October 1957

How big are oil tankers getting these days? Bethlehem Steel is building a supertanker for Onassis Interests (Remember… Jackie’s second husband?) that will be larger in total tonnage than the entire 132-ship Spanish Armada. Studebaker-Packard reports plans to enter the economy car market by introducing the German-built “Gogomobile”, which will get 38 to 48 miles per gallon out of a 17 hp rear-mounted, two-stroke engine. (My riding mower has more hp than that!) Russia puts the first unmanned space satellite (Sputnik) into orbit. (How many of you baby boomers can remember where you were when that announcement was made?) The first successful oil producing well on the Alaskan Kenai Peninsula is completed by Richfield (Remember them…the “R” in ARCO?)

East Texas crude oil - $3.25/bbl; U.S. active rig count – 2,488

October 1982

The U.S.S.R. reports a record 12.292 million bbl/day of oil production, while insisting that it cannot be maintained due to maturing fields. Gulf Oil Chemicals temporarily shuts down its Cedar Bayou, Texas petrochemical plant following a bomb threat and ransom demand. (Such threats have taken on a whole new significance in this day and time.) Blaming a world tanker surplus and demand shifts, BP reports plans to sell or scrap one-third of its tanker fleet. ARCO reports plans to drill its first well in the South China Sea. (Best not disturb the oyster beds!) Ever wonder how much total onshore undeveloped acreage a major might possess at any one time? In 1982 Exxon reported holding 11.6 million undeveloped acres onshore in 31 states.

U.S. active rig count – 2,416

October 1997

Privatization measures gain momentum in India, Algeria, and even Kuwait. Greenpeace activists board an oil rig off the Dutch coast to protest North Sea exploration. Union Pacific Resources ups the ante to $84/share in their bid to take over Pennzoil. Despite a valiant effort in an area that is extremely sensitive both politically and ecologically, some oil from the Santa Barbara Channel oil spill does reach the beaches. The ruptured subsea pipeline was sealed by divers with, would you believe, fiberglass tape! On the heels of Total’s controversial deal with Iran, Elf reports that it too is engaged in investment talks with that U.S.-sanctioned country. (I say we boycott French wines and truffles!)

Light sweet crude oil - $21.60/bbl; Natural gas - $3.09/MMBTU; U.S. active rig count – 1,001

The Rest of the Yarn

This month we begin a series of articles describing the indispensability of petroleum in successfully waging World War II.

Although not officially entering WW II until December 1941, the U.S. had been exerting a powerful influence on the outcome of the war from the time that it instituted its oil embargo on Japan in July 1941. According to many historians, that fateful step made war with Japan inevitable. The U.S. oil embargo threatened Japan’s normal domestic consumption of petroleum products, let alone its critical naval operations. Japan, however, refused to be deterred from the empire’s strategy of aggression and quickly redirected its priorities to the conquest of the oil-rich Malay Peninsula. Without a doubt the war started and ended in major efforts to keep oil, the blood of war, flowing through the veins of the war machines.

In the Pacific theatre, the margin of victory would swing towards the forces that were able to maintain the lifeline of fuel oil for the naval vessels and aviation gasoline for the aircraft. Throughout the “war to end all wars”, oil was a fundamental factor in determining the strategy and tactics in the campaigns in the Mediterranean and in Europe, as well as in the Pacific. Clearly the oil strategies were the most challenging in the Pacific, where the distances to traverse were the greatest and the vulnerability of the supply lines was the most obvious.

One of the keys to success in the Pacific involved mobile logistics, the ability of the fighting forces to remain in theatre for extended periods of time. The U.S. maintained a clear advantage in this area as a result of its large number of fuel tankers and its plentiful sources of oil, one of the most critical of which was the Lake Creek field just North of Houston, which was an important source of the oil used to make aviation gasoline. Because of these advantages, the U.S. Naval forces were able to remain at sea longer than were the Japanese forces that had to continue to return to land bases to refuel and restock.

The beginning of the end for Japan in the Pacific came in October 1944, when, because of their oil scarcities, the Japanese navy was forced to converge four separate and distinct forces coming from distant oil-supply sources upon the Philippine island of Leyte in a last-ditch naval effort that has been called the greatest naval engagement ever fought. The timing of the convergence of Japan’s four fleets was not well choreographed, and they suffered a stunning defeat at the hands of the better-equipped and better-supplied U.S. Naval forces.

Next month, more on the impact of petroleum supplies on Japan’s European allies, the Italians and Germans in the Mediterranean and European theatres.

Readers are encouraged to submit brief, ostensibly true stories about notable personalities from our industry’s storied past. Submissions should be e-mailed to contest@spe.org.

History Quiz

In the late 1950’s an operator consortium was formed to, among other things, cooperate in the development of some novel offshore drilling techniques. This consortium was named the C.U.S.S. Group. What four operators made up the C.U.S.S. Group?

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

Answer to September’s Quiz

The Indian word with a French spelling, Piceance, actually means “tall grass”, as describing this particularly rugged and isolated area in Colorado near the Utah state line.