Recent Oil Developments in Venezuela

DEVELOPMENTS in Venezuela during the past few months have been obscured by the hap-penings in Seminole and, more recently, those in southwest Texas. The question has been asked whether or not the opening of these vast new, prolific areas in the United States may not have depressed prices to a point so low as to give the developments in the Caribbean countries a serious setback. Nothing of the kind, however, has taken place, and on the contrary, there has been demonstrated the fact that Venezuela can profitably produce great quantities of oil under existing market conditions, and at the same time finance the foundation for further large expan-sion in the future. The three big factors which contribute to place Venezuela in a unique position and tend to insure the steady expansion of its oil industry are, in the order of their importance: I. Reasonable oil laws backed by a sound govern-ment, which comprehends the all-important fact that the country's prosperity depends on the prosperity of its industries, in a word, perceiving that the goose which lays the golden egg merits considerate treatment. II. The low cost of placing Venezuela oil on our At-lantic seaboard; not over $0.60 per barrel. III. The uniformly high average production per well and the large area of some of the individual pools. Under these conditions Venezuelan producers may be expected to continue steady and profitable ex-pansion even in the face of further market slumps. Their position is analogous to that of the low-cost copper producers, and unless artificial barriers, such as tariffs, come into play, Venezuela will steadily grow in importance. Within less than five years it should be second only to the United States among the oil-producing countries of the world.