Word: bbl
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Some 50% of all domestic production, which now stands at 8.7 million bbl. per day, comes from wells dug by the industry's 10,000 independent wildcatters. The breed's home base is the boom city of Houston, and the risks and rewards of the profession are reflected in a remark by one of its members, Chester Benge: "The oil business is one of the few businesses in the world where you can go to bed poor and wake up rich...
...whole global system often begins to tremble and twitch. Example: just as U.S. refinery capacity was being strained by the demand for gasoline, Exxon was hit in late March by a freak fire at its Bayway Refinery in Linden, N.J. The accident has knocked out some 160,000 bbl. per day of refining production until at least June. That has kept the company switching around tankers on the high seas, sending them to other refineries in a desperate rush to make sure that every drop of crude is refined in a hurry...
...price of each barrel of domestic oil halfway up to the cost of more expensive OPEC crude. At the same time, any refinery that imports costlier OPEC crude gets to withdraw an equal amount from the pool. For example, a refinery that buys domestic oil for, say, $9.45 a bbl. would pay about $2.50 to the fund; a refinery that imports foreign oil for $14.55 would then collect that $2.50. Observes Oil Economist Arnold Safer: "The entitlements program, in effect, gives any company that imports OPEC oil $2.50 for absolutely nothing. The system creates a perverse incentive, just the opposite...
...result of increased output from Alaska, Mexico and the North Sea. But it would be foolhardy to expect that OPEC will any time soon lose its ability to control prices. Saudi Arabia alone has more than 25% of all proven world reserves; its daily output of 8.5 million bbl. is indispensable to Western Europe and Japan, and provides more than one-fifth of all U.S. crude imports...
Only two years ago, oilmen were confident that the Saudis would steadily boost production, to as much as 20 million bbl. a day by the early 1980s. A Senate report three weeks ago concluded that the West will be lucky if the Saudis achieve much more than half that level over the next eight years. They have been shaken by the experience of Iran, where the social strains of rapid industrial development brought on revolution. The royal family is split between moderates eager to expand