"The offshore oil area," says Magnolia Petroleum Co., "may be the last big undeveloped oil province in the U.S." Yet, while the U.S. is worried about sources and has only an eleven-year supply of proven reserves, Magnolia and most of the other major producers are cutting back their offshore search. Last week only 79 seaborne rigs were poking their drill bits into the Gulf of Mexico; last August in rigs were operating off Louisiana's shores alone.
Chief reasons for the slowdown are a surplus of oil and light demand. The trouble started during the Suez crisis, when oilmen expanded...
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