PETROL PRICES.

Taranaki Daily News, 13 November 1920, Page 10 (Supplement)

PETROL PRICES.

■ EFFECT UPON THE MOTOR ', INDUSTRY. CURTAILING THE MARKET. (By H. Massac Buist in the London Observer.) I/ondon, Sept. 20. A regrettable phase of the post-war mental attitude of the British public to each problem, as it arises in turn, is that we are rather prone to expect that these can be cured by complaining than to face each fact squarely, no matter how unpleasant. Thus, when it comes to the proposition of the present unprecedented cost of motor fuel in this country, some imagine that, if we only complain loudly enough, prices wiil fall. Unfortunately, however, Britain is not a nursery; neither is the British public a collection of petted babies. The price we have to pay for motor fuel is that which those who own it choose to charge us. Therefore the first tiling is to discover who controls motor fuel. In this connection it is far better to give attention to what the British Minister for Petroleum Affairs has to state than to what is given forth by any one of the highly interested parties either in the sale of oils on the one side, or the representing buyers on the other. H.M. Minister has pointed out that over 80 per cent, of the world's total supplies of oil. embracing motor fuels, are eontrolled by America; therefore, in an age of demand in excess of supply, the rest of the world pays whatever price those dictators care to charge; particularly in that we do not produce from British territory more than 2 per cent, of the world's total production of oil fuel. That is the whole story; to which may be added the attitude of the coal miners, resulting in suddenly accelerating the demand for oil fuels out of all proportion to anticipation, after making the most generous allo.wanoes for rapid development.

A SENSE OF COMPARISON. It is idle to discuss petrol as though it had nothing to do with oil. The two industries are part and parcel of each other. Our present difficulties guarantee that we shall have ample supplies of petrol at an earlier date than otherwise would have occurred. No amount of "grousing" that prices should be cut is going to help us now. On the contrary, the big profits it is possible for the successful adventures to make put a premium on the rapid opening up of fresh sources of supply, of which there are incalculable numbers in the world. In the meantime, all the vendors of petrol in this country have to buy their supplies at the price America cares to charge. In America to-day the retail price of petrol, which is liot subjected to a duty and which has not to be brought across the Atlantic and distributed in costly 2-gallon cans and in | other expensive ways that obtain in this country, is about 2s Id to 2s 2d per English gallon. In this country the 'finest-grade petrol costs 4s IOJd a gallon and the third-grade spirit 4s ljd. a gallon. Before we start complaining let us look across the Channel. In France petrol costs approximately 12s. an English gallon I There is no guarantee that motor fuel will fall in price in this country. On the contrary, 1 confidently look for it to tend towards the fie. mark within six or twelve months.

A GLOOMY PROSPECT, All this is passing bad for the development of motoring. But until we shall have tapped abundant fresh sources of supply, and brought near 50 per cent, of the world's production under British control, we cannot look for an easing of the situation. Nobody is going to take the risks of oil mining if success in that enterprise is not to yield a handsome profit, of which the Government necessarily takes by far the largest proportion by way of direct taxation. Consequently profits have to be calculated on a more generous scale than would ordinarily obtain to stimulate the same amount of enterprise, which is of far too risky a nature for any Government to undertake with taxpayers' money. Then; is one success only among many efforts of this sort. But the very badness of our state and the gloominess of the immediate prospect is the guarantee that brighter days will dawn sooner than otherwise would have obtained. For example, today we are assured that there will be no difficulty about marketing petrol cheaply once we have sufficient supplies of crude oil because by leaps and bounds we are increasing the demand for the residuary products. Already one-quarter of the -ships refuelled in British ports are supplied with oil instead of coal. The Government quite expects that in ten years' time over 80 per cent, of those ships will be fuelled in our ports. Of course, that means relative ruin for the coal industry. The miners are bringing that situation about.

There is no gainsaying that, though alcohol fuel would be a welcome addition, nevertheless it will not replace the demand for petrol in any sense. It may relieve it in part at some distant date. Likewise, it is idle to talk about pushing the production of benzol when we are in difficulties to obtain coa! for any purpose. Benzol derives from that strike-governed fuel, with Scottish shale as a possible alternative, whose yield is in any case needed wholly by the Government.

CASE OF THE WORLD'S MOTOR INDUSTRY. As to the effect on the motor industry of the world, of course the fuel situation tends to curtail the market for vehicles as we know them. Let us look abroad and obtain a sense of proportion. There has been a second motor-car manufacturing company failure within a week in America. Moveover, lirms there are sacking men by the ihonsanrl, us in France and Italy. France's utility motor industry is more or Jess faced with bankruptcy; there is hopeless over-production. One firm, i"hose vehicles are favourably known in (his country, has over 700 lorries produced for which there is no home demand. Again, we have to remember that such developments as provide London with vastly improved omnibuses necessarily means that the long familiar Pi type "Red Generals" are by no means worn out and have therefore to be disposed of in quantity. If you have any use for such a vehicle von can buy one thoroughly overhauled, with a six months' guarantee and a seating capacity of thirty-four, complete with electric lighting set, for £SOO. Probably it may last you ten years. Moreover, if you do not want the bus , bodv vou c»n have the chassis alone mi-

tier the same conditions for £450. We have all the war-style vehicles to diaof at Slough, too. Then there are the light transport ears used in the war, which are passing chiefly through their manufacturers' repair shops, so that they may he reissued under guarantee.

All those and more machines are needed in face of the high cost of railway transport. Their use is held up artificially by the famine price of fuel. .So far, good luck does not appear to have favoured what is called mass-pro-duction problems—on the Continent of Europe at any rate; 'While, to please the Socialists, the Italian taxation scheme is one which practically means that middle-sized cars will pass out of use there after New Year's Day next. Indeed, the Socialists themselves are alarmed because of the dismissals of workers from the factories, and are asking .for a repeal of the yery taves they themselves forced the Government to adopt, the levy on a powerful car being over £OOO a year. All which signs and portents have this in common—they prove motoring to be in the throes of rebirth and the coming of utterly new-style vehicles, vastly lighter and less wasteful of power in the transmission mechanism, to be relatively near at hand.