Letter to Senator M. M. Logan Urging Legislation on Petroleum Production.
My dear Mr. Chairman:
I have received a disturbing letter from the Administrator for the Petroleum Industry, Hon. Harold L. Ickes, informing me of the continued daily production of oil in excess of the maximum amount determined on by the Administrator pursuant to authority under the Petroleum Code.
The Administrator states that the records of the Bureau of Mines during the first three months of this year show a daily average production of "illegal" oil of 149,000 barrels. Technically speaking, this may not all have been "hot" oil, but in a real sense it is, since it is oil produced in excess of the allowable. While the final figures of the Bureau of Mines are not available for the months of April and May, it is unquestionably true that there is a growing disregard for production orders issued under the Petroleum Code and that the trend of hot oil produced is upward. For example, it is stated on reliable authority that the daily excess production in the East Texas field alone is running at 60,000 to 75,000 barrels per day. Other estimators say that this figure should be much higher. The Oil and Gas Journal recently estimated that there was illegal production in the country as a whole of 198,475 barrels per day during the week ending May 12th.
If the principle of prorating production under a code is to be maintained, it seems necessary that the existing law should be strengthened by the passage of the Bill which has been introduced in the Senate by Senator Thomas and in the House by Congressman Disney and supported by the Oil Administrator.
It is a simple fact that as a result of the work of the Oil Administrator definite progress has been made both in eliminating unfair practices and in raising the price of crude petroleum to a reasonable level, which has brought added employment and more fair wages to those engaged in oil production.
I am frankly fearful that if the law is not strengthened, illegal production will continue and grow in volume and result in a collapse of the whole structure. This will mean a return to the wretched conditions which existed in the spring of 1933.
I hope therefore that the proposed legislation can be enacted. I do not want to see this important American industry reduced to the condition under which it was operating before the Oil Administration started its work.
Very sincerely yours,
Hon. M. M. Logan,
Senate Committee on Mines and Mining,
Hon. Sam Rayburn,
House Committee on Interstate and Foreign Commerce,
Franklin D. Roosevelt, Letter to Senator M. M. Logan Urging Legislation on Petroleum Production. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/208814