Civilization and Oil
IT was a lucky thing for human civilization, as we know it to-day, that on August 28, 1859, oil was struck near Titusville in northwestern Pennsylvania. That first well yielded only from fifteen to forty barrels of oil a day, which is a literal drop in a bucket compared with the annual output — sixty years later and in the United States alone — of over four hundred million barrels. But it was from that modest enterprise that the oil industry of the world took its beginning. Had it not been for that, the whole stupendous development of human progress during the second half of the nineteenth century might never have come about. This development has been in terms of machinery. And machinery is impossible without lubricants — and of these the sole source that we know so far is oil, the technical name for which is petroleum.
All our means of transportation and communication, our trains, steamers, motor-cars, aeroplanes; all the machinery that has made possible large-scale production and the consequent untold saving of human effort and increase of the world’s wealth; all the labor-saving devices in the home — all the things that have added so much to life’s comfort and pleasure during the past few decades would not have come if it had not been for oil.
I
The uses of oil to-day are vital and universal; but our available supply of this precious substance is limited.
The late Secretary of the Interior, Franklin K. Lane, said in one of his annual reports: —
Petroleum is a priceless resource, for it can never be replaced. Trees can be grown again upon the soil from which they have been taken. But how can petroleum be produced? It has taken ages for nature to distill it in her subterranean laboratory. We do not even know her process. We may find a substitute for it, but have not yet. It is practically the one lubricant of the world to-day. Not a railroad wheel turns without its way being smoothed by it. We can make light and heat by hydroelectric power, but the great turbines move on bearings that are smothered in petroleum. From it we get the quick-exploding gas which is to the motor and the airship what air is to the human body. To industry, agriculture, and the pleasures of life, petroleum is now essential.
Or, as Mr. Joseph E. Pogue, one of the best American authorities on oil, puts it, in his excellent work on The Economics of Petroleum: ‘The oil industry has assumed an obligation for supplying the vital needs of modern civilization; its best efforts will be required to live up to that responsibility.’
The first and the most important responsibility of the oil industry is to see to it that there is enough oil to meet the needs which our civilization has for its various products. Petroleum resources have now become the most important measure of a nation’s strength. There was a time when territory was the principal object of competition among nations. Wars were fought for it. To-day the greatest, the most acute competition among nations centres around oil. To-morrow — that is, in the course of the next decade or two — this struggle for oil will become still more acute. And the position of the United States in this pressing and vital competition is one of peculiar and increasing importance.
Ever since the first discovery of oil on American soil, the United States has occupied the central and dominant position in the oil industry: it is the greatest consumer of oil in the world. Today the United States uses within its borders fully one half of the world’s total output of oil. It is also the world’s greatest producer of oil. During the six decades that oil has been in use, the United States has contributed sixty-one per cent of all the oil produced in the whole world.
But with this vast production, with an output that mounts above the colossal figure of over four hundred million barrels a year, the United States is fast reaching the end of its available oil resources. Estimates made by Mr. David White and other experts of the United States Geological Survey place the world’s total available supply of oil left for future use at about sixty billion barrels. Of this amount, scarcely one seventh is found within the boundaries of the United States.
So rapid has been the increase of the use of oil in the United States, and so colossal the development of oil-production, that in the past few years the situation in this regard has begun to assume truly alarming proportions. During the decade from 1910 to 1920, a phenomenon of tremendous importance in connection with oil took place in the United States. The country’s demand for oil and its products increased so fast that, in spite of a tremendous increase of production of oil, we have been compelled to witness a transition from oversupply to overdemand. At the beginning of the decade, the oil wells of the United States were adding to the country’s reserve stocks of oil at the rate of fifteen million barrels a year; at the end of the decade, the demand for oil was drawing upon the reserve stocks at the rate of nearly twenty million barrels a year.
When Dr. George Otis Smith, Director of the United States Geological Survey, stated these facts in an address before a recent general meeting of the American Iron and Steel Institute, Mr. Charles M. Schwab, who was in the chair, said to him, —
‘You have told me things I ought to know, and in words that I can understand.’
The need of understanding these fundamental facts about oil has now become vital for every citizen of the United States. For decades past the country supplied itself with what oil it needed, and contributed largely to the satisfaction of the whole world’s need of oil. To-day it does not produce enough to supply its own needs.
Mr. E. Mackay Edgar, an English writer, recently described the situation as follows; —
Just when Americans have become accustomed to use twenty times as much oil per head as is used in Great Britain; just when invention has indefinitely expanded the need for oil in industry; just when it has grown to be as common and as true a saying that ‘Oil is king,’ as it was twenty years ago that steel was king; just when the point was reached where oil controls money , instead of money controlling oil, the United States finds her chief source of domestic supply beginning to dry up, and a time approaching when, instead of ruling the oil market of the world, she will have to compete with other countries for her share in the crude product. . . . America is running through her stores of domestic oil, and is obliged to look abroad for future reserves.
If the United States is to maintain its present position as the greatest industrial nation in the world, and to continue the progress that is necessary to keep pace with the increase of population and the multiplication of its needs, it becomes imperative for the United States to assure for itself as large a share as possible in the oil resources of the world. These resources are distributed almost evenly between the Western and the Eastern hemispheres, with their principal centres in the United States, Mexico, Russia, and the Near East. In the Western Hemisphere, so far as is known, almost eighty-five per cent of the total oilsupply is found north of the Equator, that is, principally in the United States and Mexico.
Left with only its own oil resources, the United States would begin to experience a serious shortage of oil within the present decade. With virtual control of the other important oil-fields in the Western Hemisphere, such a contingency may not arise for, perhaps, fifty years. Shale oil may be developed in the meantime, as a substitute for the liquid product; but this would require a tremendous initial expense, and a much greater extraction cost in terms of human labor. While the United States has probably the greatest deposits of oil shale in the world, an adequate development of the process of extracting oil from shale would require the building-up of a mining industry in the country that would be at least as great as the present coal industry.
II
There is no doubt, therefore, that, the immediate problem in connection with oil is an increased efficiency in the extraction from the crude oil of its more valuable and necessary products. In other words, it becomes imperative to evaluate carefully the various economic uses of oil, in order that the more essential demands may be given due priority. Oil is used to produce light, to generate power, and to save power by reducing friction in the running of machinery. Which of these three uses of oil should be placed first?
In his address quoted above, Dr. Smith, who is one of the world’s greatest authorities on geology in terms of national resources, said: —
In our attention to the generation of power to meet the needs of industry and transportation, we give too little thought to the unique function of oil — that of saving power. Machinery without lubrication is unthinkable; adequate lubrication saves energy and makes it available for use, as well as adds to the life of the machine.
Machinery requires power to run it. This power can be obtained by harnessing the energy contained in falling water and transforming it into electric current. Or it can be obtained by the utilization of various kinds of fuel, such as wood, coal, and the like. By far the most economical of all the various forms of fuel is oil. Being a liquid, it costs much less to mine and to transport than any of the other forms, if we compute cost in terms of human effort. Moreover, it is the most concentrated source of power. In the form of its two largest products, gasoline and kerosene, oil can be transformed directly into power-energy by means of the so-called internal-combustion engines. All these considerations make oil a highly desirable source of power.
But machinery requires, besides power to run it, something that will overcome the waste of power inherent in the inevitable friction that accompanies the operation of any piece of machinery. In every piece of mechanism there are parts that rub against each other. It is a familiar fact that when metal rubs against metal both surfaces become injured, and the speed of operation is impeded. Both of these undesirable features can be avoided by means of lubrication.
Lubricants are nothing but substances that are forced between the rubbing surfaces of parts of machinery, to prevent these surfaces from scraping against each other. These substances must be ‘oily,’ which means that they must have a capacity for forming a film between the rubbing surfaces of metal and for preserving this film unbroken, even when the surfaces are pressed tightly together and the machine operates at a high speed. In other words, in lubricated machinery the metal parts rub against the oily films between them, and not against each other. When a piece of machinery is not lubricated at all, as much as a third of the power put into its running may be wasted, and its parts quickly destroyed by scraping. In a well-lubricated machine, waste through friction can be reduced to an almost negligible quant ity, while the parts would suffer scarcely any injury on account of rubbing.
Before the discovery and the development of oil as a source of lubricants, various kinds of animal and vegetable fats, as well as such solid substances as graphite, were used for purposes of lubrication. They are still used to-day, though the rôle that they play in industry is almost negligible, in comparison with the mineral-oil lubricants, obtained from petroleum. Graphite and other ‘solid’ lubricants are used now in but very few instances. Animal and vegetable fats, usually mixed with soap and water to form ‘semisolid’ lubricants, or greases, are used only for slowmoving machinery or for special parts of machines. But all high-speed machinery requires liquid lubricants, obtainable only from petroleum.
It is in this manner that the whole development of our machine civilization during the past half-century has been made possible, by the utilization of oil for the purpose of obtaining liquid lubricants. The whole future development of civilization depends upon our ability to maintain an adequate supply of these lubricants.
The sources of power are numerous and varied. But oil is the sole source of almost all lubricants. Animal and vegetable fats not only are unfitted for use in high-speed machinery, but also have this peculiar disadvantage: they have a tendency to combine with the oxygen of the air, which acidizes them and often causes them to corrode the metal with which they come in contact. Moreover, they have a tendency to gum, as well as to get extremely hot, when they become dangerous by causing spontaneous combustion of cotton waste and similar substances, which are always found in the neighborhood of machinery. The petroleum lubricants are free from these serious defects.
Nor is it conceivable that vegetable fats can be obtained in anything like the vast quantities required by presentday industry. Merely from the point of view of the acreage that would have to be devoted to oil-bearing plants, such a condition would constitute an ominous inroad upon the world’s foodsupply, the future adequacy of which already causes some apprehension.
The problem of lubricants, then, is the problem of oil-supply and of efficiency in the process of oil-refining.
III
Petroleum, as it is found in nature, is not a uniform substance. On the contrary, it varies greatly in some of its basic characteristics. It is a liquid that has both solid and gaseous substances dissolved in it. If it is left to the free action of the air, it will gradually break up into these various component parts. First, the gases will escape; these are what is known as ‘natural gas,’ used rather extensively for lighting purposes in some parts of the country, and found in conjunction with petroleum. Then, such lighter components as gasoline will evaporate, until, finally, only a solid residue remains. This residue is one of two types, either paraffin wax or asphalt, and it is the character of the residue that determines the kind of oil with which we are dealing.
There are between one hundred and fifty thousand and two hundred thousand oil wells operating in the United States; estimates vary to as large an extent as that. These wells are scattered over the various oil-fields, which, for purposes of convenience, may be divided into the eastern and western groups. Curiously enough, the petroleum found in the eastern group of oilfields is predominantly paraffin, while that found in the western group is just as predominantly asphalt.
The fields of the eastern group, including the very important KansasOklahoma fields, are distinguished by the fact that they are bound by a comprehensive system of underground pipes, through which the oil flows from the wells to the refineries. The western group, consisting principally of the California fields, supplies many of the local needs for oil, and ships its surplus to refineries by rail, in tank cars.
Because of the ease with which oil can be transported by means of pipes, some of the largest refineries in the United States are located far from any of the important oil-fields. For example, one of the most important refineries is at Bayonne, New Jersey, hundreds of miles away from any large oil-field; yet it is fed constantly, through underground pipes, with the liquid from which it makes the huge quantities of gasoline, kerosene, various kinds of lubricating oils,and numerous other products, which are shipped to various parts of the United States and of the world.
A refinery does to crude oil what evaporation would do, except that the various component parts of the original fluid are caught as they are given off, and are stored for use. But, besides that, human ingenuity has devised means for rearranging some of the chemical compounds of the original petroleum in such a way as to increase or diminish the output of this or that product of oil. In the process of refining, the four principal products recovered from oil are gasoline, kerosene, fuel oil, and lubricating oils. Each of these products has its own use in civilized life, and each may be recovered intact from the original crude oil.
The uses of gasoline are quite patent. It is the fuel that makes possible internal-combustion engines. Because of its existence, we have had an opportunity to witness the breathlessly swift development of the automotive industry. The automobile and the aeroplane have introduced far-reaching changes into the economic and social life of the world. The motor-truck has become an invaluable adjunct of our system of distributing goods through the various parts of the country. The contribution of the automotive vehicle to the needs, the comforts, and the pleasures of mankind has been, undoubtedly, the greatest and the most spectacular feature of recent progress.
Kerosene was the first, and for nearly four decades the most important, product of petroleum. At the time when kerosene began to be commercially extracted from crude oil as a source of light, a liquid obtained from some varieties of coal was already in use, under the name of coal oil. Popular fancy got kerosene and coal oil confused, and the latter name has stuck to kerosene.
All through the second half of the nineteenth century kerosene was the great illuminant of the world. Through the efforts of the great Standard Oil Company, built up by the genius for organization of John D. Rockefeller and his associates, kerosene became the chief source of light, not only in the United States, but in such far-off countries as China. But toward the end of the century the use of kerosene as a source of light began to decline. The gas-mantle and the electric bulb pushed out the lamp, as artificial gas and electricity displaced kerosene, which now remains the iliuminant of only the frontiers of the world.
On the other hand, kerosene is beginning to be used rather extensively as a source of power, for the propelling of tractors used in agriculture. It has been adapted to certain types of internal-combustion engines, and is rapidly gaining an economic position for itself in this field.
Fuel oil is used as a direct substitute for coal. It generates electricity, runs various kinds of steam-engines, and is rapidly coming to displace coal as marine fuel. Its advantages over coal are very great. Oil is much more easily transported than coal. It occupies less cargo space, which is a most important consideration on board a ship. And it is much cheaper, in terms of the labor required to mine it and bring it to the places where it is needed. Fuel oil has become an indispensable commodity, so far as the navies of the world are concerned. In 1921, the American navy required over eight million barrels of fuel oil. The mercantile marine is no less in need of fuel oil as an indispensable adjunct of its development. The fuel-oil requirements of the Shipping Board for the year 1921 were estimated at sixty million barrels.
The uses of the various lubricating oils derived from petroleum have already been described. The demand for lubricants is increasing all the time, and no limits can be set to these requirements, except the scale on which machine civilization itself develops. Labor-saving machinery is more and more coming into use in the home and on the farm. Each piece of machinery thus introduced on anything like a large scale means machine-production at the factories, which is impossible without lubricants; and it also means the use of lubricants for the running of the labor-saving devices themselves. The rapid development of water-power has for its immediate result a new development along the lines of labor-saving machinery — a new demand for that indispensable attribute of machineoperation, the lubricating oils.
These four principal products of petroleum use up about eighty per cent of the total amount. — close to half a billion barrels — consumed in the United States every year. Of the other twenty per cent, about five per cent goes to waste, while the remaining fifteen per cent is used for the extraction of various by-products. Already nearly two hundred by-products are obtained from petroleum. Vaseline, benzine, paraffin, asphalt, are the best known of these by-products. But the utilization of petroleum by-products is still in its infancy. There are vast possibilities of almost incalculable usefulness hidden in the still unbroken chemical compounds found in crude oil. It is considered by experts that the coal-tar industry can eventually be duplicated by the petroleum-by-product industry in serving the developing uses of modern civilization. And the importance of the coal-tar industry may readily be seen from the fact that its yield of aniline dyes alone is sufficient to ensure it a secure place among the indispensable resources of civilization.
IV
When nature produced petroleum, millions of years ago, she placed in the mixture the various chemical compounds which we now extract from the crude oil that gushes to the surface every time we tap one of its hidden reservoirs. And the older or more primitive methods of refining consisted merely in extracting from crude oil as large quantities of the various compounds as the oil had to yield. This process is known as ‘ skimming,’ and is very wasteful. The most modern process, known as ‘cracking,’consists, as one of its phases, in forcing some of the molecules in crude oil to undergo a chemical change, in such a way, for example, that a barrel of crude oil may be made to yield more gasoline than the original mixture contained — at the expense, let us say, of the amount of lubricating oils yielded at the same time.
This application of human ingenuity to the process of recovering from the crude oil the various products that we need for the uses of civilization raises a very important question, which acquires special significance in view of the fact that the supplies of oil still left for future use are visibly limited and increasingly less accessible. The relative importance of the various products of oil is a tangible fact, which requires most close and attentive scrutiny from the best experts of the country.
The most spectacular feature of the whole oil development has been the growth of the automotive industry. In 1911 there were 700,000 motor-vehicles registered in the United States, and in that year the production of oil was 315 barrels per motor-vehicle. Ten years later, in 1921, the number of motorvehicles in the country had increased to 9,500,000, so that the average production of crude oil per motor-vehicle was only 47 barrels. Each one of these motor-vehicles is run by gasoline; and it is in answer to this growing demand for gasoline that the best effort of the oil-refining industry has been directed toward finding a way of getting as much gasoline as possible out of crude oil.
But at the same time the demand for, and the production of, lubricating oils has also increased tremendously. In 1914 the United States produced 517,000,000 gallons of lubricating oils of various kinds. By 1919, the amount increased to 819,000,000 gallons, and to-day it is well over a billion.
In the course of the past few years there has been a definite trend in the refining industry in the direction of shifting the principal emphasis from gasoline to lubricating oils. The ‘skimming’ process leaves most of the lubricant content of the crude oil in the residue fuel oil, where it is burned up, instead of being recovered. In 1921, according to the figures compiled by the United States Bureau of Mines, the ‘skimming’ plants constituted 35 per cent of the total refining capacity of the country, while those plants which pay considerable attention to the recovery of lubricating oils constituted 46 per cent. In commenting on this trend, Mr. Pogue says: —
As the demand for lubricating oil increases, one refinery after another changes from destructive distillation practice, in which the focus is upon gasoline, to steamdistillation practice, in which the prime objective is lubricating oil.
Paraffin-base oil contains 25 per cent of lubricants. Asphalt-base oil has as much as 40 per cent. Yet, on the average only 5.4 per cent is recovered to-day. That means that we waste at least four fifths of the lubricating oils contained in the vast amounts of the crude product that go through the refineries. Here we still have a very considerable margin in favor of the lubricants, enormous quantities of which are now burned up.
But even with better utilization of oil, and a much more careful evaluation of the relative uses of its various products, the fact still remains that the world’s supply of oil is visibly limited. And this fact is really the alpha and omega of the whole situation.
V
There is a struggle for oil going on in the world to-day, and the geography of the oil situation is a highly significant factor in determining this struggle. The remaining available stocks are almost evenly distributed between the two hemispheres, but the demand for oil, taken in terms of industrial and general needs, is also similarly divided between these two portions of the globe. Of all the primary materials, the utilization of which constitutes the basis of present-day civilization, oil is the one that requires most immediate and serious attention. The struggle for oil is the struggle for industrial stability and power. It is an acute national problem with each of the industrialized countries of the world. And since there is not one of these countries that possesses to-day within its own political boundaries sufficient reserve stocks of oil, it is an international problem of first-rate importance.
The United States is intimately concerned with every aspect of this problem. Her principal rival in the securing of oil resources is Great Britain. This fact need no more be ground for animosity between the two countries than their commercial rivalry; but it is a tangible fact, nevertheless.
Taken by and large, the attention of the United States is directed principally toward the securing of the resources that are located in the Western Hemisphere, south of the Rio Grande; while Great Britain’s attention is centred on the Near East. But Europe — Great Britain, as well as other countries — is also reaching out to the Western Hemisphere, while American oilinterests are active in the Eastern. In these encounters real rivalry develops.
By whatever name one chooses to call it, — whether imperialism, or economic necessity in terms of basic industrial needs, or insurance against possible shortage of one of the indispensable bases of modern economic activity, — this struggle for oil is an incontrovertible and inevitable fact. Looking at it in perspective, one is led to believe that geography, tradition, and discernible inclination generally conspire to bring about a state of affairs in which Great Britain will, before long, find herself master of the principal oil-resources in the Eastern Hemisphere, while the United States will similarly be in control of the oilbearing areas of the Western Hemisphere. And it still remains to be seen whether these two industrial giants will divide the world thus, into two oilempires, amicably, or whether they will face considerable and deplorable friction, just as their national oilinterests are now in keen competition in Persia, as well as in Mexico.
This is the visible trend to-day. But for those who believe that, in spite of the present-day confusion attending our adjustment to the conditions created by the war, the world has irretrievably entered upon the path that leads to intercontinental economic collaboration, and eventual integration, the solution of the oil problem — so far as the control of the resources is concerned — appears in a different light. The oil problem is merely the most pressing part of a more general one, the solution of which lies along the lines of some sort of international control over the world’s stocks of primary materials, and over their allocation among the nations. The world has definitely passed the stage of regarding its natural resources as practically inexhaustible. It seems inevitable — if civilization is to endure — that there should be some sort of international control in the matter of the distribution of such primary materials as coal, iron, timber, and, first of all, oil.
This question came up at the Paris Peace Conference, and was quickly dismissed. But it is bound to emerge again. For there seems no doubt that humanity’s choice in the next decade or two will be between some such scheme of international action and a series of conflicts for the possession of primary materials.
If the first alternative triumphs soon, well and good. But in the meantime, the world still being what it is, it is impossible to escape the conclusion that the bid of American capital for oil resources outside the United States ought to be considered, from the point of view of the country’s national interests, as legitimate as the bid for commercial markets. There is considerable doubt, in the minds of many careful observers of international economic developments, as to the wisdom of America’s reaching out for the oil resources of the Old World; for that is apt to involve the country in political difficulties of an unwelcome nature. But this objection does not hold with nearly the same margin of political inexpediency with regard to the Western Hemisphere. So far as oil is concerned, at any rate, an economic interpretation of the Monroe Doctrine seems a sound enough proposition, from the point of view of American statesmanship — until the whole Doctrine shall have lost its raison d’être in the larger scheme of an intelligently organized and workable apparatus for international economic action.
This is one phase of the question. But there is another, equally important, and closely linked with it. Civilization is definitely confronted with the problem of conserving the essential resources which constitute its basis. It cannot afford to waste them. And no country has ever been so wasteful of its wealth as has the United States.
But conservation — again, if civilization is not to recede — has to be applied constructively, in terms of utilization. Oil is cheap to get and convenient to use. There is, therefore, a distinct temptation to use it unheedingly. A doctrine of oil-conservation, with a view to its more rational utilization, is as important as that of forest-conservation with a view to reforestation.
Just as the use of oil as an illuminant, except in special cases, has practically disappeared, so its use as fuel should be reduced to a minimum. Marine engines need oil as fuel, for nothing else will answer the purpose, except at a great sacrifice of cargo space and speed. But there is no reason to use oil for stationary machinery on land, so long as the tremendous water-power resources of the country remain undeveloped. What reason is there, for example, in burning up millions of barrels of oil in coalless California, when the harnessing of the Colorado River can easily supply all the energy which that state needs to turn the wheels of its economic life?
The greatest waste in the utilization of oil to-day lies in the burning-up of enormous quantities of the more valuable compounds, through irrational refining and through too great a use of oil for fuel purposes. The trend is to concentrate on lubricants and on gasoline, though the time is coming when greater emphasis will be laid on the first than on the second. So long as modern machinery is impossible without lubricants, and so long as oil is the sole source of high-speed lubricants, it is a crime against civilization to permit a single recoverable gallon of lubricants to be sacrificed for the sake of more or less easily replaceable fuel.