"Annihilation"

A smart Los Angeles lawyer named Martineau was made a Special Assistant U. S. Attorney General and summoned to Washington. The Department of Interior's much-publicized Investigator Louis R. Glavis was once more in the spotlight. It was darkly hinted that revelations would be more scandalous than anything since Teapot Dome. Attorney General Cummings and Secretary Ickes conferred with the President. A Federal board was hastily announced to issue ''tenders" without which not a drop of East Texas oil could be accepted for shipment in interstate commerce. And. as the Washington marching and countermarching continued, newshawks were informed last week that the Government was about to launch its latest & greatest drive against the recalcitrant producers of "hot oil."

What stirred the Administration to one more desperate effort to save its oil program from complete collapse was the rip-roaring gasoline price-war which, from the Rocky Mountains to the Atlantic Ocean, made motoring a joy (TIME, Oct. 22).

Ostensibly a free-for-all between independent distributors and the major companies over the differential between branded and unbranded fuel, the contest was touched off by the flood of oil produced in excess of state quotas. By last week the only apparent check to price-slashing was a clause in the Oil Code limiting cuts to no more than one every 24 hours. Retail prices were off from 2-c- to 9-c- per gal.

Skirmishes were going on in nearly every big city east of the Mississippi. Along the seaboard it had settled down to a pitched battle between Standard Oil of New Jersey and the independents, with every other oil company helplessly drawn in. Standard was determined to keep its prices 1/2-c- above the independents and the independents were equally determined to maintain a 1 1/2-c- differential.

In Camden the price was down to about 5-c- exclusive of taxes and motorists were madly storing fuel in tanks, cans, barrels, buckets, bottles. It was estimated that the oil companies were losing 3-c- to 4-c- on every gallon sold. Harry Ford Sinclair, who has felt the heavy hand of the Standard companies in his time, remarked: "It's not a price war; it's a war of annihilation."

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