This paper is based on the formula that the petroleum industry is sick-findthe cause, eliminate it, and the industry will get well. There' is perhaps nodifference of opinion that the cause is overproduction, actual or potential.But that, again, is a result rather than a cause. The problem is to study theinfluences that serve to keep production and consumption out of balance. Production control is a popular theme and a natural one at this time when thewhole world is unstable; but production control in its popular sense meanslittle more than the application of emergency measures while danger threatens. Economists differ as to the effectiveness of these, most of which are designedto alleviate and not to cure, but we assume there are none who question thewisdom of promoting conditions under which economic forces are permitted tooperate freely in bringing about stable conditions. The petroleum industry suffers from two classes of economic ills that serve topromote overproduction; namely, those which are common to all industries andthose which are peculiar to this industry. It is of the latter I wish to speak. Strange to say, government is responsible in large part for this latter classof ills that affect the petroleum industry and we are coming to recognize thatonly through the assistance of government can they be corrected. Instability of the petroleum industry, in so far as human agency was involved, had its inception in 1875 when a Pennsylvania jurist, called upon to make adecision for which there was no precedent and fancying he noted someresemblance between the so-called fugitive nature of oil and gas and that ofwild game, made mention of that resemblance. Other courts being impressed by the analogy enlarged upon it, and graduallyfixed upon oil and gas a legal status in certain important respects similar tothat of wild game. Although later the courts abandoned this analogy, certainpractices that developed out of that early concept have continued to this dayand are largely responsible for the industry's present plight. Thus, instead ofownership in place that is characteristic of private property generally, thelaw of capture was applied to oil and gas.