The significance of the subject of the present study-the cost of finding, developing and producing petroleum-can be better understood by placing it against a summary view of the supply situation in the postwar world. The most striking fact is the appearance of vast new reserves of oil in various parts of the world. Earlier concern over "conservation" was aroused by the fear of depletion of the available supply. Taking a long view, this possibility is not to be dismissed. But in recent years the practical problems of the industry, and of public policy toward it, are of a different sort. The capacity of the industry to produce in the countries of the "free world" greatly exceeds the current rates of consumption. From the sellers' point of view, at least, it seems self-evident that "too much" oil exists today.
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Lovejoy, Wallace F.; Hofman, Paul T.; and Galvin, Charles O.
"A Study of the Problems of Cost Analysis in the Petroleum Industry,"
Journal of the Graduate Research Center: Vol. 31:
1, Article 1.
Available at: https://scholar.smu.edu/journal_grc/vol31/iss1/1