Denver — I think that I shall never see The oil in-dus-try Without a ca-tas-tro-phem.
According to Tom Dougherty of the Petroleum Information Corporation, this bit of doggerel was told to him years ago by an old-time oil industry reporter.
In the energy boom years since the Arab oil embargo of 1973, this bit of commentary was widely ignored. But the current oil glut, with declining prices spawned by energy conservation and world recession, has brought tough times to America's ''oil patch'' for the first time in over a decade.
While the drop in oil prices appears to be contributing to economic recovery in the United States, the mood remains glum in oil company offices amid the gleaming high rises in Denver and Houston. The industry appears to be in for up to five years of consolidation and shakeout.
Although detrimental to the domestic oil men, their bankers, and the investors who were swept up in the ''energy euphoria'' of the recent past, current conditions will result in some major benefits, industry observers say. Excesses caused by the boom mentality are being corrected. The industry is being forced to become leaner, more efficient.
Despite widespread cheer over declining oil prices and the problems of the Organization of Petroleum Exporting Countries (OPEC), Theodore Eck, chief economist of Standard Oil of Indiana, cautions that oil prices will not stay down long. ''This is a period of temporary price weakness.''
Thomas A. Petrie, a senior oil analyst with First Boston Corporation, agrees. Since 1978, the nation's 13 largest oil companies have found only a half barrel in new reserves for every barrel they have pumped from the ground. Inevitably, the current glut will eventually be reversed, he argues.
Meanwhile, representatives of the oil exploration industry say they are not in as bad shape as some news media reports portray.
''This is still a good piece of business,'' maintains John F. Greene, president and chief executive officer of Milestone Petroleum. The drop in prices , he says, has been more than offset by the recent drop in drilling prices caused by excess rigs. So the potential profits from oil exploration are actually higher than a year ago.
However, Mr. Greene and his peers are frustrated because, after being the darlings of the financial community for so long, they are now treated more like pariahs.
''Sound projects can still get financing. It is the clearly marginal projects which are in trouble,'' rebuts Arnstein Endresen, vice-president of Norway's Den Norske Creditbank. He acknowledges that the banking community must bear responsibility for some of the excesses of the oil boom. Many bankers relaxed their standards amid the general euphoria. But ''people now realize that oil is a commodity, like other commodities, not something special,'' he says.
As a result, bankers are reconsidering their energy lending policies. They are lending smaller amounts to specific projects and allocating less money in the aggregate for energy, Mr. Endresen reports. Also, bankers these days are more interested in lending money for the development of already-producing fields than for exploration.
The biggest question mark in the oil industry's immediate future is what will happen to the demand for petroleum as first the US, then the rest of the Western world, heads into recovery. In 1982, US energy consumption remained flat while that of the West declined by about 5 percent.
''We don't know how much of the decline in energy demand is due to . . . conservation and how much is due to weakness in the business sector,'' acknowledges Thomas D. Thompson, senior vice-president and chief economist at Crocker National Bank. Conversely, no one really knows how much energy demand will increase with recovery.
''Consumers won't suddenly double their driving or give up energy conservation,'' argues Bank of America economist Jeanette A. Garretty. She forecasts some increase in energy demand this year, but not much.
If anything, the possibility of increased oil demand looks even dimmer in Europe. ''Our projections are for a slow increase in oil demand in the 1980s, even with a very, very strong recovery,'' says Carl Tham, director general of the Swedish National Board of Energy. If demand does start to rise, European countries won't hesitate to raise oil taxes, he adds.
The oil price drop has already sparked talk in the US Congress about new energy taxes, in addition to the new nickel-a-gallon gasoline tax which takes effect April 1. The idea of taxing oil imports has been resurrected in the hope that it would reduce the deficit through new revenues and encourage energy self-sufficiency. Last year, the US imported only 10 percent of its energy needs , compared with more than 20 percent just three years ago. Energy forecasters generally foresee an increase in US energy dependency in the coming years.
The industry opposes any new oil taxes, but, oddly enough, many hope that the Supreme Court next month upholds the constitutionality of the windfall profits tax. The tax, which has already enriched federal coffers by $25 billion since it went into effect, was struck down by a Wyoming federal district court judge in November.
If the court declares the tax unconstitutional, it will create a legal mess, says William Houston, chief tax counsel for Marathon Oil Company. In the end, Congress would probably just reenact a revised form of the tax and make it retroactive.