November 1958

With all the recent talk of recessions and depressions, the newsletter’s research department has rediscovered a potentially valuable recession index…the index of dentists’ collections. This post-World War II economic theorem stated that in good times almost everybody cared for their teeth and promptly paid their dentist. However, in periods of recession, people tended to let their teeth go until they had to have expensive emergency dental work done at which time they were very slow in paying their bills. $ Would you believe that there is gas production in offshore New York? Yep…a commercial gas-producing wildcat in Lake Erie. $ Senator Lyndon Johnson throws out a novel approach for controlling imports. His plan would require any foreign country seeking a share in the U.S. market to meet agreed-upon standards of freedom for its citizens, to split its profits with the workers, and to provide equal wage standards and living standards. LBJ claimed that such a plan would equalize production costs and raise world living standards instead of equalizing poverty.

East Texas crude oil - $3.25/bbl; U.S. active rig count – 2,015

November 1983

Reports of new Iran-Iraq naval clashes near Bandar Khomeini at the head of the Persian Gulf have tankers lined up outside the Gulf awaiting the calming of the waters. $ The phasing out of leaded gasoline begins as some service stations (Remember those?) begin supplying only unleaded gasoline. $ Pemex optimistically claims that their self-imposed crude oil export limit of 1.5 million b/d will soon change from a ceiling to a floor, according to Pemex spokesman Alfredo Gutierrez Kirchner (Kirchner?) $ Howard Keck, the founder of Superior Oil, resigns from Superior and hires an investment banking concern to find a buyer for his 12% block of Superior stock. $ It is reported that the Soviet Union is doubling its purchases of Libyan crude, most of which is being supplied to other Communist countries which are subsequently reexporting it to western European countries. (Capitalism is definitely alive and well in the Soviet Bloc.)

U.S. active rig count – 2,508

November 1998

Nabors Industries makes a substantial cash and stock offer for Pool Energy Services, while Parker Drilling and Superior Energy Services agree to merge. $ Meanwhile, on the E&P side, Phillips Petroleum Chairman and CEO Wayne Allen lets it be known that Phillips is not seeking a suitor and would fight a takeover. $ President Clinton rattles a saber in one hand at belligerent Iraq and waves a pen in the other hand as he appears poised to sign the Kyoto global-warming accord. $ Experts at the Emerging Technologies Energy Conference report that three “macro” technology trends will shape the E&P industry during the 21st century, namely: knowledge management, business process improvement, and e-commerce.

Light sweet crude oil - $13.57/bbl; Natural gas - $2.44/MMBTU; U.S. active rig count – 684

The Rest of the Yarn

Continuing with our theme of examining the lives of international public figures that have significantly impacted the petroleum industry in the 20th and 21st centuries, this month we begin a series of articles on Hugo Chavez, the president (or as he views it, the king) of Venezuela.

By the time Chavez was 19, a military cadet fresh from the impoverished Venezuelan interior, he was already talking to friends about saving the homeland. “I hope,” he wrote in his diary, “that one day I will be the one to bear the responsibility of an entire nation.”

Within a few years, the young Chavez was feverishly organizing revolutionary cells and fusing Marx, Mao, Che Guevara and Simon Bolivar into a rudimentary amalgam of leftist ideas. To many this seemed farcical, but Chavez was waiting for his main chance—the moment when mounting dissatisfaction with a poorly performing and vastly inequitable political and economic system would open the way for a zealous military man promising to tear the whole structure down. Those cells and that rudimentary amalgam became the power base and framework for his “21st-century socialism.”

His ability to make opponents underestimate him has always been one of Chavez’s essential weapons. Just six years before becoming president, he was an unknown lieutenant colonel whose frequent talk of rebellion was dismissed as messianic delusion. When an intelligence report warned of an imminent Chavez-led coup, Venezuela’s defense minister scoffed, and the report’s author was ordered to undergo a psychiatric exam. Weeks later, Chavez tried to overthrow the government and failed, but in the process turned himself into a national celebrity.

Next month, Chavez’s dream is realized.

History Quiz

First discovered in outer space, I fast became essential in building vehicles to traverse outer space. I am somewhat of a nuisance to the oil industry, while much sought after for use in industry, medicine, the military, and research. And in the mid-twentieth century, the Bureau of Mines was investing more than $12 million dollars to produce me.
What am I?

If you would like to participate in this month’s quiz, e-mail your answer to contest@spe.org by noon, November 15. The winner, who will be chosen randomly from all correct answers, will receive a $50 gift certificate to a nice restaurant.

Answer to October’s Quiz

The Oribi field was the source of the first offshore crude oil production for the Republic of South Africa.

Answer to September’s Quiz

The oil industry titan and philanthropist whose son wrote shortly before his father’s 94th birthday: “…In all these years of effort and striving, your own life and example have been to me the most powerful and stimulating influence. What you have done for humanity and business on a vast scale has impressed me profoundly. To have been a silent partner with you in carrying out these great constructive purposes and benefactions has been the supreme delight of my life.”…was John D. Rockefeller.

Congratulations to September’s winner – Marc Fontaine