mr. de Veulle pointed out that petroleum products were now the most , important iteni both in volume and value in international trade. Lasi year the total volume of petroleum products transferred between variou.countries was 150,000,000 tons, or more than twice the total volume of food stuffs transferred from one country to another. The annual average capital expendifcure by the world - petroleum industry (exclusive of the Russian sphere) was greater than the total defence expenditure of the United Kingdom this year, and equal to nearly 58 per cent. of thc total dollar funds granted for European recovery.