OIL AS AN ECONOMIC AND MILITARY NECESSITY The mechanization and motorization of modern armies, the con version of naval units from coal-burning equipment to oil-burn ing equipment and to Diesel engines, and the expansion of mili tary and naval aviation have made petroleum and its products an indispensable military necessity. The economic and military dependence of certain countries on outside countries and foreign corporate enterprises for their essential petroleum requirements have, with the increasing military and naval importance of petro leum, resulted in new conceptions of the scope of the definition of "contraband of war," and tile new diplomatic and military weapon termed "sanctions," which was invoked against Italy during her conquest of Ethiopia.
Thus, the trend of petroleum has been toward an increasing and unavoidable involvement in international diplomacy and in con siderations of national defence throughout the world. Except for the United States and possibly Soviet Russia, the industrialized nations, or those in process of industrialization, have little home petroleum production—far less than their present and potential needs—and, therefore, are dependent on outside sources. In its permanent peace-time aspect this is a sufficiently serious situation for European countries such as Great Britain, France, Germany, and Italy, and for Japan in Asia, but the importance of oil sup plies soars into even greater prominence with each succeeding "war crisis" because of petroleum's indispensability to modern mechanized armies, air fleets, and naval armament. The extent and degree of outside dependence varies with the countries. Those mentioned draw heavily on United States petroleum sources for refined products of petroleum such as gasoline, kerosene, fuel oil, and lubricants, but all have greatly expanded their refinery facilities in recent years. Their position with re spect to product imports has improved, while necessarily they have been forced greatly to expand their crude petroleum imports. For these crude oil requirements, South America, Mexico, Trini dad, and the United States oil fields, and the producing coun tries of Europe, Western Asia and the Far East are drawn upon. The United Kingdom, with no commercial petroleum production at home, has to go to Iran, Iraq, India, and the East Indies for large supplies, in addition to those from the Americas. Certain of these countries have been so successfully developed for oil— and pipe line, tanker and refinery facilities have been so mate rially increased—that, insofar as the United Kingdom is con cerned, adequacy of supply is not so much the question as keeping the sea lines of communication open.
In the interest of national defence and economic independence, European countries have done much in recent years in the pro duction of benzol as a substitute motor fuel. This is obtained largely as a by-product of high temperature coking of bituminous coal.
With the help of Government protection, Germany is supplying a large portion of her liquid fuel requirements from coal products. It is estimated that above one-quarter of that country's peace time motor fuel requirements could be supplied by benzol from coke. In the United Kingdom, benzol represents about 2 to 3% of the motor fuel consumed. France and Belgium also have sup plemented their petroleum motor fuel supply with coal products.
Plants for the hydrogenation of coal to gasoline exceeding 8,000,000bbl. of gasoline per year are operating in England and Germany. When operating for maximum gasoline, they yield about 65% by weight on the ash-and-moisture-free basis of coal charged. No by-products are formed for which a market must be found. Normally the cost of 1 o to 15 cents per gallon may be ex pected, depending upon coal and labour costs, rate of amortization, taxes, etc. This method produces 90 to 14o gal. of crude oil per short ton of coal and seems the most promising primary source of motor fuel from coal. In England, gasoline from coal is sold profitably in competition with the petroleum product with the assistance of a Government subsidy.
Another supplementary source of motor fuel supply long drawn upon in the United Kingdom is from Scottish shales. France has led in the development of a motor fuel grain and vegetable alcohol through restriction of petroleum imports and subsidy of national growers and industry.
The United States has practically unlimited coal and shale re serves available as motor fuel sources, but their development for this purpose will await the day when they can be manufactured in competition with petroleum. That day appears to be far dis tant. Such developments clearly owe their stimulation to the efforts of nations less favoured in petroleum resources to build up a degree of independence. They necessarily involve relatively costlier processing, and their products require a higher price re turn in commerce than do petroleum products.